#156 - David Segal Talks Building a 9-Figure Tea Business, Decommoditizing Boring Products & The Future of Retail

Yeah. I feel like I can rule the world, I know I can be what I want to Mm. I put my all in it like my day song On the roadless travel, never looking back

Alright, so we got uh special guest. Got referred in through Harley from uh from Shopify, David Seagull. Seagull or Seagall? How do you say? Seagull, but Seagull seems a lot cooler, so Yeah, I was gonna say. Uh related to one and only. Actually, the guy who started the company with you, is that a relative of yours? He also has the same last name. Yeah, he's a a distant cousin of mine. He's fifty years my senior. That's the great like starting pitch. It's like me and my ninety year old cousin are gonna start a tea company. Yeah, totally. So uh so can people like I don't know, explain what is David's tease uh so for somebody who's never heard of it before, has never been inside one.

Sure, so uh I mean you think about T so we started it in two thousand seven, and if you go back to that time. You either bought it in a grocery store where it was a commodity, right? You picked what you wanted based on the picture on the box and the price point. And you had the usual suspects, Earl Grey, Chamomile, Mint. And then you had ten brands of Ral Grey and and ten brands of Mint, et cetera. Or you somehow found a T shop.

That was either very Asian or very British. And quiet and you felt like you had to whisper. And even just to walk in the store, you felt like you had to know something about tea. We had the idea because nobody's really doing tea in a fun way on the main streets of the of the country. And T was had this stodgy vibe to it, and really there was an opportunity to make it a lot younger. And when you think about tea, it's it's actually a specific plant. It's the Camellia Cinensis plant, but how you process it makes it different. But in North America, we call any herb, spice, fruit that you put in hot or cold water that's not coffee, we call it tea. Uh yeah. So I had the idea, I turned to my now ninety year old cousin.

And said we all So you're not joking. Yeah. I thought the ninety year old thing with a with a you're like hyperbole. Yeah. No, I mean he's ninety no, he wasn't ninety then, right? He was in his seventies then.

Uh I was a young entrepreneur, I had been a hustler. You know, most of my life. Uh, I'd had different businesses that didn't work, some that did to some degree, and then came across this idea. I was actually working for him at the time. uh to help him make investments in small companies. Had this idea for tea. Turn um we looked at a few to invest in realized the market was pretty wide open.

He said, You do it, uh and I'll back you and I was like, Great. Uh we got to work and built a brand, grew it, and anyway at its height it was billion dollar market cap on the Nasdaq, two hundred million sales. I sold my stake in 2016. I moved on and I've been doing other things. I started a a restaurant brand and added two other restaurant brands and turned it into a virtual kitchen. And I'm looking to get back into T, to be honest with you. I think there's still a huge opportunity in T, but yeah. So your your cousin who you started, he had done something cool before this, right? Like some like that. No, clothing business. We had a company called The Chateau, which uh was in one time very big in Canada and even had uh a go at the US market as well.

He started in nineteen fifty nine. He was selling in the sixties to like John Lennon and like there were some pretty interesting characters. And what he did was he brought the Carnaby Street look. In the sixties to Montreal. And it was really successful and and he stepped back from it. The mid two thousands.

was looking to make these investments and yeah, I mean it was a great combination of You know, at the time I was twenty six years old and and full of piss and vinegar and I still am. I've never heard that phrase. What does that phrase mean just like I guess piss and vinegar is like an explosive combination. I don't know. It's a good question. I never actually thought about what it meant. It's just one of these things you hear and you're like, All right. Did this make you incredibly? Yeah, I did well. I I scored. Yeah. Oh great. So what I was gonna ask you and I think you just answered it.

Do you regret taking the company public? Because taking the company public seems pretty Besides like all right, so you generated You created a lot of wealth for yourself. That's Awesome. Besides that, which is like a huge besides, but besides that, do you regret it? I don't regret it, but I wouldn't do it again. I think I was in a very difficult situation at the time. We had done a deal.

So my first million actually came. when we did a deal with the private equity group. And the business got complicated. We did a deal with a group out of Boston, Highland Capital, this guy named Tom Stanberg, who's the founder of Staples, actually. And my original partner, my cousin, and Tom it was a difficult combination.

My original partner wanted to bring in various family members. I wanted to run a meritocracy professional outfit and there's a bit too much It just wasn't a good situation. And when you're management team and your board are fighting with each other, you're not focused on creating value for your customers and I just want to get out of there. There are too many bullets flying. You could see there wasn't a lot of focus on the actual business. And so for me it was great. It I was the third largest partner, third largest shareholder, but I didn't really have the power.

