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Get a DemoWhat are the secrets to winning in ecommerce that nobody talks about? Matthew Bertulli (CEO, Pela Case & Lomi), Jason Panzer (President, HexClad), and Mike Beckham (CEO, Simple Modern) reveal 12 lessons for anyone building a brand from the ground up. This is what they’d tell their younger selves if they ever got one more shot. Secrets like why it takes a decade for your brand to earn its name and how walking away from weak products makes grit pay off. After that, cash gets a hard look because even strong margins can still starve your reserves. Also included are quick hits like customer obsession, copying your first product, hiring slow, and firing fast. Powered By Fulfil https://9ops.co/fulfil Aftersell https://9ops.co/4i3bb5 Richpanel https://9ops.co/richpanel Northbeam https://www.northbeam.io/ Saras Analytics https://bit.ly/4a3gzVv Postscript https://9ops.co/postscript Operators Newsletter https://9operators.com/ Chapters 00:00:00 1 Commit for a Decade 00:06:10 2 Get Better at Quitting 00:11:25 3 Network Is Net Worth 00:17:35 4 First Product Is a Copy 00:19:31 5 Cash Is Life, Not Profit 00:26:20 6 Learn to Write Daily 00:34:57 7 The Market Doesn’t Care 00:37:55 8 Hire Slow & Fire Fast 00:45:00 9 Marketing Should Print 00:49:30 10 Hold Positions Loosely 00:52:23 11 Consistency vs Genius 00:56:49 12 Talk to Your Customers
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Welcome back to the pod. I am here with Jason. I am here with Mike, and today we are gonna give you 12 secrets, 12 things that we wish we knew when we were younger on how to win in e-commerce. This also happens to be 12 things that you are very likely to screw up. This is fresh for us. We are launching a new brand. I hope you learn something. What we're gonna do is each of us, we'll just kind of go in order. We'll rotate around. Each of us will drop sort of a nugget, a thing that we would like to tell our younger selves, or in this case, the people who are listening or watching. Uh, and I'll start it off if that's cool with you guys. The one that I kind of, I don't know why I have to continue to relearn this one, but I think in consumer, you should commit to doing it for at least a decade. So like in my life, I operate in seasons. A season is 5 years. I think if you're gonna start a brand, In consumer, it's likely that you're going to be at it for at least 10 years. The reason for this is that they just take a long time to build properly. I know that there are stories of like kids launching dropshipping versions and products and all that stuff, and they're going to really big size really fast, but there is no proof that any of that is actually going to be around a long time, right? Yes, they can get going really fast, but if you look at the large brands. Most of them have been around a long time, and I think it's a good idea that you go into it with that mentality. Any of you guys, do you guys disagree with that or?
No, no, no, no. I love this one. I love this one. You know, it's so frustrating to see all these people that think they're like, they're just building a business that they're just going to sell in a few years. It's like, stop dreaming. Okay. I was an M&A banker.
Jason, the crusher of dreams.
Like, I was an M&A banker, you know, I did deals for a living, like, it's just not gonna happen. You know, it's like super, super rare that you're gonna build something that's gonna sell. And the best approach to mitigate that risk is to build a business that you want to own forever, right? And then the exit will take care of itself. And that's what Danny and Cole did at HexClad. And it's funny, they needed— we're almost at our 10th anniversary, by the way, at HexClad. And Yeah. And they even, and their first product wasn't even the HexClad cookware. Like it was a different idea, but they kind of grew up in the cookware industry and they quickly pivoted to cookware. But like that being said, you know, their idea was like, hey, we're going to build a nice little business and we're going to make money. You know, no one was giving them money. They were going to build a nice little business and they were going to make money. And look what happened. Right. And I just, you know, I've just seen it a million times. It just, It takes forever. And, and a lot of these businesses that are really successful now, it wasn't like their first product idea also, you know, some are, but, but, but many are not. I mean, look at Amazon. They were selling books. Okay. The idea, I don't care. The deal was to sell books and it's just like way different now. So I love it, Matt.
Would you guys both agree that the younger you are as a brand and consumer, the higher the discount rate on your value? To the market? Like if you were to try to sell something in a couple years, 2, 3 years, like that age actually, like young age works against you.
I don't think it's so much age as the whole goal in consumer is that you're trying to make your mark and your name mean something. And that takes a long time to achieve. And that the value, it's one of the few things where value really does compound. You know, everybody says they want to be in a compounding business, but so much of what happens in the business world isn't really compounding. It's these short windows where you have to kind of take advantage and make the money when you can make the money. And consumer, like a great consumer brand is one of those few things where it's like the brand can just get stronger and stronger and stronger and stronger. And the, that's, I think part of the reason why the really big outcomes happen, you know, 10 years in, 15 years in and not 3 years in. But the other thing that Jason said that I thought was really good, as I reflect on it, I don't know for Sean, but I know they've got some new hero products that are so big that they might be bigger than wallets. He just mentioned with HexClad that their first product was not their hero product now. The same is true for Simple Modern. The first couple of products we launched, we don't even sell anymore. And yeah, I mean, well, it was a couple of like, you know, it was like a tea infuser and this other stuff. And here's the craziest thing that's going on with us recently. Is that our biggest profit generator on Amazon next year might be kids' backpacks. Might be, I don't know. We'll see. And, but it's, it's pretty stunning for us to, you know, having built this drinkware company where we've sold 60 million pieces of drinkware, that maybe kids' bags might even be a bigger category for us. And, but I think it speaks to, with all of our brands, that you start to have the value is in the name. The value is in the trust and the appreciation that people have for the brand, and then that can be applied across a bunch of different products. But building that kind of trust, name recognition, you know, people talk about being a household name, that's harder than ever to achieve. There's more noise out there. This isn't the broadcast era where everybody's watching the same shows, and you can, if you can just make it on TV, then everybody knows who you are. So I think that this point is absolutely right. And It's amazing time and again, these businesses that we meet that we really admire, you realize, man, they're a lot older than I thought they were. They came into my consciousness 3 years ago, but they're in year 11. And like, I think that it, that was my experience with Simple Modern was like the first 5 years, nobody cared. Nobody knew about it. Not even people like my friends, you know, I mean, it was like people even in Oklahoma, like nobody knew, nobody cared. And then there was a point around year 7, where we started to break in the consciousness. And now we're in year 11 and like, at least, uh, you know, around me, everybody knows who we are, um, in, in kind of my market. And so it just takes time, takes time to build that awareness.
