Welcome back to another episode of the Brand Builder Show!
This week you’re in for a treat as we’re joined by Bryan Porter, co-founder of 9-figure drinkware brand Simple Modern.
In this episode we discussed:
- How Simple Modern are sustaining 100% growth year on year
- How offering more variations of your products can drive substantially more revenue
- The clever technique Bryan used to secure licensing deals with Disney, the NBA, NFL and more
- Why Bryan believes generosity has been a core driver of the brand’s success
- The $5million investment Simple Modern has made into domestic US manufacturing
- And so much more!
A not to miss episode!
If you got this far, there’s a chance you enjoyed the episode… if so, please consider leaving a review – we really appreciate it!
00:00 Introducing Bryan Porter
06:26 Staring Simple Modern
08:25 Opportunities in Drinksware
14:18 Amazon percentage volume
16:59 1P Seller on Amazon
21:36 Business expectations
23:44 Manufacturing strategy
27:25 US vs China Manufacturing
30:26 Building a brand’s community
34:02 Protecting product development
37:17 Business principle
44:03 Product Licensing
48:27 Maintaining a good working relationship
51:19 Future Plans
Hey folks, welcome back to another episode of The Brand Builder show is a great honor and privilege to have Bryan on the show with us today. Bryan, welcome to the show.
Bryan Porter 00:09
Thanks for having me on. It’s an honor.
Ben Donovan 00:11
I’m so excited to dive into the journey of Simple Modern, this, you know, crazy big company that you have co founded and going to be picking loads of thoughts up in this episode and trying to learn as much as we can got loads of questions for you had some questions submitted from the Twitter family as well, we got some real good questions to grill you with today. But before we get into that, can you give us a little bit of a background on yourself who you are your journey up until the point of launching Simple Modern, maybe a bit of a, you know, background on what you’re doing? And then we’ll dive into the whole Simple Modern journey after that?
Bryan Porter 00:51
Yeah, absolutely. Well, first, I’ll introduce Simple Modern in my role with the company. If you aren’t familiar, we are primarily an adult and Kid drinkware company, we make products for the entire family. But drinkware is where we have had our most distribution. We started in 2015, my co founder of the company alongside Mike Beckham, who’s the CEO in my games, who’s our chief product officer. And, yeah, we, as of this year, we project to do over a million units. In the next year, we actually think that we made double. So we’ve been writing away, just hypergrowth pretty much the existence of the company. But we’re getting to a scale where it’s it’s a different ballgame for sure the nominal amount of units is getting to be pretty big. So a bit of a background on how we launched in 2015. And for myself. out of college, I worked at a company called Quibids. We launched in 2010. And that’s that’s when I graduated, we experienced hyper growth with that company. It was actually founded by Mike and his brother, Matt. So I knew Mike previously, and we worked together for about seven years on that project. And we really saw just the scale that online advertising can provide. We had just an enormous gap between our customer acquisition cost and lifetime values at the start of the company. In 2010, internet marketing, digital advertising was completely different than it is now. They’re different, a lot more saturation now than there was then. So we benefited greatly from that.
Bryan Porter 02:58
The business is an was an auction, I guess is it still it still exists. It’s an auction business. So you can tell it really big saving story. And it’s great for marketing. So we we had an epic write up. And really kind of what happened with that business is that saturation started to happen with our advertising, customer acquisition cost came up. So really, the unlimited marketing budget that we had, became limited. And that combined with just that it’s hard model to retain users with there’s a lot of attrition of cohorts. So eventually, when your existing users don’t show up anymore, and new users are harder to come by, it’s pretty obvious what’s going to happen. So that really formulated a lot of our thought process around advertising. And it really shifted our perspective to wanting to create a product instead of a platform because we we liked that product was something that added value to the world. It’s if we can make someone’s day a little bit better with our product, we want to do that. It’s tangible. And, you know, advertising, you’re just giving money to the advertisers, we want to pass along value to the customers. So it was a great introduction. Ecommerce, we launched other websites. We built algorithms, it really prepared us to launch products on Amazon. There’s nothing better than to understanding how the Amazon algorithm works than writing an algorithm yourself. So that was a precursor to Simple Modern and really the reason why we started it is that Mike and I we are really after the same things personally we we want to be the best The best people we can be we value growth personally and professionally, we want to be great husbands, dads. And really I wanted, Mike and Mike are our two guys that I just want to be like. So if I get more time around them, I’ll handcuff myself to them as much as possible. So I think the feeling was mutual, which is why we started a side project that became Simple Modern.
Ben Donovan 05:25
Yeah. And I think that’s really evident, you know, in your your Twitter content, is the personal drive to grow to be good leaders. It’s not just about here’s a hack to help you sell more units on Amazon, it’s actually how do we build a good company? How do we build a great team? How do we be good leaders in our company, so I think that’s evident for us all to see. And, you know, we’re all watching the journey and loving to, you know, to follow you in that. So thank you for, for sharing your journey in that respect. And, you know, I know there’s, there’s so much that we could go into here, and we’re going to try and, you know, cover as many of the, of the sorts of topics as we can in the in this time together. But you talked about your experience with algorithms, and with different sort of forms of advertising. You know, what was it particularly though about the, the market for drinkware that cause you to start simple mining? Because you could have started anything, you know, back then, but what was it in particular that caused you to start there?