The sort of Peace was made in that they would go public. for the private equity group to be able to exit. And the CEO at the time would get fired and and the family member that my cousin, his daughter that he wanted back in the business would come back in. And then I was able to leave at that time as well and say, You know what? This is a bad combination and I'm out of here. And so you uh'cause I always wonder this, when you take a company public

You know, there's a lock up period. There's like a technical lock up period. I don't know how it works on uh actually you're a NASDAQ, so there's like what is it, six months or something like that you can't sell? Six months, although on this IPO we were I mean, we were making like thirty million dollars of eBay. We didn't really need the money. And so on the IPO, to make the IPO big enough, we were selling Shares like I myself in Highland Capital sold shares. My original partner didn't want to sell any. And I was like, Yeah, I'll sell. I mean it was a great price. I ended up selling it at average price of fourteen bucks a share and you know the stock today trades at dead four.

How do you decide how much you're gonna sell, right? And what's your psychology around that? Like You're like, all right, I'm gonna get hundred percent, sixty percent, and then there's the optics of it. So like how do you do you think about that part? I think in this situation, I love tea and I think there's a huge opportunity in tea and I want to get back into tea. When management is fighting with each other. You wanna get out. I mean at the end of the day you want to get out. Like the the future of the business does not look bright in in those types of situations. So Under normal circumstances I wouldn't have sold at all. I mean, I think there's an opportunity to just continue to grow and and you look at T, I mean

It's one of the best hacks. Productivity hacks that nobody knows about in North America. It doesn't give you the jitters like Coffee does. It doesn't give you the big spike and the crash. It's a better high, man. It just is and You know, in North in Canada, I mean it's less than two percent of Starbucks' sales. It's we don't drink it. We have these these We're missing out, frankly.

Ah there's so many amazing flavors to it, so I I still think there's a massive opportunity. It's just It wasn't gonna happen with David's T. They took their life off the ball and and I didn't wanna Be part of a team that wasn't aligned. So

What do you I guess what are you scheming on now? Well I got this restaurant concept. We have three stores in in Ottawa, which is where I live, and three in Toronto. We're gonna open more. We added two brands to it during the pandemic, so We had this class called Mad Radish. It's it's bowls and salads with big international flavors.

We added a burrito brand, which is a healthier take on a burrito, and then we added a Neapolitan pizza company. Uh so Luisa's burritos and bowls and Revival Pizza. And we're operating about a one space with one app. So we're trying to kind of combine the best elements of Ghost kitchen with the best elements of a restaurant, so we're still building up restaurants. with some setting But we're dedicating more space to kitchen space.

And we're taking perhaps slightly less prominent real estate and being able to service one customer with different types of cuisine so You can if you have three people, one of you can get an amazing burrito, another one can get a salad, another one can get a pizza all in one order. So I'm still doing that and I have an incredible operator there and an amazing marketing lead and just a great team all around. And then I'm also actually working with Harley on a T basis. I think there's a massive opportunity to make tea cool. You know, David C Mate fun.

But people don't understand how incredible. this plant is and how many amazing ingredients there are. And so we're gonna do it without any flavoring. So all tea companies use lab flavoring. So they call it either natural or artificial flavoring. And they just basically develop A liquid flavoring that they splash on and it coats the tea or the ingredients. But you don't really need to do that. If you get really high quality

high oil content, ginger or cinnamon from the best places in the world. Like you can make these amazing blends. Not to mention all these varietals of tea. That people just don't understand. I mean What's the model this time? So last time it was brick and mortar stores, right? You opened up hundred, two hundred something locations and like Tivana, you would go in and you'd be able to buy teas there. And I don't know how well that worked. Sivana got acquired by Starbucks. How much did they get bought for? Six hundred million.

Six hundred million and uh And I think they shut down their stores and now it's just sold out of Starbucks or something like that. Is that right? Yeah, Starbucks uh didn't do great on that acquisition. Starbucks does a history of of so so acquisitions. And why why is that?'Cause that seems like you like what you're saying is Dude, tea is massively, you know, underrated in compared to like America's heavy heavy coffee. T gives you, you know, all of the spunk with none of the funk. This is the best. It's huge internationally. And then with Starbucks distribution, you would think, look, if T was gonna pick up in a bigger way, like

Tivana getting plugged into the Starbucks engine sounds Like a good idea. Why is that a so why was it so so as an outcome? I don't think the tea was that good. And I think that matters. I think that there's a market for people. Look, just it's like wine. There's three types of customers here, if I was to summarize it.

There's the customer that just wants to get drunk, wants the high, right, and doesn't care. They're they're picking it because it's cheap. And'cause they like the picture on the bottom. Then there's the customer on the other end of the spectrum that is the connoisseur. They want to become a tea hobbyist. They want to be able to tell you about the terroir. And then there's everybody else, which frankly

Wants the really good wine or tea in this case, they want quality, they can tell when they taste it, they're like, wow, that's good. But they don't need a PhD in T, and I think that There's an opportunity to simplify this. There's an opportunity to curate it better. You don't need a hundred different blends. Like we're gonna have twenty.