All right. So Mike, give us number 2, which I think might be the inverse of the one I just gave.
Well, I think it's the balance. The balance is that if you just say, hey, this is gonna take a long time, so I should just be ready to beat my head against this wall for a long time. That's, that's good. You should probably be ready to like think that way, but you have to balance that with another thing, which is, You have to learn, as the song says, you gotta know when to hold 'em and know when to fold 'em, that you really do have to learn when to quit. And ironically, being good at perseverance requires being good at quitting because perseverance in and of itself is not a virtue. It's only a virtue when you're persevering in the right things. We could probably all give examples of where my persistence, my grit, my tenacity has actually been more of a liability than an asset because I kept going at something that was clearly not working. The market was clearly telling me, hey, this isn't actually what we want you to be doing. And I could have been pursuing something that would've been much better or much more profitable. And so like the, there's a great book, I think I've referenced it on here before. It's called The Dip. It's by Seth Godin. And the point that he makes in the book and the way that I would encapsulate this point is that you want to make a deal with yourself, which is that I am either going to go all the way or I'm going to quit quickly. And that's basically my rubric is that I'm willing to try a bunch of things and then fairly early on, I'm going to assess the data and I'm going to be willing to quit liberally. You know, I'm willing to quit 95% of the things I try and quit quickly so that the things that I stick with, I can go all the way. And he uses a really good example from an ultra marathoner that the ultra marathoner was saying, basically you have to decide before a race, are you going to go all the way? Are you going to finish? Because if you think about it at points during the race, you're gonna be like, my side hurts. You know, I'm really tired. I didn't get good sleep. I mean, you know this, Matt. So that's kind of my overall balance to the first point.
This is the bookend of the first point. And it sort of goes back to one of the things I was saying, it's like, there's just so many business, it's just, this is just really hard, you know? And it is definitely worth it to know, you gotta have a read, you should have a read like of whether or not it's worth it. But, you know, don't expect the overnight success, but also like, also know, do you have product market fit? Like, do the numbers make sense? Are you, there's just so many people with ideas and it's incredible. but, you know, most of them just don't stick. Why do venture capital funds, like, they're not looking for a return on every single investment, you know, they just, they just know that they're going to have a bunch of stinkers and they might have 1 to 3 really good ones.
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My take on this one is, uh, I agree with what you're saying. I would add that the thing I'm in it for, I, I, so I made this comment on X the other day in response to one of Nick Shackelford's posts. But I think if you guys have read the book Shoe Dog, Phil Knight, at the end of the book, I forget exactly how he words it, but he's basically got the— he ends the book by basically telling people to never stop. But he— the nuance of that is he's like, but it's okay to quit things along the way. So like, my view of this is I'm just committed to building brands and being in consumer and just being in marketing, and it's just the thing I like to do. But I'm very okay quitting things and I'm very okay failing. And I'm also okay doing it publicly because if you're not okay failing in public and other people, like, then you're really not okay with failing. Like, if people don't know that you failed, you're not okay with failing. So I think it's okay to quit things. Uh, just don't stop.
I would say, I would add that we, we should celebrate quitting at the right time on things. And we, we, we're like, we're a culture that celebrates starting things. Um, and so like, oh, you're going to college. Oh, you're starting a business. You know, like there's so much, of a culture around, yay, you're doing the thing. And we, we should celebrate more like, hey, you see that this is not the path and you're pivoting. I mean, like, maybe that's another word of it is celebrating successful pivots because life requires you to successfully pivot a ton.
Oh yeah.
Yeah. Especially now. I mean, the world's changing at such a pace that like, you, you gotta learn how to do this. Jason, number 3.
Yeah.
Give us number 3, man.