Bryan Porter 06:26
Well, we we view ourselves more is a channel first company than a product first company, we didn’t have a dream one night that vacuum insulated drinkware was underserved. And we needed to make that product. We believe in our ability to sell on Amazon first. And so what we did is we cast a wide net with launching about 10 different products on Amazon, and just testing what did the best? And out of the things that did the best, is there a way for us to meet an area the market that’s currently not met? And the TLDR is that, you know, obviously, bottles back in the day bottles were the products that we’ve we found our way into, but there were several other products that did well. Instead of doing a lot of things. Well, we wanted to do one thing, great. And since we were limited with our resources or capital, we decided to walk away from the other things that were profitable, and just invest solely into bottles.
Ben Donovan 07:38
Yeah, which is a learning in itself. And I would definitely like to get to some of those scaling, conversations, capital intensive, you know, discussions a bit later on, because that’s something I think a lot of people want to hear about. When you talk about finding that opportunity in the market. What was it in particular that you found was drinks well, without obviously wanting to give away, you know, too many trade secrets. But so what because it’s a relatively generic product, obviously, 2015 was a long time ago in the Amazon space. So saturation, quote, unquote, was it was not like it is now it wasn’t maybe as competitive. But still, there were bottles on the market that was drink containers on the market. What was it that you guys saw as the opportunity that?
Bryan Porter 08:25
Well, to your point, I think the bottle was probably one of the first things ever invented, maybe along with the wheel. So there’s nothing, nothing new. The observation that we made was that and we’re open obviously, you can tell by my Twitter, we want to be open source and really helpful to other people. So the observation that we made was that bottles are more similar to like a watch or shoes, something that you take out with you to like the gym, or on a road trip, or wherever, and you want it to look nice for you want it to reflect part of your personality, match your clothes. Maybe you want a logo on it for your favorite team. It says there’s a heavy ornamentation component to the product. And what we saw in 2015, was that there were competitive great competitors like Yeti and Hydroflask and contigo, who had great distribution. There were other competitors, like manufacturers selling on Amazon at the lowest price that they can sell it at. There wasn’t really anything in between those two. So whenever we looked at the high high price competitors, like Yeti, they’re optimized for physical shelf space, so they’re not going to have the vast assortments they’re going to be incentivized to go very deep in inventory because the empty shelf space is the worst thing for them. So online, obviously, there’s no constraints to digital shelf space. And we found that the more ornamentations that we piled into a listing, the better that was for our conversion rates, the better chance there was for a customer to find what they wanted. Not only that, but adding more orientations into our listing provided more doors to our listing to get clicked into. So if we’re the only company selling the yellow water bottle on Amazon, and you search yellow water bottle, we’re gonna get 100% of that market. It’s a small market, but we’re gonna get all there. So what we did is we, we realized that the limits to Amazon showing swatches instead of the drop down for colors was 45 colors. So we took it right to the line for love. That’s really what we did with our capital as we expand it as much as we could in the colors and sizes. And sure enough, that was reflected in our organic placements, we found ourselves at the top of search terms like water bottle, water bottles, straw. So early on, that was that was the strategy in interestingly, what happened over time was as we gain volume, the incentive turned a little bit to were being out of stock. And our best SKU was more damaging than not having our worst 10 colors. So we kind of experienced as we scaled up kind of the the Yeti problem have you don’t go out of stock and your best skews. So we actually kind of shrink back our assortment to like, more like 25 to 30 Different colors, still plenty to choose from, but we’re able to be in stock better. Yeah.
Ben Donovan 11:47
One question that comes to mind is about the breaking point of that conversion rate, because I’ve heard it said before, offer too many variations. And it can affect your conversion rate negatively, I suppose for bottles when it’s very much the same product, just a different color. Sounds like you guys didn’t experience that.
Bryan Porter 12:07
And well, yes, we we test around decision fatigue a lot. We know that we can push customers to just be overwhelmed with the amount of options we have. And we experienced that a lot in our kids listings, especially because we’re licensed with Disney and frozen Star Wars Marvel. We have non licensed patterns, we have over 100 Different colors that have kids bottle or or pattern. So we’re constantly breaking those out into different listings to see how they place how they convert on their own. Because if you’re interested in a Star Wars kids bottle, it doesn’t matter if we have frozen and you know any other ornamentation in there, you’re only interested in Star Wars and being able to see all the options within Star Wars is important. So especially with licensing, I think you’re right that decision fatigue can negatively impact our conversion rates. And we’ve seen like, there are skews that we offer, where if our swatch looks more enticing than our main image, it actually drags down our listing as a whole. And so we look at what is the percentage of orders coming from a SKU compared to the percentage of plants views. And if a SKU is way under performing on orders compared to glance views, that’s an indication that it’s harmful to our conversion rate. And customers are they’re only clicking around so much and listing before they buy. So we don’t want any drag in our listings.