And these are the 20, like, you know, look, I know my stuff. I've been doing this for a while. These are the 20 you want to drink. We've tasted thousands for you. You don't need to think about that. And I just think there's a way to talk about it in a language that people can understand. You know, tea is not just when you're sick or for hippies, or you know, because you romanticize travel or because you're an old granny who eats cucumber sandwiches. I mean It's a better drug a than coffee. I mean You know, you think about one of the big themes in the world today is like centralized versus decentralized. Like coffee is centralized, it's centralized our culture in many ways, like.

No matter what you do with coffee, it still tastes like coffee. Whereas tea, you can get all these different flavors. There's no dominant brand in tea today. And it's in many ways the decentralized product. And I just think there's an opportunity in direct to consumer, you know, when I do some pop up shops, maybe. Would I do some really cool restaurant applications like an espresso type store model, maybe down the road? But we're gonna start as a direct to consumer business and and See if we can, you know, go after coffee drinkers and say, Listen, you're missing out. Try this out. Like coffee is like the PC and T is like the Mac, and you should try this. So at your

It looks like uh the biggest year in revenue you guys did was close to three hundred million, is that right? Yeah. Yeah, we were getting up there. Two eighty five. two eighty four and prior to this, you had a software company, right?

Yeah. Didn't work. Didn't work. I think it's a cool little funky concept. From what I read, you basically went to department stores and you said, I'll I have software that will give you some data or analytics around. What people are taking into the fitting room versus buying, right? They're like they're try they're getting to the try it out step, but they're not buying or they are buying. It's like it's like abandoned carp.

Software in real life. Real life. Yeah. Abandoned fitting room. Totally. Yeah, I mean good idea to be honest with you. What happened? There's a big difference between a good idea and a good business. You know, I kept hearing the word interesting. It's it's like it's very academic. It's like you know Yeah, sure. When you buy clothing, you do it in two steps. You evaluate the look on the rack, then you evaluate the fit on your body. And then when the buyers go and analyze whether the item you know, they test stuff and then order larger quantities and when they go and analyze that, all they know is whether it's sold or not. They have very little insight as to why. And so the idea was to give them more insight into the why and but

It was ahead of its time in the sense that it was complicated. Like these are companies, you know, this is two thousand five, right? Like they barely had functioning. Point of sale system. So You go in and you're trying to give them information, they gotta do something with it. I kept getting them saying to me like interesting, interesting. And I thought I was on to something, but you know, the sales cycle keeps going and all of a sudden Sue from Marketing wants to talk to Bob from IT, who wants to talk to Michael from purchasing, and like we got nowhere. We got it into Macy's though, like You know, in those days I was writing handwritten letter to every CEO and every clothing company you can think of, like

you know getting Les Wexner, the founder of of Limited Brands and Victoria's Secret to respond and stuff like that. But I get a lot of meetings and we even got it piloted at Macy's on thirty fourth and seventh, but I realized quickly that Long complex sale cycle. A nice to have product, not a need to have product. And I moved on.

But my question is this. So you you're friends with Harley, you probably uh have invested in and have great insight into a lot of different test style businesses like software and I just sold my company to a software company and I'm getting exposed to it for the first time. your company, its revenue is definitely a little bit bumpier as opposed like versus a really good software company. It's like even if it might be grow slow, but it's kind of stable. But you're getting back into a I don't know, what's the word? Consumer Right, right. You you you're doing e commerce instead of software. What Why why you doing why you doing e commerce when software exists?

I'm a merchant, man. Like I love the product. I like to put together great collections. I like to sell pro I like selling product. I And I'm not criticizing you, by the way. I'm not shitting on you. You're way more successful than I am and you're badass. I'm just saying like A lot of my friends in this industry, they complain constantly about supply chain issues and about this and about that. And software has its own issues as well. But if you could do anything you want. Do I just want insight into why you chose this. Or why you're doing it again. I mean the main reason why I'm doing it I'm to your point, like like I I don't need to do it. I mean I could go play shuffleboard in Florida, but I love

business and I love entrepreneurship. I love creating Something from nothing. And I have a passion for tea. Like I look, I'm drinking an amazing green tea right now, right before this podcast. You know. So I love the product first and foremost. It's also a great business. I mean the margins are good. You're selling a product that does that is a drug effectively. The biggest drug dealer in the world is actually Howard Schultz.

It's a great business. There's no size, no color like there is on shoes or clothing. So the amount of items you're managing is much lower. You know, you can operate out of small spaces if you do decide to go into retail, although we are gonna do this direct to consumer. I think there's space in the market. I think that this is a product that is un not well understood by the North American customer, and they're really missing out on something incredible here. I'm excited to bring it to people. I think it's just a lot of fun. Like Software businesses are great, but uh it's not what I love. I'm I love it as a customer, but I don't want to go and create them and I I wanna sell tea, man. I like tea. You love tea like Sam loves trucks.