Yeah, we've talked about this. And by the way, just read the list of panzerisms on my Twitter. I mean, this is, it's all the same stuff as we're talking about here, but you know, your network is your net worth and there's nuance to it. So like, let's not just, let's just, let's break it down really quick. And first of all, I wish I would have been better at this when I was younger. I was good enough. I was good enough in the sense that every job I've ever had, in my life, including like my very first job as a lawyer at Skadden, was through my network, like through someone that introduced me to someone, and then I got my foot in the door. You know, I graduated from a top 20 law school. Skadden was a top, top, top firm. They took 4 people from my school. There were like 100 people way more qualified than me to get that job, but I got it and I kicked ass when I was there. So they made the right move, but You know, it was, it was just because I was, I knew people and I've had relationships, but I didn't do it enough. Um, when I was younger, I just, I must say I kind of got lucky, probably because I built my resume over time and it just sort of stood on its own, but I could have been way better at that. And it's like, you all know this guy in college that could, could like totally pull girls, and you look at him and you're like, what is the deal with this guy? Like, he just doesn't look any special, right? He just had like insane rap, you know? Like, that, that's like— and these guys are all really successful, and girls are all really successful because they had insane rap. But they, they weren't afraid to talk to people, and, and that's, that's like a real gift, and you just have to get out there and do it. But, but one more thing to add to it is that the relationships that you build They need to be authentic and you need to be authentic, right? There's a lot of that BS networking out there, and like, you need people just to get it, and then they find you out. And like, so you build authentic relationships, you build a bank of favors. I see this in golf, right? Like, since I got into golf, I belong to some really great golf clubs. You meet people and you want— everyone wants to go play like the best clubs, right? So what you do is you built this great golf network, But it's like give and take, right? Oh, I'll host you here and you take me to yours. And along the way you make really great friendships and really great connections. And that, what you do in the golf world, it's the same in the business world. And you just got to put in the time for this. You just, this is like a time thing. You got to put in the time and do it, but you have to be authentic when you do it.
I didn't start, Jason, investing in, like, actually deliberately investing in network until my early 30s. And then my only regret was that I would've started in my 20s. Like, I started my first company when I was 26, 26. Uh, and then by the time I was like 32, 33, I was like actually going and trying to sort of build network and invest in relationships. And it's crazy, I can almost trace all of my financial success to network. Like, it's literally like the answer to all of my problems has always been who. And I didn't realize that until I was older. So like, I would absolutely tell my younger self this one.
Yeah. The one only thing I'll add here is that we talk a lot about intellectual capital, financial capital. We really don't talk enough about relational capital. And one of the things that I think helped make Simple Modern successful, in fact, I know helped make us successful is the initial team of people I was able to recruit. But the reason I was able to recruit those is I spent my 20s and my early 30s developing a lot of relational capital with people that I really respected and high-capability people that I was then able to go and recruit. And then there were other people in my network that ended up playing key roles from outside of the company. And I think it's absolutely true about life, but also about business that The quality of your relationship network directly impacts how successful you'll be. And especially now that the company's been successful, I find this to be true in a different way, which is my quality of life is directly proportional to the quality of relationships I have around me and the type of people I'm connected with. I mean, even if you think about it, this podcast is a result of that. It's the result of a text thread, kind of a networking text thread. That turned into a podcast and has become really valued relationships in my life. And obviously it's been great for me on the business side of things as well.
And by the way, shout out to Sean on that because Sean, talk about being an authentic networker. You know, that's why we're sitting here, right?
Because he just, we started text groups, right? During COVID because of Sean. So like people, 100%, man.
He's a great example too of like, He is networked and he learns from people all the time. And so I think he's been able to translate it into business success from Ridge because he's able to gather so much context and information that he doesn't have within his company, but getting it from other people. So he's, not only has it brought community, but he's able to turn it into dollars.
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Number 4, your first product should be a copy. This will be very controversial. People will hate, hate this advice, but like the goal early on, I think, is to get up and test your general market theory as quickly as possible. Um, and maybe if you're in certain categories where you're doing something totally unique and bespoke, you can't do this. But generally, like if you're going into an established category, and I, I think 99% of entrepreneurship is you're selling some derivative of something that already exists, the easiest thing to do is to test your value proposition as quickly and as inexpensively as possible. And that means you're probably going to want to more grab something off the shelf. Uh, with Simple Modern, this was, we started selling drinkware and the very first drinkware we sold was off the shelf from a manufacturer. There was nothing special about it, but we had some ideas around style and around channel and around pricing. We tested those, and then when we figured out that we were right about those is when we really started to lean into product development. The other reason for this with, uh, especially when you're in hard goods, things that involve molds, is that these are, you know, at the very least 9 to 12 month processes, often multi-year processes to bring things to Um, you know, for example, like I've got a new piece of our drinkware here. This was probably a couple years that we were working on this to get it where we wanted it to be. So first you test the theory, you make sure that you've got the right kind of positioning in the market, then you lean into the differentiation. So imitate, then deviate.
I don't, uh, I got nothing to add to that one. Uh, as a guy who has done both, I have made a completely new product that the world didn't know it wanted. And a guy who's made products that have like existing categories that are basically just better versions of, I would always take the latter. It is easier to just do the latter. Uh, all right, Jason, number 5, my man. What is number 5?
Yeah, cash is king. Cash is oxygen. It's different than profit. Cash is not profit. Um, and you can see the struggles and this is really specific to consumer, right? Because I was in the tech world for a long time. And it actually kind of was a really rude awakening and slap in the face when I got into consumer. You know, a lot of these tech businesses have negative working capital requirements. Well, you know, that ain't the same in consumer and you could have really good margins and still run out of money. And this is, you know, not a fault necessarily of being a good product guy or being a good marketer. You could be great at product, you can be great at marketing, but like, you could run out of money. You could bankrupt your company. You know, it happens. I mean, it almost, luckily, like when in my first year at Here, when we were kicking ass and we're like, you know, oh, let's take out some money. And we did.
It was like, wow.
Wow.
Wait a minute.