Ben Donovan 13:43
Yeah, you did a great Twitter thread on that, which I definitely recommend people checking out because it was, you know, lots of good info in there. You might have said before, but so just to clarify your your role in the company is marketing specific.
Bryan Porter 13:57
So my role in the company is over all of our digital sales. And as I mentioned, Mike is the CEO and Mike is our chief product officer. We have now a physical sales role that’s outside of my scope. I’m just focused on our digital sales.
Ben Donovan 14:18
As a percentage, how much of your volume would come from Amazon?
Bryan Porter 14:23
Well, it started off as 100%. Obviously, we have worked it down to being this year as a first year it’s going to be less than half of our revenue. And it’s not because our Amazon business is shrinking. It’s because our physical retail business is exploding. So a little bit of a shock to my pride, but I’m happy for that for that diversification to happen.
Ben Donovan 14:48
Yeah, as long as the gross volume still going up, you know, even if the percentage is coming down. Yeah, absolutely. It’s a great sign of brand strength, though, isn’t it as well. So do you get much volume through the Whether your own website or is it, just those two channels,
Bryan Porter 15:02
our website has grown at a faster rate than Amazon last few years really, when the pandemic hits is when that really started to be true. At this point, we’re about 10% of our Amazon sales for our website. So our goal is to continue growing it to be a higher percentage.
Ben Donovan 15:22
Yeah, I was doing a little bit of research before the episode and you guys have got really good branded search metrics. You know, Google has a lot of search for Simple Modern and which is, again, another great sign that the branding on Amazon is having an impact off of Amazon. So yeah, that’s good. And then in terms of global marketplaces, heavily in the US, or is there much global stuff happening?
Bryan Porter 15:46
We are solely in North America, it’s possible to buy our products in Europe, but you’re gonna pay a lot to get it over there. We actually had big plans prior to the pandemic to launch, really we were we got a lot of traction in Europe, we were about, we were up to about 5 million in revenue in Europe. We were strategizing on how to take that to 10 million the next year pandemic hits, Brexit hits. It basically crushed our European business along with mass retail exploding for us, we decided to put resources there. Although it’s actually an initiative of mine this year, to start that endeavor backup for Europe, Canada. And we’re looking to make partnership with Amazon in one P instead of the marketplace. Because we’ve had a lot of success with being a one P vendor Amazon in the US.
Ben Donovan 16:43
Yeah. Do you do one P, Three P in the US?
Bryan Porter 16:48
We are 99% one P. At first, we thought maybe we would try both. But we’ve just realized that it’s better for us to be all in on one p?
Ben Donovan 16:59
And how would that be? For someone like myself, who doesn’t have much experience with one p and for probably a lot of our listeners that are very much along with third party seller lines? What differences would that be for you guys? What benefits do you gain from being a first party seller to Amazon?
Bryan Porter 17:18
Wow, we could probably do a whole podcast about that question. But the difference is that we’re selling to Amazon and the same way we sell to target they’re buying our inventory from us with POs. We ship it to the to them, we fulfill their POs they own the inventory in their warehouses, and the customer buys from them instead of you know, in the marketplace, how FBA is just holding the inventory, and customers buy it from you. So the benefits for us have been that it’s added stability to the business. There are definitely downsides where we have lost flexibility with pricing with running deals, we have to be a lot more planned now. But it’s impossible for us to get our account suspended, which is great, because that was always viewed as like a potential kill shot. It’s not likely, but it’s possible. We actually had a near death experience with that. That’s a pretty epic story. But yeah, we, it forced us to touch all of our inventory, we were sending tons of products straight from China to FBA. Now we have to flow all the inventory through our product like our own supply chain domestically, which advanced the company forward in ways that we just had not been pushed to do. And it really kind of set the table for us to partner with Target and Walmart operationally. And really, the other thing that it provided that we wanted desperately was we didn’t want the black box that that the marketplace can be. We wanted people that we could talk to that work at Amazon that we can actually partner with them, instead of just being under the jurisdiction of seller. Seller compliance. We wanted to work together with them on how to make our business better. And that’s really what we’ve gotten with one.
Ben Donovan 19:19
Yeah, definitely do. What are the economics of it as well, if they place a PO? Does that mean they’re paying up front? What kind of terms do you get with them?
Bryan Porter 19:27
So we set the economics up to be even with her economics in the marketplace. The biggest difference is that in the marketplace, you pay a nominal fulfillment fee. In one P, Amazon gets a wholesale cost and they get accruals that are pretty much a percentage of sales. So as your ASP goes up there, you need to adjust your pricing accordingly if you want to be making the same economics since we’re making a percentage of sales shipping becomes less of an expense for higher priced items. So you can make it a push with marketplace economics, you just need to be diligent, and Amazon’s gonna push you to give them more. And, you know, it’s better for them that we’re healthy profitability wise. So we need to have firm boundaries, and we haven’t had any situations that had been untenable with Amazon so far with like terms.