There you go. I talk about truck the trucking business all the time, but I wanna ask you another question as well. So Uh, unless we post this video, you can't see but you're Audio and visual setup is Like really, really good. Is it D S L R?

Yeah. Yeah, exactly. Yeah. Like an A six or what's it called? Like an A seven or M something or other. It looks great. I tweeted out the other day, I go, someone I'm setting my stuff myself up like this.

I couldn't do it. Did you do it on your own? No, God no. So I tweeted out somebody come and let me pay you money and do I can't find anyone. Like there's no great turnkey solution just to come and do this for me. It's pretty amazing. There's a business right there, right? If you sold amazing suits In the eighties or nineties.

You got all these business people buying your product. Nobody's buying suits right now, but I tell you there's a lot of business people that wanna buy Killer video and audio setups. They need ads. The ads will look great because it'll be someone in a room like yours with the camera quality of yours and all that. And it'll be like you know, it's the men's warehouse guy saying you're gonna like the way you look. Yeah, right. That's what I want. You know, you it should be the same tagline, but for a zoom call, basically. So to the end, you get you can get like, you know, the startup package, the pro like I mean you'll have the five thousand dollar package, the three thousand dollar package, the ten thousand I think that's an incredible business. Like the aesthetics of the background. No, the background's me.

That's his house, dude. It's my house. I'm in my office. Like when I've been thinking about this, all right, I'm like, all right, we need the'cause right now my walls are white and that's white is not good when you're doing this. You actually want but I'm having to hire two different people. Like a set designer style person, and then like a technologist. And I've been thinking about this a lot. Uh I've just I'm like, Man, I would pay like two grand Just all to have this done for me.

That should be part of the package, right? So have you guys seen we talked about this a long time ago. Actually, when we very first started the podcast, I go, Hey, I saw this ad for this company, and I don't know, I've never heard anyone talk about it, but I think it's a dope idea. And uh it turned out there was like uh super legit entrepreneur Roger Dickey behind it. He started Jigster. And uh some other things. And so It's called made renovation.

And what they do is they it was that all they do is bathroom renovations direct to consumer through Facebook ads, basically. So what they do is the ad is just a before and after of a bathroom or just the after just a sick looking bathroom. And they know that like In the home renovation space, which is this probably a huge multi billion trillion may make up your number space. Christians and bathrooms are like, I don't know, seventy five percent of it. And uh so they just started with bathrooms and they basically have three turnkey bathroom styles. It's like you can have this kind of cool Victorian, this cool modern, and this like kind of simple classic. And uh they have three bathrooms. So all their parts and supplies, it's already like there's no like planning step. You just say, I want that one, that one, or that one.

And then they have all these installers who just know how to install this one fucking bathroom type. And they're like, Cool, we're dispatching the guy. He's gonna go give you this bathroom. Brilliant. And it's a genius idea. I'm sure I don't know what the price is, but it's yeah, in the thousands of dollars per customer be ten thousand, fifteen thousand. Because the worst part is the contractor, right? You don't want to find the contractor, deal with the contractor, like it's uh it's a whole shit show. And then the contractors today don't do any marketing, right? So you have you're going up against a player who's got both hands tied behind their back because they're literally not even out there selling. So I love taking, you know, world class internet marketing. pairing it with a high ticket, you know, high value thing that everybody, you know, sort of considers at some point in their homeownership, and then going after. So I love this. And I think you could do that idea for what we're talking about in the home office space. I think you could do made renovation for home office now because That's become

Top of mind for, you know, I don't know how many tens of millions of people. And I think you could do the same playbook for for that. Totally. And and it's even more there's even more value add because you're dealing with with audio video setup and it's not just Brick and mortar, right? Like exactly. Yeah. It's more of a technical thing and less of a like you know plumbing issue. You know what I'm doing is I stole this from a friend, my friend Noah and Neville did it. They found a YouTuber in Austin. And

They just said, Hey, can I pay you like fifty bucks an hour and you spend eight hours and just make this really cool and just Beforehand. buy everything you need, ship it to my house, and then just set it up and make the lighting and everything neat. It's pretty sick and I've been trying to find people who can do that for me. And I don't know if someone's taking me for a ride. I don't know, you know, like I don't know who to trust. It's kind of an interesting idea. You know what I also think? Just like you the YouTuber thing. So let's say you didn't want to start a business in the crazy way, but you want to be a YouTuber.

And you see guys like Mr. Beast build their channel on these like kind of stunts and like giveaways and surprises and you know just random acts of kindness and money thrown at people. So you could do the Pimp My Ride playbook. as a YouTube channel. You could be exhibit you could go knock on someone's door and basically be like, dude It's your room. Your room, we're tricking out. And you trick out their room to like like I should be, you know, my chair should be an aquarium, and there's fish floating underneath my butt while I sit here. Like that's what the crazy level. And then I think people would watch these videos and you could build a

Huge, you know. Tens of millions of subscriber channel. And have all of the like kind of renovations paid for by, you know, maybe peripheral companies or whoever, like some sponsors, just like Mr. Beast did, where Paid him fifty grand per video so that he would go give fifty thousand dollars away. And he's like, Cool, you're paying for my growth. That's brilliant. Even on the contractor side, it's inter I mean, let's see you talk about contractors, like there is no way uh there's no Uber reviews for contractors.