That EBITDA margin ain't the same as cash, right? There's a cash conversion cycle. There's working, You just need working capital in this kind of, in this business. So you just got to know. And that's why when people think about like starting, they want to just like start a business and they don't have any cash and they're like, well, how come I can't build a business? You need capital. Businesses need capital. And in this business even more, right? So we hear it all the time. It's one of the things that people really struggle with in this business. It's just hard, right? So just know going in, that you, you're going to need cash. There's, you cannot doing things on a shoestring. This isn't like tech where you could be in the garage writing code. You know, this is like, you got to buy stuff, you got to build stuff and you just don't go into it. Think, and then, and then don't get all punch drunk. Don't get drunk on, uh, your, on your nice margins, like run your business based on cash. in the bank.
Yeah, it's, uh, did you— I don't know if you guys heard the— that was Zach Stucke's sort of like more contrarian take at the end of his Titans app, is that profit doesn't matter, it's cash. And I would actually argue, Jason, that outside of getting distribution, so like marketing and getting reach and making that whole engine work, that being the most difficult thing in this game, I would say a close second would be cash management. And how hard these businesses are on the actual money in the bank. Mike, would you, what would you agree, disagree, or what would you add to this one?
The thing that most people are not prepared for when they come into starting a consumer business, because it's counterintuitive, is the way that growing and the tax treatment of inventory is really disadvantageous. And you just end up having less money than you think you will. Um, and it, it's like, it's one thing to kind of even intellectually understand, hey, that's a thing. And then to go through it where you're like, you feel like you're just really kicking ass and then there's just no, and you don't have enough cash. And it's like, how, this doesn't make any sense. Like, I feel this dissonance emotionally of like, why can it seem like things are going so well? My CFO is telling me we don't have enough money. And the other thing I would say here is that, you know, cash is one of those things that when you have a lot of it, everybody wants to give you more. Right now, like I got a FedEx at my house yesterday and I'm like, huh, what is this? And it's like, oh, you know, this big, huge multinational bank really wants to be your private banker. That's the kind of stuff that happens when you have a lot of money. It's like everybody wants to give you money. Everybody wants to bank you. When you are short on cash, you know, nobody wants to talk to you. And the number one piece of advice here is don't get yourself in a place where you're really cash crunched. Do everything you can to avoid it. Because that's when, from our experience, smaller brands get strangled off in their growth curve, is that there's a bump in the road and they take some kind of a short-term financing at 25% ARR or something, and then you get caught in this negative feedback loop. So you really have to learn to value your cash. And I think that the skillset that requires is being very good at capital allocation and investments. You start to get really discerning, and it's about saying no to a lot of things you could spend cash on that one additional hire, that kind of mildly incremental product category to really focus on the best stuff. You have to kind of concentrate your cash.
Mike, that's the real takeaway from this. Like when you do have money, it's like so tempting to spend it. Come on, you know it, right? You like get some money, you wanna go buy stuff, you wanna go spend it. People want it. And the bigger you get, people wanna spend more money. And you just have to be like insanely disciplined about spend for Forever. It sucks, but, but you have to do it.
Yeah.
Jason, you got HexGlad has been so good at this. Like you guys are so good at saying no to doing stuff.
You have to, it's just like, here's what it is. Like our minimum margin is X and we're not going to spend below that. Or, you know, we're not going to spend any money if we're, if we're dipping below. And, but, but we're willing to spend money over that threshold. And it's just like, it is an absolute like line in the sand. that can't be crossed. You, you gotta, you gotta figure that out for your business.
And somebody in the organization has to be, um, the no person, and they're not going to be very popular a lot of the time because they're the dream killer. You know, we, we have the joke that, um, our, our general counsel, uh, his nickname's the dream killer. And like, you know, that is so good. Whoever, whoever watches the cash is the dream killer in the organization, you know? And, but you have to have it. Or you'll just, you'll just plow all your cash into marginal investments and then you'll find yourself cash-strapped.
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Let's do number 6. This is a little different. Uh, so Alex Beller from Postscript posted this yesterday that at Postscript they've got a memo culture, right? It's like everything gets written down. I have a very firm belief that it's hard to be a good leader, a good CEO, a good founder, a good anything if you do not write. I, I write every day. I write for 30 minutes to 60 minutes every single morning. I think, I mean, Amazon did this. Bezos was like a big memo culture guy. I think it helps you think clearly. I don't know how people think clearly if they don't write stuff down. We live very busy lives. When you're running a company, building a company, it's a lot of chaos all the time. And to me, writing is the best way to get clear on all of that. So that's number 6.
I love this one. You know, I went to law school and I learned how to write. And it's funny because when I see how we— you tweeted about this, Matt, and I actually responded. I'm never on Twitter or anything. I actually responded because I love what you wrote. Because when I write stuff, which is a lot, it kind of sounds like AI could have written it because like I learned to write, you know, like it's not AI. It's like, and so I know when someone else says to be AI because it's like, it sounds like me and it's not right. But, you know, we struggle. I'm struggling now with, you know, like everyone is, like how to manage your business better, right? And there's a lot of, like a lot of conversations that happen that I feel like it's great that things are being recorded now and you can do stuff with it, but like writing stuff down, it just makes you more productive. You know, having a pre-read in a meeting, you know, someone had to take the time to write it down. So that the meeting goes a lot faster and you just go in and you make decisions. And the good news is I do think that AI helps solve this problem. I'm seeing all kinds of people in my organization that always seemed to me to be very unproductive and they're using Claude and they're putting out good work products. I think it is enabling people, but yes, organizing your thoughts. And writing them down is a real skill and a real talent in so many ways, especially like just in general, like being a good communicator, you know, being a good writer, taking the time to do it. It's a little bit of a lost art, but it's incredibly valuable.