Ben Donovan 20:31
Yeah. Okay. Yeah, cuz I like your sales. I’ve never never done first party. And so it’s all very new to me. But we’ve had some POS from like, Chewy, for example. And you would place they replace those and we send them and then there’s like a lump sum payment on net 30 terms. So you said that there is a lump sum for last or they still pay per unit as itself?
Bryan Porter 20:54
Yes, yes. They, they pay us whenever they pa we have payment terms that are net 75 days to actually get paid 75 days after? That’s definitely a worst in the marketplace where you can get paid every other week. But we’re able to get debt financing for that, which Yeah, makes it workable.
Ben Donovan 21:15
Yeah, for sure. Cool. All right. No, it’s just interesting to understand how that works. Good. When you were growing Simple Modern, the first year, two years, was there ever a point where you just realize this is going to be huge? Did you always think that from the start, was there a kind of point where you thought, Okay, this is gonna be big.
Bryan Porter 21:36
I think our expectations are constantly evolving. They started off as, let’s pay for our own salaries. Because we started off, it was a night job. We had day jobs, and we, you know, talk to China. And I did everything and I, and it took about a year for us to actually quit our jobs. So that was step number one. And we never dreamed that it would be as big as it is today. So every gosh, there’s data points throughout each year where we kind of reset our expectations. And I’ve learned that my brain cannot really comprehend like exponential growth. In the way that we’ve experienced it, there was a period where we have three leases on three different offices because we kept outgrowing offices. We tried to get the shortest terms as possible at our offices, but we still ended up with, you know, empty buildings we were paying for. But it’s really helped Mike, Mike Beckham is very much living in the future. Vision is one of his many strengths. So he did a great job of being, you know, six months a year out in front of where we were headed, which is really what you have to have to prepare for doubling every year, you know, 50% growth. Things are constantly changing in terms of headcount, and the ability to buy the inventory to support the sales. So the answer is, yes, a lot of times we kind of realized this is different than what we expected. But there wasn’t like a defining moment where like, oh, man, this this is going to be a leader hydration, globally.
Ben Donovan 23:26
Yeah. And you mentioned some of the pressures there of growth, because growth doubling every year sounds exciting, until you’ve got to deal with the cash flow. You know, the hours the manufacturing even, you know, you must have hit some challenges with manufacturing growing at that, right?
Bryan Porter 23:44
Yes, we have. Our strategy with manufacturing has been to partner on a very deep level with one manufacturer, which is works very well. There is a downside of that, where there’s a lot of risk, and if one manufacturer decides to not be aligned with with what we’re doing anymore, but we’ve really cultivated that relationship. We don’t want any of our partnerships to be just transactional. We want it to be relational, we want to know them. We work with them every day. So we value them in, they reciprocate so it’s, it’s really been that partnership is fueled our growth and it’s the only way that we could have done it. And they our manufacturers had a growth mindset along with us in a way where you know that we’re their biggest vendor and whenever we’re doubling year over year, they have to buy much more equipment, so you have to hire up or it’s they have to execute on it along with us. So I wouldn’t necessarily advise everyone to just have one manufacturer but if you find As a manufacturer, that’s excellent. And you trust them. There are benefits to scaling up just with that one partner.
Ben Donovan 25:07
Definitely, definitely the on the subject of manufacturing, I saw Mike talk about the potential or the progress you guys are making with manufacturing in the US having machinery made and shipped over that kind of thing. Any other sort of background you can give us on that? How that’s going? And what kind of started that process?
Bryan Porter 25:27
Absolutely. So yes, we’ve we’ve bought about $5 million worth of machinery. We’re headquartered in Oklahoma City. In we we found a warehouse about 100,000 square foot warehouse, where we’re putting these machines. And our plan is to start with production for plastics, plastic bottles. That is a much easier bite to take than steel manufacturing. And with plastic bottles, we sell gallon Triton plastic bottles, shipping those across the sea, you’re basically shipping a box full of air, it’s just this really big box, it’s life. So you’re paying much more in shipping than you are in product costs whenever you make it in China. And so it makes it makes a lot of sense to make that product here. Other benefits to it are that we can reduce the amount of inventory we’re carrying, and make more product just in time, we can react to sales, if they’re going well, if they’re going poorly. We’re selling these in Walmart. And if they go out of stock and Walmart’s and we don’t have any in our supply chain, it takes four months to get it back on shelves. So if we can make it here, we can possibly get it to them and maybe three or four weeks. So and then once we’re able to spin that up, it’s just going to open up a lot more opportunities for us within plastics. And our plan is to get into everything steel plastic, we make we sell a lot of kids backpacks. So we are leaning into it, and we have big aspirations for it.
Ben Donovan 27:09
You obviously have made a significant investment in it. But is there a huge difference in the end unit costs, you know those economics yet? You know, what a final produced bottle in the US versus China in terms of a percentage?
Bryan Porter 27:25
That’s a great question, we think that we can make plastic bottles for about half the costs as we can get them from China. Why isn’t mentioned it makes a lot of sense with plastic bottles. Steel is a different story. There are subsidies in China for steel, manufacturing, there’s a lot more of a process with making steel. So that I think that we can do it for at least the same unit cost. But I bet that we can, as we scale of our manufacturing, we should be able to get a better cost on really everything that we make here, or else we probably should not make it here.