Right. Like how do you find contractors nowadays? You either know it's all referral based, right? It's all word of mouth. You look around, there's been a lot of businesses that have been word about businesses that have platforms have been created around to be able to facilitate finding a good one. Have you guys heard of Mazi? No, what's it? Okay. It's M O D S Y mod Z. And what it does is let me pull it up so I can explain exactly. But I've used I've spent

Two or three thousand dollars with them because I've done it for all my houses and apartments. So basically the interesting part is the technology. And so You take pictures of your house. Every time I've done it, my home was empty. Yeah, but I've done it a couple of times with furniture in there already. But you take pictures of it and like a video. And they patch it together. to make like a three D image of what your room looks like.

And then you go through a quiz and tell them what furniture interests you and like what styles interest you. And then they have people who are mostly like design students. So like college people who are Good enough. But you know, don't make a lot of money. And they have like a massive group of them on staff, and they send you like eight or ten different designs of what your room could look like.

And then you say, I like this, I like this, I like this, I don't like this, I don't like this, and then they fix it. And then they give you a final one and then they have a buy now button where you can just buy all the products that they've listed. And it's a vir a virtual designer. It's thick, yeah, it's pretty cool. It's like five hundred dollars a room. I've probably about right now.

I've got eight rooms maybe done over the course of the last four or five years. Uh if I'm Crate and Barrel, I'm buying these guys now where they're small. Right. It's really fascinating. I I've really enjoy seeing this business kind of take off. It's super interesting. But they don't do like audio visual stuff. I mean, but in many ways this is a feature, not a business, right? Like I'm surprised they haven't already been scooped up. Yeah, it's uh you pay five hundred dollars a room and then I think they make a lot of money off the affiliate fees, which is a pretty stupid business model because I don't buy any of the stuff they tell me to buy. I just go out and buy stuff that looks exactly like it. You know what I mean? Like because a lot of the stuff they pimp out is like

brand I haven't heard of and they list a leather couch. I'm like I've never heard of this brand. I'm gonna go to restoration hardware and buy one just that looks exactly like it. There's an idea that's uh along the same lines I'll talk about it real quick. If you go to intro.co, the guy behind this is we're not super close friends, but he's a good guy. I've met him before he had sold one company to Intuit so he sold like a kind of a bookkeeping software to Intuit. Made good money, moved to LA, blah, blah, blah. And now we start this thing called intro. What intro is is like uh You know, like these businesses like Clarity F M or whatever where it's like Clarity started in the tech space and they were like

Hey, you can pay forty five dollars and you could talk to a head of growth at Airbnb to talk about growth. And it's like dude, this is like this nerds feeding nerds. Like I don't know, it was just not like the coolest way to go about this idea of connecting people who want expertise with experts. And I'm so at the premium end. You guys know about like GLG? Have you guys heard of GLG? Yeah. No. You're gonna get you're gonna like this. It's crazy. It's an insane business. Basically, GLG is an expert network that hedge funds and big financial players use. Yeah. So let's say I wanna decide if I'm gonna buy Tesla, right? What I'll do is I'll go to GLG and I'll say I want to talk to every like world class battery expert or s or AI expert to talk about is Tesla is what they're talking about for batteries and self-driving cars. Is this like a reality? How close are they? Are they better than what Waymo is doing and whatever? So you pay like

Thousands of dollars. I'm a I'm a GLG expert, Sean. So like I put on my profile. I know a a lot about email marketing. And I'll have like I've had Morgan Stanley call me and This I they they can't tell you what they're doing. I have a feeling they were talk they uh it was about Sengrid's IPO. Yeah, and they wanted to say, like, do you use Sengrid? And uh I was like, uh it's okay, it's kinda complicated. I prefer mail chip. You know, and and and I charge

I put like what I thought was a wild number, like two thousand dollars an hour and I started getting bids. So I went on clarity. The issue I had with it, it's not curated. Like how do you really know Who's a pack and who's for real? Right. So that's what so GLG does that a little bit better where they're like premium. So uh you know, like because they're charging thousands of dollars, they can afford to vet people and like use the reviews to like curate the marketplace a little bit. Although to be fair, I don't know how much they they really do it, but in theory, because the ticket price is so high, they can afford those serv additional services. And so hedge fund guys need it because they're trying to make

Big decisions. And then on the low end, nobody's really been able to do it. Uh the guy who started mint.com, he tried to create something called Fountain, which was like You need a repair or you want to redo your lawn or your your bathroom, like call a expert contractor. And it didn't really work. So there's been tried a bunch, but I think this approach is the intro is doing is somewhat interesting because they chose a better market, I think, and they went for like they got the stylist of like Justin Bieber and Kim Kardashian stylist and the person who did the Kardashians like home decor renovation, right? Or interior decoration or whatever you call it. And so you could pay, you know, fifty bucks and you could do a video like a FaceTime call with Justin Bieber stylist and you can ask them about style stuff. Or so and so as trainer for your workout routine or exactly. I could get the rocks to Right. Exactly. The bragging rights of I talk to the rocks trainer for thirty minutes. Now I I too.