I think, Mike, you and I share this, that we're external thinkers. So like we think by talking with people, right? And Once I've, once I learned that about myself, that's when writing became super useful. And what Jason's hitting on, and I don't know if you share the same experience, Mike, where if you can build this culturally in your company, and that's why I like that Alex from Postscript said this, you can build this culturally, like communication does get easier. So as you add more people, and we know that adding more people creates more lines and it's more complex, that if you build this culture of like memos and just try to write very succinctly, that, that will help you scale an organization up. Do you, what's your take on this one, Mike? I'm curious because you're strong.
Yeah, I would start here in saying, in general, writing is asymmetric and we talk about asymmetric things are really valuable. And the idea is I write it once, but a million, a billion people could hypothetically read it. And so doing, spending your time on asymmetric things is like really, really good. Just in general, like that's where you want to be putting your time. And if you write something that really resonates on the internet, you know, scores of people can read it, be influenced by it, be inspired to connect with you. So I think there's kind of a general, you know, like for you as a person, whether that's in your business or just in general, there's all kinds of opportunities that come from writing. What I think writing does, and I think this is what you were saying, Matt, is that like I did debate in high school and the best thing about debate is that they'd give you kind of a topic and you'd argue one side and then you'd have to— Explains a lot, Mike.
This explains a lot.
Yeah, I know.
He's good at debating.
Well, but it really, it, I think it was the frame for like how I came to learn a bunch of this stuff. But the thing I liked about debate is that it really made you externally process through both sides of an issue. And what writing does for me a lot of the times is I'll start to write something And I'll read it and I'll be like, uh, I'm not quite satisfied. Or, oh, I, I don't actually have as much clarity of thought as I thought I had about this thing. And I have to kind of keep beating it up until I have internal quality of thought. And from that point on, it's very easy for me to speak about that thing because I have now done the work internally to be able to really know what I think about it. A lot of times people have thought 30 or 40% of the way through an issue. And so when they try and write about it, it's not very good because the quality of thought's not very good and they haven't put in the work. The one other point I would make here, and I think that this is more important than ever before in an AI world, is that I think that AI can be a great tool to accentuate you if you already have a strong voice and you can only have a strong voice by going through and doing the work. So you have to do the work of beating yourself up and kind of like making sure that you internally have clarity about the way that you see the world and what you want to say, then you can layer on technology on top of that to make the actual process of turning that thought into words easier. But the AI can't replace quality of thought and voice. And so that's, that's been for me the best thing about X and all of the writing I've done is that it probably prepared me to be able to be the kind of speaker, the kind of podcast host that I am today.
You know what's really funny? Just to add to that, Mike, you're an excellent speaker. Matt, you're an excellent speaker. I find that for me, it doesn't come as naturally when it's like sort of like an important topic. It's just banter. Yeah, great. But what I find is I have to— this goes back to writing. I have to write down a few things. And even like when it comes to debate, I'm actually a terrible debater. because I have really strong gut instincts that I think are generally always right, but putting those out in word, expressing them in words on the fly is actually challenging for me. And so, but when I take a step back and I write down my thoughts and organize my thoughts, they're incredibly effective, and that comes from writing. So that's just something that I find.
Within a company, Jason, if you think about it, you really have to codify things. You have to get them down in words. Like, even if you get everybody in your company in a room and you talk about a subject and everybody gets on the same page, if nobody writes it down, you know, there's actually— this has been a thing on Twitter. Like, being the guy that writes it down is like, in and of itself, just an incredibly powerful skill because it has to be documented. It has to be documented so that everybody has the same remembrance of what we agreed upon, so that the person that was on vacation knows about it, so that the new hire 3 months from now is aware of the decision we made, so that We can strip the emotion of the moment out of things. Like, I think you mentioned that, Jason. That's true. Like, writing gives you a, it gives you the kind of the time and the space to breathe. Whereas in a back and forth conversation, sometimes emotions are higher and, you know, or a point that you really, it was kind of like just at the tip of your tongue, but you didn't know exactly how you wanted to say it or what you wanted to say. But then when you have the 2 hours to write, you're able to really clearly lay it out. So I, I think there's a huge part of it for it in companies, and I, I think that that'll continue to be incredibly important in, in the world ahead.
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All right, Mike, number 7, take it away.
Number 7, the market does not care. It doesn't care about your feelings. It doesn't care about you only having $15 in your checking account. It doesn't care that you haven't slept this week because you've been grinding away. It doesn't care about any of that. It cares about one thing. It cares about what it wants. It cares about the value that you can deliver to it, and it is ready and willing to reward you when you do that. But it's only going to reward you when you give it what it wants. And no amount of hard work, sacrifice, want-to, drive, grinding is going to substitute you giving it what it wants. And so learning to be very market-focused is the name of the game. And this is a delivery output game. This is a performance game. There's a Netflix culture doc that I've referenced several times.
I really love it.
But one of my favorite things they say in there is that in their company, it is strictly based on output. They do not care how many hours you work every week. They only care about the output. And the market is the exact same way. Doesn't care.
Doesn't care.
how many hours or how much effort or how much capital it took for you to get the solution it likes. It just cares, did you gimme what I wanted? And this goes back to several of the other points. Like when the market is telling you it wants something, you should lean in, you should double down, you should go faster. And then when the market is not, when the market's throwing up a yield sign or a stop sign, you have to listen to it. And often we get this idea that persistence means that even when the market's telling me stop, I need to just floor it. And that's exactly how you go bankrupt. That's exactly how you waste 5 years of your life on a project the market doesn't want you to solve. One simple, like, way I'm putting this to my team guys is that the extent to which a market wants, the market wants a problem solved is the margin for error that you have in your business. The extent that the market wants a problem solved is the margin for error you have in the, in a business. So you've gotta learn to listen to the market, And really respond to what it's asking you to do when you grow your business.