Ben Donovan 28:10
You know, for me, I’m thinking Well, the obvious obvious advantages are the lead times Made in USA, potentially increasing the perceived value or that kind of thing. But to think that you could produce it for half the cost similar costs. That’s surprised by that that’s incredible. Is that do you say? Because of the shipping the size of the shipping? Or is it just in the production economics at that size as well?
Bryan Porter 28:35
Yes, it’s shipping is a big part of it with plastics. a gallon is the biggest bottle that we sell. So really, I’m speaking to our gallon size we sell, you know, all the way down to kids Triton bottles, so you’re getting less savings there on shipping. But still, we’re going to be able to make it for a better unit cost. And I will say that there’s an important distinction here. With mass retail the volume per SKU is so great that we can really take advantage of economies of scale with domestic manufacturing with ECOM it’s a lot harder because we spread out our sales across a lot more units. So our strategy is to start first to support our our physical retail business. And then as we scale that we hope to service our digital sales as well.
Ben Donovan 29:27
Yeah, definitely the average Amazon seller is probably not going to be able to manufacture in the US anytime soon. But it’s fascinating to hear you know how you guys are doing it. So we have had I put it out on Twitter, you know that you guys you’re coming on and lots of excitement and I said Is anybody got any questions for Bryan and there were quite a few. So I’d like to try and ask some of those in honor of the the Twitter fam. So yeah, we’re just gonna go through a few of these if that’s cool, that the first one coming in was How did you build a community or a following for a product that doesn’t lend itself to that? They did add, you know, with respects no one is super pumped about water bottles. So how have you got because that your website your branding is, especially your imagery is so good, you know, the, the users of your products, happy faces smiling, you can feel the brand, you know, on your website? And how have you created that?
Bryan Porter 30:26
It’s a great question, I get that I’m probably more excited about bottles than the average. So first and foremost, we want to make products that is so good that you’re compelled to look for us next time you want a water bottle, you’re not searching for water bottle water bottles on Google or an Amazon, you’re searching for Simple Modern. If we can do that, and we can keep our quality consistent, then that’s our main goal. We also don’t want to identify our brand solely with drinkware. We want to be a brand that can support anything that your family needs. If your kids need kid needs it lunchbox, a backpack, a water bottle, if you need any of that, we want to be the brand that you think about similar to Pottery Barn, how they’ve expanded out from just furniture, they sell all sorts of things for the home. So doing that allows us to expand our category category base and create fans of our brands, not just our bottles, but customers who are subscribing to our email, excited to see like our silicone baby bibs that we’re about to launch or, you know, any sort of thing. So we were trying to expand our scope of our brands to not be just one thing. And we’re also one using our website, especially to try and delight our fans. We’re bringing in product monthly. That’s either a new ornamentation of what we already have, or brand new products, to give customers reasons to be looking for our launches, and just be engaged with our brand as a whole. So I don’t want to incite consumerism in people, but we want to serve our customers by offering things that they need and they want.
Ben Donovan 32:18
Yeah, I think it’s a really great point. Because early brand owners ecommerce, sellers, they will think well, I need to create community and this topic of community around your brand is often talked about. But I think as you’ve communicated there, really, you’re not going to build a true community in the sense of everyone’s going to want to talk to each other about your brand. But the community is built around good quality products, and then new variations upon a new product launches, and people will become part of your brand, because of those product factors. Right. And so, which is just a good reminder for all of us, I think that its products, you know, if you’re gonna build a great brand, it all starts with having a great product that meets needs.
Bryan Porter 33:03
Yep, absolutely, totally agree. If a customer if we launch a products like a lunchbox, and it’s not the same quality as our drink, where we’re harming our brand, like we might as well not even sell those lunch boxes just thrown away. We don’t want our customers to experience that. Because they’ve already bought a bottle, they buy an average lunchbox, they could be just done with our brand or, you know, hopefully not this experience. But a bad experience with any product is something that devalues our brand.
Ben Donovan 33:36
Yeah, for sure. Last question for me, then I’ll stick back to the Twitter questions. Otherwise, we’ll never get to. But you mentioned about product quality. And I’m just you know, thinking well, how much can you really differentiate with a water bottle sure that you guys have competitors that try and copy what you do? Have you filed patents? What are you doing to protect the developments that you’re making the product.