Well look like So I don't think this is gonna work necessarily. I think it's a really hard business. But people keep trying this and eventually somebody is gonna crack it. Somebody's gonna figure out how to get the dynamics right, pick the right vertical. Like one interesting thing about this business is The astrology vertical.

started taking off because people were just like There's all these like celebrity kind of like astrologers on Instagram. And so they're like, they would just promote like, hey, you can book me and I'll do a reading for you. And people are like, Oh yeah, I want, you know, you to do a reading uh you know an astrology reading for me. And they're just making tons of money, thousands and thousands of dollars a month. Because that vertical works. But you would think it would be the more Mainstream large verticals, like working out, clothing, uh, eating, diet, right? It ends up being astrology go finger.

No, I I I buy that. David, do they have Miss Clio in Canada? No. Okay, so there's this woman I don't know if it went to the two thousands, but it was in the nineties and she was Jamaican I don't even know if she actually was that, but she was

this character that would play on infomercials and she had a Jamaican sounding accent. Okay, like Hey, darling, how are you? And she's like, Let me read your poem like or one eight hundred. It was like tarot cards or psychic reading. They had a phone bank. in a warehouse full of these types of people. Who knows what their credentials were. I mean nothing, right? It's like agreeing for real. But they did the Night of Cups.

In only a short amount of time, this company did a billion dollars in sales. Wow. So I think that the psychic thing Yeah, man, people want predictability. But I mean, do you really want to be doing that? You're selling snake oil, right? No. But it's interesting.

Yeah, I think in in some ways it gives people this weird peace of mind. Uh it's like religion, right? Like if you feel like you know something about your fate is being told to you and you get either comfort that Yeah, everything's gonna be all right. Or you know that It is what it is and it's and I don't have to like stress about it anymore. I don't know, there's something that's deeply like there's something that just is deep in this that works for people. I obviously I agree with you, you know, the person who's on the other end

who's just got a call center of, you know, Jamaicans who are fake Miss Clio is like, you know, there's a question of do you want to be that person? But there's no doubt that there's demand for this kind of thing, which is Which is wild. You could just reboot Miss Clio today on Facebook and uh Facebook is your near infomercial and probably do extremely well. What um businesses are interesting you right now, David, besides um the things that you're directing. So I mean I think it's never been easier to uncommoditize niche products. So I give you I'll give you an example. I've I was It was in Turks and Caicos with with Harley actually and we were Lighting fires on the beach, like we would get someone to set this up like a bonfire, right?

And they have this special wood in Turks that For whatever reason, burns lights up faster and burns longer than anything I've ever seen. And I'm Canadian, we light a lot of fires, it's freaking cold up here. So we start having this idea and we start talking about s the experience around starting fires, right? And when you start a fire, I don't know if you guys Start a lot of fires, but you you

Yeah, okay, so you tear up newspaper You put it in the fireplace, or you buy these little pucks that you buy on the back out. It's like the back shelf of Walmart or the back shelf of Home Depot. And you gotta light them and you're in like usually there's fire ash already there from the last fire you lit. The whole thing kinda sucks. You're down there, you're blowing on the fire. Ashes going everywhere, it's messy, it's not that great. So our idea was to create a a fire starter, not one of those logs that are full of wax and feel very chemical, like the Dura logs or whatever, but more something that it helps you get a bed of coals and it also ideally would have some scent that it gives off. So kind of merging the idea of candle with fire starter. And then of course you could go further, right? It you leads to this idea, well, what about the like I'm looking here in this room actually the fireplace on my left here. What about like the shovel that you get and the little broom thing and the fire poker, right? Like

There's a lot of products on the back shelves of Walmart or Home Depot. That have been bought half hazardly by some mid level buyer at the company at a trade show. That are complete commodities that you could uncommoditize, create a put a little bit more thought into, create a better experience around, and have these niche million dollar businesses. And I I think I think there's a lot of opportunity there. That's the first place I would start is I would literally go down to one of these big box stores

And walk the aisles and be like, what product do these guys clearly not care about, but feel they have to have? There's where I would go direct consumer and create something a little bit Better. So Duraflame, I'm looking it up now. crazy fascinating. I believe it was sold the Clorox.