I think this is another thing that Jason, you guys do so well.
Well, this is the biggest problem in life right now. This is the biggest problem in society right now is that we're trying to solve things without understanding how markets work, right? Um, doing, doing like government-controlled grocery stores in New York City, are you Yeah.
Yeah.
Have you not?
Perfect example.
Soviet Russia. Like there are so many people out there that just don't understand it and they just don't buy into the fact that like, this is just the way it works since the beginning of time, right? Markets have been there since the beginning of time and understanding how markets work are going to make you a lot of money and save you a lot of headache.
I love this one. Jason, why don't you take us to number 8? Because I think this is—
I mean, the higher, higher slow, fire fast thing has been like a very difficult lesson for me. And fortunately, it hasn't like really— it hasn't done any major damage. But, but boy, you know, could we have done so many things better? By, by like, just like really being careful with, with who we're hiring, really vetting them, you know, really like really discussing people, um, versus, you know, oh, we need someone in that seat. You know, we got to get someone in that seat ASAP because there's so much work to be done. And I look back to 2021 and 2022. When we didn't hire fast, frankly, because we didn't have the time. Like, I didn't have the time to interview anyone, you know? And it was like, oh, we're leaving so much money on the table because we don't have people to do stuff. But then you go and hire bad people and it doesn't get better, right? And don't get me wrong, we hired a lot of great people. We've got a great team, but like the few bad apples, it's like, wow. And there's like, they cause drama, right? Which is the other category. Like, You're hiring someone to fit a role and either cause drama or they're not very good. And it's like, what a mess, you know, you've created. So like, just, you gotta really, really, really take the time as much as it's like, as you're dying to hire people in a role, you gotta be just like incredibly diligent and methodical about it. And then you gotta fire people fast, right? Like, if someone is a drama person, Like you just, you just know it and you just got to figure it, figure out a way. Um, you just got to figure out a way to get rid of them fast.
I have a friend right now who runs a very successful company, but they've had a lot of churn in the last month, like a lot of churn. Some of it, they, you know, actioned some people out and some of it, a lot of it is just people leaving. And the misdiagnosis was like, oh, it's, it's a cultural problem. And I actually think that when you see this in companies, it's really a hiring problem is that like you're letting people through the front door that shouldn't even be let in. And that it's very much worth, I think, Jason, what you're saying in investing in a proper hiring process. So like something that is consistent, it is repeatable, it is measurable, it's more objective than subjective. I think that is so valuable if you're gonna build a team. You should take your damn time and do that part of the building as good as you possibly can and refine that. It'll make the backend of this much easier. It'll make it easier to fire people quickly, right? People will stick around because you're doing a better job of bringing in the right people. Um, I think it just compounds. Mike, what do you say on this one?
I think that there was a period in time when to scale your brand, you just absolutely had to get more hours and more hands. And I also think that I've been at a lot of events for business owners where one of the first questions they ask is, how many people work for you? And that's kind of like a badge of honor. And I think that used to be the way that the world worked, that success was, yeah, it's somewhat your top line, but it's like, how many people really do you kind of report to you or whatever? And I don't think that's the way that the world is going to work in the future. My advice now to people would be that the smaller your team, like it's an inherent advantage to have a smaller team because communication loops are quicker, decision loops are quicker, actions get taken quicker, and less things get dropped. And that you should expand basically as a last resort, the number of people in the room. And that when you have a problem that you're like, man, I really need to put more towards X, You should first and foremost say, can I answer this problem through better system design, technology, whatever? And then when you really have convinced yourself that you cannot solve the problem at the quality level you need to, that then you hire. And I'm not against adding great team members, but I would have a bias towards being very, very slow to add, which that's the first part of what you said, Jason. Like, Let's be honest. When we fire, it's 2 different reasons why you can fire. One is that you've got the wrong person. They don't have the qualities you need or whatever else. They've changed in a way where they're not demonstrating the qualities you need. But at least 50% of the time, maybe more, it's because actually the organization doesn't need that person to do what you've been paying them to do. And that's on the organization. Right? How many times is it like, man, we need to actually reorg. We need to let this person go because we overhired because we thought we needed X and we didn't really need it. And those are really painful. Like, it's not fun to disrupt somebody's life that way. So I would just be very slow to hire and I would challenge yourself to do as much as you can with as few people and as much system building as you possibly can. And this is the overarching theme of everything I'm saying inside of Simple Modern is that everybody should become a system builder. And as they are, I think what we're seeing is that, uh, we're just able to do way more with a, with a tight group of people.
Yeah, I love that one. It's, we're all, we're all, AI is sort of forcing us all to be workflow people. It like much more deliberate, much more intentional workflow people, which I think is turning us all into software designers in a way. Yes. Yeah, yeah, totally. Which is what software is.
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All right, number 9, and this one might piss some people off. Let's find out. All marketing should make money. All marketing. So that I don't care if you're a brand marketing person, a performance marketing person, if you are doing marketing that does not make money, that is a freaking art project. That is not marketing. Okay? The only difference between brand and performance is the time to return, but all marketing should make you money.
Period.
Full stop. Fight me on it if you want. I'll be on Twitter or X, whatever the hell we're calling it these days. But that is, I, I hold the line there. I'm willing to die on that hill, boys.