Bryan Porter 34:02
So we have IP, intellectual property around all of our lids, we produce all of our products in house. So we have had competitors get right up to the line, in our opinion go over the line. And we’ve reached out to two brands who have done that. We if you don’t hold your brand in high regard and protect it then no one will so you have to have the stuff in place. We’re constantly willing to disrupt ourselves. So if we can make a better products and then something we’re already selling even if it has 50,000 reviews, we need to do it for else someone else will. So an example of that is that we have have sold a certain version of the tumbler pretty well on Amazon we developed a new lid that we think customers are gonna like better. We’re able to ceramic coated so on the inside it’s ceramic and stainless steel, which is a better experience. And we’re in the process of actually swapping out our old version of it for the new version. It’s painful, you lose a ton of reviews. But if you just like, have your your hands closed, and you’re not willing to disrupt yourselves, then eventually you’re not going to be relevant anymore. So we’re constantly launching new things. Competitors are imitating us with ornamentations. We’ve seen we launched a budget two time colors on Amazon two years ago, they did awesome. 20 other brands came came in with the exact same colors ours, our performance dropped off. Because of that, we need to find the new colors that are going to drive our sales in the future, we can’t hold on to the old ones. So it’s a constant process of, of iteration in it and not not devaluing your brand and sales too much. So. Yeah.
Ben Donovan 36:05
Yeah. So many questions I want to ask and we’ll move on to the next Twitter question. How did you decide? Because I’ve seen you or Mike mentioned on Twitter, about your starting budget around 200k? How did you decide to deploy that budget to test the market? You mentioned testing various products? What was the theory?
Bryan Porter 36:28
Yeah, we first use that money, as I mentioned earlier, to test as many cast a wide net test as many different products as possible. Once we select hydration, we then focused all of our capital on hydration. So 200k Sounds like a lot. But whenever you you know, tie it all up the capital, it goes pretty quick. So yeah, even to this day, we’re having to be very strategic with our capital and put it in the highest return places.
Ben Donovan 37:01
Yeah, definitely. Good. And then another one, did you always plan to give dollars to charity? Or did that come over time? And how did you make it work with, you know, high growth, potentially low margins at times? How did that work?
Bryan Porter 37:17
I’m glad this question was asked, it’s actually what we’re the most passionate about our mission statement as a company is that we exist to give generously. So that could be giving of our time of our energy of our financial resources of, you know, our assets. But specifically with money, we, we don’t believe that money is going to make us happy. In the end. We believe that we’re here to be relational, not transactional, we think that the purpose of our lives is to invest in people that we know, our families or friends, and we can use money as a way to actually grow that as our main mission. So, in really generosity does something else, it’s this key for someone who has a lot of money. I think most people, you know, if a lot of money, they they both want to protect their money, and they want more money, even, you know, no matter how much they have, they want more. And we don’t want to be slaves to our money. And we don’t want to be insecure about keeping our money or growing it. So generosity, like opens our hands up and acknowledges that money is not what makes us happy. If you give it to someone else, then it just frees you up. To not be focused on that is the purpose of your life. So we found that to be like very empowering. Money can be very impactful for other people who are experiencing and justices are employees. We want to invest in personally. We can use our resources. We provide lunches every day in our office. We have brought in a thought leader for leadership, Jeremy Kubitschek to talk to the whole company. We want to invest in our people, because ultimately we do that is more important even than our bottom line. I’d be very long winded here, but I think it’s really no, it’s good.
Bryan Porter 39:26
The other important thing about us is we’re not we’re not a we need to sell this company in five years. strategy. We don’t have any plans to sell the company. And so that takes a lot of pressure off like as co founders, we don’t have to worry about scaling up the business to a certain valuation by 2025. We can be focused on just investing money in the best areas investing in our people. So profits are very important. You can’t grow without profit. It’s and, you know, they, we we love the challenges of growing a business. And we’re very achievement focused. But it’s just for different reasons. So that’s kind of a long answer. But yes, we always plan on giving at least 10%. Away, we’ve actually even given some ownership away to donor advised funds. So are the companies actually owned by charity at this point, and has the profits get bigger, we get excited because that 10% can be much bigger. So in terms of how we got to work with low margins is it’s really hard. We sacrifice growth to be able to do it. But it’s worth it. And generosity. We don’t, we’re not generous to make the company grow more. But I will say that, if, if you’re generous with your manufacturer, and you fly over to China, and you throw a big banquet every year, than they are going to respond to that, and they’re going to make excellent product for you. They’re going to perform at a high level. And you know, that that that can be true everywhere. Generosity is is really, it stands out people respond to it. So I think in that way, like the generosity mission has helped our company, even though we’ve lost 10% of our profits, in terms of like our investment base.
Ben Donovan 41:27
Well, the world of the generous gets larger and larger. Hey,
Bryan Porter 41:30
yeah, yeah, for sure. There’s no one good. No one that you’re generous with is going to receive that poorly.
Ben Donovan 41:37
Yeah, absolutely. No, no, for sure. And I think these are incredible business principles that people don’t often talk about. Because it’s, you know, a lot of people are focused on what they can get out of business, rather than what I can contribute to the world. So I think there’s, as you say, you’ve given a long answer, and you said at the start of the answer, it’s an important one. And I think it’s clear to see that it’s, it’s a foundational thing that’s added so much strength to your business. So it’s great to great to hear more about it. If you were to another question from Twitter, if you were to start again, maybe with a lower budget or similar budget, if you were to start in 2022, how would you go about it? Would it be different?