But It sells something like five or six hundred million dollars a year in these logs. There's been no innovation there since I was a kid. It's the exact same log, but it was five years old. They were lighting dirlogs. That's super fast and fire. I do buy a lot of that stuff. But I only buy it in store. I don't ever own it, order it online, but I think I would. I think I'd go. I mean everything fucking online, right? Yeah, exactly. I mean once upon a time you bought everything in store.

It's just a little bit more of an imp like I need it right now. But I would do it as well. This is it's also giftable, right? It's a nice thing, like you want to get cool. A great example of your thesis there about differentiating a commodity product. The guy who spoke at HustleCon, Eric Bryan, is that his name, Sam? Yeah. Um, he's basically built his career off this. So his first thing was method soap. So he's like, Oh, okay. You know, he's like, you can just walk he goes, I walk down the aisle in a grocery store. Uh he goes anywhere I see uh A sea of sameness, like an ocean of the same thing. And he he push out a picture of the soap aisle and it's like Fifty five green bottles.

Of liquid that are all shaped the same and all look exactly the same. He's like cool. I'm gonna make a new bottle shape. It's gonna be a different color. I'm gonna market this in a kind of risque way. You know, if you turn the back of these bottles, they all have these chemicals you can't pronounce. So I'm gonna make it where it's chemical free cleaners. And method became like a big hit. And now he's doing the same thing with Welly. Which is band aids. Go down an aisle in a Well he already did it with vitamins for bolly and then he did band aids. So welly's the probably the best example of the thing you're talking about. Band aids are the most like

Commodity, who cares? Literally the thing is meant To blend into your skin color, although nobody is the color of a band-aid, but like that's the the idea is for it to be like totally a nothing product. And then he tried to put some personality into it and sell it in a kind of more unique way and boom, you have another winner. There's still so many of these niche areas that are outstanding where you can put more thought into it. I mien your competition is

Some buyer at a big box store. Who's going to the trade show and saying, Okay, we need something that's category, we'll take that and they're buying off the shelf. Walmart's not designing fire starters or fire pokers or or right. Like it's not a big enough category for them, but You have enough of these. I mean, like you just said, Duralog does what, five hundred million dollars in sales? Man, I'm looking this up now and they don't have that many employees.

What an interesting company. And there'll be a lot of it. You guys want a piece of it? We'll do it together. Let's do it. No, what I would do, you know what I would do is I would actually copy um there's this. Guy named Ricky Van What's his name? Ricky Van Neen. He started um College humor and Vimeo.

And he sold that to IAC. And then he went and worked at Facebook and he was married to Allison Williams. So he's like this like pretty cool dude. And he started this thing called I forget what it was called. Home Homesick candles and they have a different candle flavor for every state. So if you're from Washington, maybe it would be like evergreen flavored and it's really interesting. And I would do that, but for fire logs.

And have like state flavored or some Yeah, I would do something like that. Or different kinds of wood depending on what area you're living in. Yeah. Yeah. That's cool, man. We should just open source this idea. So if a hustler from the pod listeners wants to go run with this idea, you could uh DM me or say, I'm your hustling credentials. Have you done anything before? Are you gonna make this shit happen? And then run with this idea and just carve out you know ten percent for your boys and and we're good. We will thank you. Yeah, exactly. We'll give you the initial capital to get going if you're legit. That's kind of interesting. That's a pretty cool idea. I'm gonna explore that. You know what I was thinking about when I was doing a little bit of research. I did very little research, but just enough on David's teeth to get like familiar with it. And I was just looking and it was like

I don't know, you know, there's always these metrics that I don't really fully believe, but directionally they're correct, which is like the tea market is A fifty billion dollar market expected to grow to an eighty billion dollar market. Doesn't matter what the number is, that's a big number of how much tea is sold every year. When they say a number for these, that's the annual sales volume. You know, the market for AI is X and it's just like a you know, like a valuation based thing. Right. These are real dollars being these are real dollars that are trading hands.

And um we on the last episode we talked about NFTs, which are like these kind of like crypto trading things, right? I've been looking at like how big is the trading card market and You know, for a lot of these things, it's like, Oh, it's a two billion, three billion dollar market. You have to know blockchain, you have to get into this market, it's super hard. And then you have tea that's fifty billion dollars and you have candles that's like probably eighty billion or something like that. Like these spaces that are You know, just commodities that are already adopted and uninnovated. And I think that there's so much it's so much easier to win there than it is to try to go to the new cutting edge frontier against the window. I mean you can win really big on the cutting edge frontier. So so another one I

T two other ideas I really think are bigger ideas now. One is you're talking about NFTs and of course crypto and all that stuff. I think people don't realize those people that are talking about and thinking about These big innovations that are happening now and these major disruption to our financial system, to our legal system. I think a profession.