I don't even think that's controversial. Like, why would you ever spend money that you thought you wouldn't get back?
You gotta meet some brand people.
Uh, well, I mean, it's like, we're not running nonprofits here. Like everybody, I, I don't know why anybody would spend any dollar on marketing that they didn't think in some way was gonna come back. I think that the issue is a lot of the more brand marketing, it can be kind of hand-wavy with how it's gonna come back. It's just kind of like, well, you know, we do this crazy thing where we give our top 100 customers a horse and somehow, you know, it's gonna go viral and like, we're gonna like make all this money. And, you know, and you're like, well, how? And they're like, nobody knows, but it will. And that's probably the part of like, I think the big thing here for me, Matt, is that, you know, on a spectrum of like, I know I'm getting a return to like, I have no idea, I'm kind of firing this you know, campaign out into the ether and just kind of my strategy is hope that it comes back to us. You want to live more on the side of the spectrum of like, you can really verify that this is actually leading to the outcome that you want.
Well, verify, that's the term, right? Like the term that I would use is measurement that you, it's very hard to measure some of this brand spend, right? So that's, but that's the problem here. But clearly, like, you can let people who aren't data-oriented or people who just aren't like really numbers-focused, yeah, I mean, they can figure out ways. Like, there's a lot of creative people out there. It doesn't mean that they can make money, right? So you gotta have the right people in the room. You have to have, you want the creatives on your team and hopefully you can get them to think commercially too. Like we have, a great head of content here at HexClad, and more and more he's become more commercial even though he's an artist, right? And so that's the key. And I think that's absolutely the truth. It's just all about measurement.
All right, Mike, take us away, man. Number 10.
Before we do, I just wanna say this is probably the spiciest thing I could say about this subject. It's a way to take it. Here's my spiciest take on this. Everybody in your organization is going to have things that they want to do that are not to your organization's benefit. They're to that person's benefit that they think, oh, it would be so cool to do this type of creative. I don't know if it would actually back out, but I've always wanted to do X. I've always wanted to meet Y celebrity. We should do a collab with them. You know, you could go on and on. Oh, I like, I really want to design a product that has this kind of feature. I don't know if the customers really want it. It might be really expensive, but I just, I want to see if we can do it. There is so much of that out there. We all have interests that are our own and don't necessarily align with our companies. And you really have to lead your company where you deeply incentivize them to do the things that are in the company and the company's profitability's best interest. And all of those hobbies, those go outside of work and you gotta shut those down and you gotta prevent people from doing things that, um, aren't really serving the company, but are serving them. I see this Uh, with myself even, you know, you'll see, you'll see CEOs do this all the time where they do stuff for vanity reasons and not because it's what's best for the company. And, uh, like be on a podcast, for example. And, uh, just kidding. Uh, kind of, maybe, I don't know. Um, but the point being like, that's actually one of the biggest things you've gotta manage. And I think that that's actually what you're getting to here, Matt, is that sometimes you get people in marketing that have ideas where they're really excited about the idea for creative reasons and not necessarily for business reasons. And, but I would just make the point that happens everywhere, happens in every different part.
Yeah, I think that's a great point, Mike. Uh, I, I, I tend to be a marketing-first everything. Um, but you are right.
It works.
It, this, this as a principle sort of works across the whole organization. All right, Mike, take, take us to number 10.
Yeah, absolutely. So, uh, strong positions loosely held. The idea is, as a leader, you have to have a strong point of view and really your job is to, in the ambiguity, in, uh, the times that you really need direction to be able to set that. And that requires, I think, having strong values, strong mission, strong vision, and certain things that you're like, I have them in an iron fist and I will never— you will have to pry them out of my dead hands. Like we in my company, we are going to be committed to generosity and I will fight you over that. You know, that is my hill to die on. But tactics, the execution of strategy, trends, Those can't be things that you hold in the iron fist because those things change. And like, so as a leader, I think what I've learned is that you have to have a few things that you're like, no matter what happens, no matter what AI does, no matter who's in the White House, no matter what our competitors are doing, these things are going to be true. These principles are going to guide the way that we run the business. But then everything else we're going to hold with open hands because we know that it'll change and it needs to be flexible. Another way that I've said the same point is that as a CEO, I think one of the ditches you can fall into is this hubris of it's always my way or the highway. And so being a good CEO is about being able to listen to the feedback of the market and your team or whatever, and to be flexible and to go with the suggestions of others 95% of the time. And then 5% of the time to be like, I don't care what anybody's saying. We are not doing that. I will not listen to you. My, you know, I'm putting my fingers in my ears and knowing what that 5% of the time is that you're like, no, under no circumstances will I compromise on this point. Um, that, that's actually what makes great leaders.
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Yeah, this is a good one. This is consistency beats genius. You know, some of the most successful people I know, um, they're, they're, they're definitely not the smartest people I know. You can help. Moreover, there's a lot of smart people that aren't super successful, right? And it's like, you know, there is, there's, there is a level of like, from the, you can call it consistency, you know, you can call it like just grinding. Um, and look, you can't just grind your way out of anything, right? But grinding really, really helps. And that's, that's to me, consistency and grinding are almost synonymous.
Yeah.