Bryan Porter 42:18
Whew, that’s an excellent question, I, I think our principles would be the same, we’d want to test into the products that that we want to choose. Hydration is a lot more competitive now than it was in 2015. I don’t want to be insensitive to that fact. But I, whenever you’re creating a brand, you do not need to create entirely new products. In fact, if you do that, that might mean that your product is not a good idea, if it doesn’t already exist. But what you can do is you can find the biggest flaw in a product that has a big market. And if you can solve that problem in create a better products, then it is possible to come in and compete in an area where it’s like a red ocean, there’s tons of competition. So yeah, but I don’t want to minimize the challenge of it. We feel with some of our product launches that there’s just a lot of competition now. So I definitely get that.
Ben Donovan 43:21
Yeah, for sure. Nice, good, really, really insightful. I’m obviously conscious of time, because I feel like I could sit here and ask you questions all day. But I did say we were trying to finish up within the hour. So
Bryan Porter 43:33
a few more minutes, at least until my kid bust through the door. I’ve got
Ben Donovan 43:37
Okay, cool. Okay, cool. Because the last I mean, there’s two, sort of maybe brief, who knows, couple of things just to do with licensing and then, you know, co founders because we’ve got some people that would listen, and that’s a big dynamic there. But in terms of the licensing, you guys are doing incredible with that. How does the average ecommerce brand owner get into licensing with Disney, NFL, NBA, etc.
Bryan Porter 44:03
So licensing we have learned is it’s like you’re outside of a castle that has a moat with Puranas in it, and it’s got archers, it’s heavily fortified. It is so hard to get in that castle. But if you get in that castle, then all of a sudden you’re king. Like, no one no one else can get in. You’re totally protected. It’s an amazing moat. So the way that we broke in to licensing was through a local license. The other co founders and I live in Norman, Oklahoma, the University of Oklahoma is our local university and so we were able to get a locally licensed with them. And I think we also got the local license with Oklahoma State. We then were able to pitch to Sam’s Club, a program summer program am for collegiate licensed tumblers. This was super early on in our business, we actually had never made this product before because it would have been illegal because we weren’t licensed for all the universities. So we pitched this to Sam’s Club. We’re still amazed that they said yes to it. They in, I think it was in 2016. Later in the year 2016. Hydration was just on fire as a category they saw fit for it. The problem was we weren’t licensed with NCAA. But we got Sam’s Club to say yes to POS. We then took those POS from Sam’s Club to the NCAA and said, Hey, you want some some licensing royalties, we got him. So see, we were able to basically leverage two organizations like that we were not partnered with a at that point in time, together to get on board with both sides. So getting in the door with collegiate was was important. We started selling that product on Amazon. There was not there was a hole for vacuum insulated in collegiate tumblers on Amazon turns out that those are amazing gifts, we sell about 50% of our fan shop products in December. And we sell a lot in December, the rest of the year is a little bit tough. But we’re able to then show the sales data on Amazon to other licensing bodies, in say, really, I guess other licensing bodies, they want to know how you can add incremental sales without harming their other relationships. If you’re just going to take, if you’re going to dilute another one of their brands, then you they’re not going to license you. So we were able to show them that we can add incremental sales selling their product on Amazon. No one else was doing it. We were doing it the best. So that’s really how we got on board with the NFL. We have an NBA NHL. And also there’s other connections if had been helpful, too. But really, you know, you have to add value to them. Or else they will not say yes, it was Disney. That’s the biggest license, they’re bigger, bigger than all the fanshop licenses combined. It really was as the similar pitch to them, that we can grow your business on Amazon. We’re the number one seller and kids bottles. You know, predating Disney, putting your your branding on, it is only going to make it better. And now Disney is doing more than half of our kids. Bottle sales.
Ben Donovan 47:45
Wow. That’s incredible.
Bryan Porter 47:48
domino effects. Like if you’re playing a long game, you just got to think about how to get in the door with one. And then if you can do both, that one opens doors for the others. Yeah,
Ben Donovan 47:58
great insight, though, in terms of leverage, that’s a great strategy to set it up on both sides to prove that can be done. It’s yeah. Good thinking about all of it. Good. Okay. So last sort of one, then just in terms of co founder roles, because, you know, coming into the company, there would have been a lot of dynamics going on there different people have different ideas, how have you managed to over the years maintain a really good working relationship as co founders in the business?
Bryan Porter 48:27
It’s an excellent question. We were lucky, we were able to co found a business organically, with relationships that had a decade plus of history behind it. And so we knew what we were getting with each other. As I mentioned earlier, we respect and admire each other. And we have the same vision for our lives in terms of what is what is our purpose for our lives. So we we have a wider ownership group outside of the co founders, and those are also individuals with rich relational history, cultural alignments. Everyone knows that we’re not we’re not trying to sell this thing. We’re not even necessarily trying to cashflow it, we’re just trying to grow it and use it as an instrument for impact. So that in itself takes pressure off. Like we’re not feeling the pressure of an exit date. Were we have several values like when, for example is that we view mistakes is tuition. Everyone makes mistakes, we know it mistakes are good, because you can learn from them. Much like the small fortune I gave the University of Oklahoma for diploma. If I make a mistake, they cost us $20,000 Then I can either learn from that and grow. Or, you know, we can just not take advantage of that. So we use mistakes as tuition. And that’s a really empowering freeing mindset to have, it helps to reduce tension in the organization. So, yeah, like I said, if you’re somebody who’s looking for a co founder, I think the takeaway that I have from my experience is that alignment on core values is essential. If you’re not aligned in what your purpose is, even though it’s not the same purpose that we have, you need to have that with your co founders. And you need to, you need to co found with somebody that you want to be around and spend your days around, because you’re then handcuffed to that person. So yeah, I, I think I’m spoiled the because of my experience. But I do think it’s possible for you to seek a co founder and find somebody who’s going to be an encouragement in your life and not a drain on your life.