Like when I started my career as an M&A lawyer, I worked at a really big firm and, you know, there were 60 people in my entering class and like we didn't even email documents back then. That's how old I am. We literally like would fax documents and hand deliver documents and, you know, doing those little things right, like really consistently got you to move up really, really fast in the organization. And like you could be a first-year associate running deals or you can be a first-year associate making copies. The issue there or the differentiator there was like being really consistent at doing things right. And I think that kind of, that just transcends everything you do, right? Just being really consistent, really grinding at it, adding that to like all these other principles, know when to give up, right? But just like being really, if you look at the HexClad journey, the journey of the co-founders of HexClad, man, You know, everybody told them it wasn't gonna work. You know, nobody wanted to give 'em money. You know, they just kept after it and kept after it. And I think from the time that they decided, hey, we've got this great cookware, you know, there were many reasons to quit. You know, there are many reasons to not do it, but they consistently grinded at it, ground it out. And that's how it became Well, what it is today.
You know, I can expand on this a little bit. The, I think e-commerce, consumer, D2C, whatever we're calling it, is blue-collar internet work. I like this framing. And if you think of all blue-collar work, right, to do that work well means that you're doing a lot of like seemingly mundane and boring things. But the reality is that in, in this game that we play, Most success, most winning is found, is found in just showing up every day and doing a lot of boring things consistently. And that over time that those things do actually add up to what we've talked about. Your brand mark and your equity matters. Um, and that you can actually generate the margin. All of it just comes down to like cons— just consistency. So I, I completely agree with this one. I just think that in, in consumer it matters a lot 'cause it is blue collar work. That we do. Mike, what do you think?
I think the earlier when we were talking about brand building and why it's such a long process, it's because you, you, it's, you're building a house brick by brick and you're doing the right thing over and over again for a really long time. And every day that you do it, you add a few more people that know who you are and care about your brand. And you can look up after a really long period of time and realize that you've built something pretty special. And I really think that We have a culture where on the kind of D2CX and other platforms, it's like, what is hot? What is new? What is working right now? And there is something to be said for that. But I really don't know any company that's, that their playbook and their success that is really built off of constantly riding the next newest wave. I think the really great companies, it's, you just see an engine of predictable growth being churned out by doing the right thing over and over and over again. And one thing I would say here is that this also ties in with some of the hiring things we've talked about. If you want consistency in your organization's performance, you're going to need consistency in your internal team and processes. And so having a really solid, predictable team that's getting after it. I mean, for us, we had all these people that I, this group of people that I hired at the very beginning, and almost all of them are still at the company and we've just been getting after it. 11 years now. And, uh, and, and every year we, we get a little bit smarter and a little bit better.
You know, I'll, I'll finish off this, this episode. I'll give you guys number 12, but I think it actually follows this whole consistency thing really well. And number 12 is you have to talk to your customers until it hurts. Uh, it weirds people out, guys. It weirds them out when I tell people that I read every review and every comment, and that I have a stream of customer feedback Thank you, AI, where I can just dashboard. Here's everything that is being said about us at all times. And I spend a weird amount of time doing that. Early on, I would literally call customers. We would send out thank you videos one by one. There is so much value in this seemingly boring work of talking to your customers. And for some reason we don't, I think as you get bigger, we lose this. But the very best operators I know in consumer are obsessive about what their customers are saying. It's where all your best marketing comes from. It's where all your product improvement is going to come from. It is just listening to your damn customers and how they speak about your product and about your brand naturally.
Yeah, I love that. I mean, that's something that we, we surprisingly, I think, could be way better at here. You know, like we have, and we're, we have so much information, you know, we have so many reviews. Um, that, uh, you know, there's so much, there's just so much, there's just gold there, you know, it's, it's worth some being someone's full-time job, honestly.
Dude, I think if the CEO is in charge of growth, which I think that that's true, uh, I don't know how you grow a consumer brand if the CEO doesn't know what the consumer is thinking and saying about the brand like that. And that might be a more controversial take that like, I think this is one of those things is very hard to 100% outsourced. You can have somebody who's accountable to it internally. Like there, there should be like a head of customer in the business of whatever that role is called. But you, the, the founder, you, the CEO should have a pretty good pulse on this at all times.
As a great illustration of this, one of Simple Modern's huge advantages is, um, our spouses, uh, because the, the target market that we serve and the person that's had the best insights about strategy in Simple Modern Doesn't work for the company. It's been my wife. It's been my wife. And like, uh, it's amazing.
Don't kiss Mike.
I mean, she's not listening. Listen, she, it's funny. It's like there was a point, um, when we made the decision to get into kids where she was like, you should do this and you should do it exactly like this. And she was completely right. And a couple years ago, she gave me another, uh, very controversial piece of advice about the company that I kind of sat on. And the last 2 years have completely validated that she had the right insight. But the reason why she was right actually is, I mean, she's very smart, but it's less about intelligence and it's more that she's the customer. She's inside the mind of the customer. And so her insight and feel for the brand is actually even better than mine. And that's kind of what you're saying, Matt. I mean, really what it gets back to is like, what do you think you get paid the money for? You're getting paid the money to serve the needs and the problems of your customers. So the idea that anything else would be more important than knowing what the needs and the problems your customers want solved is, is kind of insane in and of itself. Like, that's what the money's for. And so you've got to find ways to be in touch with that.
I always love that line. You guys ever watch Mad Men?
Oh, that's when I was—
where she's asking for what is— she's like, you don't appreciate me. He's like, that's what the money's for.
She's like, you never tell me how much you like me.
All right.
Uh, I think that's a wrap, guys. That's, that's 12, like solid lessons on how to win in e-commerce. I would actually say it's also 12 areas that a lot of mistakes are made. Uh, so this is good. I learned a lot. I think that's the pod.