Ben Donovan 51:13
The final thing I was going to ask you is, what’s the plan in the future, but it sounds like more of the same.
Bryan Porter 51:19
It’s more of the same. Where is that mission where we’re at an ambitious group, or we’re stupid for taking on as much as we’re taking along with manufacturing and scaling up our retail business. But the, the plans are to grow internationally, as we mentioned. I, I would love to and maybe you could help with as Ben grow our European distribution with Amazon. Manufacturing manufacturing’s, a big one, we want to grow our licensing base, their licensing partners that that we want to acquire, like Warner Brothers, Universal. There’s a few universities out there that we still need to get, like you can’t sell your Notre Dame licensed product unless you make it domestically. So we think we’ll get that one eventually. But yeah, we’re at the point where we added Walmart, we’re scaling up with them this year, next year, outside of international growth. There’s not many big players left, we’re not in Costco yet. And we don’t necessarily need to be everywhere. There are brands like Yeti and Nike who are actually retreating to their own website, because they have more leverage there. And they have a customer base that’s known. So I think on top of the things I mentioned, becoming better brand marketers is a thing that we have not quite figured out yet. In that we can actually layer that on as we start to produce cash to turn Simple Modern into a brand that’s known in some homes to be not being known in every home and being just globally known brand. So ironically, we haven’t been able to really use that lever to this point, but I think by the time we’ve we’ve really kind of won the distribution war we can pile that on is like further fuel to entrench the brand.
Ben Donovan 53:24
I just think it’s funny, you know, millions of units and sales a year and you’re saying you don’t do brand marketing very well. I love I love that humility that we’re all we’re all privileged to be sitting here learning from you guys and genuinely thank you so much for a the you know, the Twitter stuff, it’s really really insightful. Be coming on to the show. Really appreciate you taking the time out. Where is the best place for people to continue to follow the journey simple, modern and yourself.
Bryan Porter 53:54
I appreciate you asking. My Twitter handle is Jay Bryan Porter, Bryan with a Y. And in really our goal with Twitter is to be exporters of what we learn what our culture is, we want to expand our reach with those things and be influential because we think that the way that we’re doing business is really the way that business can be purposeful and impactful for the world. So we want to say that I wanted to ask you a question before we hop off then I’m the only person who had the market cornered on being able to give wisdom. This is your your 31st podcast. I want to know what your biggest takeaway is what your biggest learning is after doing 31 podcasts.
Ben Donovan 54:45
Yeah, no, I appreciate the question. And you’re the first person to ask me a question. So it’s, again, I think shows why you’re building such a great business because that’s just the nature of who you are. But no, I think the thing for me is that nobody says So far that I’ve interviewed thinks they know it all, I think that a successful entrepreneur realizes how little in the grand scheme of things they truly do know. And that the journey of entrepreneurship is a daily journey of learning. And I think, again, without sort of meaning to, you know, suck up to your too much, it’s like you’ve sat here and exemplified that and, you know, you’re doing the most sales of anybody I’ve interviewed. And you know, you’re asking me questions, you’re talking about continuing the learning journey, you know, you’re talking more about what you don’t know than you do know. And I think that is the key isn’t it? Doesn’t matter how big you get. There’s always thinks to learn. There’s always a bigger impact you can have. And yeah, I think that’s, that’s a huge key.
Bryan Porter 55:41
I love it. Thank you for sharing that. I’m sure that the first podcast was daunting. And by 30 You You probably learned a lot. Definitely I appreciate you having me on. It was an honor to be on with you.
Ben Donovan 55:56
Thank you. Yeah, appreciate you coming on. And definitely will leave the link to your Twitter in the show notes in the description as well. So people can check that out. Bryan, it has been an honor and a privilege Thank you very much.
Bryan Porter 56:08
Ben Donovan 56:09
Well what an episode that was just incredible story incredible people incredible business so make sure that you are following them on Twitter both him Bryan on Twitter we’ll leave the link to down in the description in the show notes and also for his partner Mike, and they’re tweeting up just insane value all the time, so make sure you do check it out. If you’ve liked this episode, make sure you do subscribe because we do have great guests on every single week. And if you do get a chance please do leave a review because it really does help us be seen get more great guests on ultimately helped you on your journey of building a breakthrough ecommerce brand. Alright, we will see you in the next episode. real soon.