There's gonna be a lot of people that need education around that. They're gonna have a really hard time grasping these things, these concepts, right? And I think there's a big opportunity to I don't remember those books. Remember the four dummies books. Yeah, dummies, exactly. You know, I think there's a a dummy's two point oh version that someone should really go after. To try and explain some of these concepts that are are hard to grasp. They're not easy. So I'm actually doing this one. I've just brought on a guy. A YouTube animator guy. And I'm doing the first one is

Bitcoin for normal people. I'm gonna try to create the thing that like A normal person who's heard about it, you might have even bought some or considered buying some. You've looked into it once or twice and come up with very unsatisfactory solutions where everybody's so technical and so complicated. My my dad called me. My dad called me the other day, and like my dad's seventy five, like when we FaceTime he picks up the phone and puts it to his ear and I have to remind him dad it's FaceTime, like you know. Right. And so I mean this is the least tech savvy person. He called me the other day, he's like What's Bitcoin?

No, so you're gonna have this huge audience of people that as this goes into the mainstream, that are gonna wanna understand it and they're gonna and they can't you have to talk to them in a different language. Than you would the people that listen to your podcast. I'm trying to make the video that you would forward to your dad in this case. I think this is the best explanation of What you need to know and not anything more. And it's simple English. And for me, I'm like. There's not not really a business here. I wouldn't want to do it as a business. I just really want to do it and I'd like Okay, if I take some of the earnings I made on Bitcoin.

If I just took like half a percent. And I said, All right, I'm just gonna like it's a charitable donation of like Content creation for people to learn about this stuff in simple terms, it's a good trade. It's been good to me, I can be good back to, and that can be my contribution. It's gonna end up being a big business. That's my call. It's usually the ones you're doing because you don't expect them to be a business, they end up being a business. You said the two other We just said one. What's the

The other. I think there's this big Opportunity around discovery. So Commerce has been decentralized in a way very quickly. We were kids. If you wanted to buy a pair of running shoes, you went to the mall.

And all the running shoes you could possibly buy were in the mall. Now there's so many different amazing shoe brands that How do you find them, right? Like When I Google shoes, I still see Nordstroms come up and I don't really read past the first page. I don't see Albirds, I don't see swims. You know, there's all these incredible brands out there. How did you discover them? I think you know, at one time pre-pandemic, I wrote a deck for a pop up shop ball. The idea that

Malls of the future would be all these online brands that you that you would operate. Basically, brick and mortar becomes about discovery, not distribution. It's where you go to learn about cool brands and products, and then you replenish and order online. Could you create a mall experience around that? Sean's been like geeking out over something similar about like live commerce. So I have two on that.

One is exactly what you said. Have you ever heard of beta? David? No it's it's almost exactly what you're describing. I'm gonna send you a link right here. It's B and then the letter uh sorry, the number eight. T A.com. I love B. They did exactly what you're talking about, which is they this insight. And I think this insight is spot on. And one insight like this.

Can change you know that's a hundred million dollar, five hundred million dollar insight, which is that. Malls are now gonna be for discovery, not distribution. Boom. That's the insight. You can build a career off that. You can build a huge business off that. And that's what they're doing, which was. I think Covet kinda fucked everybody who's trying to do brick and mortar, but like They were Creating these pop ups.

And I as a D to C brand can just rent it for seven days. And I basically send product and I send some education materials or I send one of my own people there, I think. Right. And they operate it. And they're sampling it, they're operating it, and I got this this footprint. I don't need to go'cause all these D C brands open up Freaking like showrooms.

And it's like, dude, that's such a pain in the ass for like It's such an expensive time consuming thing for really just trying to do marketing to get your product in front of people. And so this beta, if it works, it's like what AWS did where they were said. AWS said, Hey, you don't need to install servers and buy hardware. Just rent some off us.

And what beta's doing is saying you don't need to build stores, just rent ten square feet off us. Exactly. Great idea. Yeah. It's a huge problem right now. The cost of advertising gets higher and higher. And how do you find these places? You don't. Like you know, you ask your friends, but You know, what if your friends are at that country. By the way, this beta idea, if anybody thinks is a good idea, you can just keep doing this in every because I mean you need one in many different geolocations, right? So a college student could create beta on campuses and be like, cool, for any brand that wants to get in front of college students, I have created The network of pop-ups on every major campus, and D2C brands pay me fifty thousand dollars for an activation,$150,000 for a one-month activation. And we put product on every campus for them to get seen. Are they running it as a platform where

land like existing property owners can run the program and then get reviewed, or are they running it as they are the operators? I don't know. Actually, a good question. When they started, they were definitely the operator, but I haven't and they've been out for a few years now. Because what you're talking about is interesting, rather than rolling out. Ten thousand of these things where you're running this big staff and this and you're essentially being a landlord that operates stores. Can you outsource the model almost like a franchise to these operators.

Where these and then these job graders get reviewed right. Like'cause all you want to hold is the most valuable part, which is the relationship with the brands. One click deploy. You know, every month or you know, for three months whenever they do a new product or whatever. You just want to own that relationship. And offer them a bunch of reach. And ideally you're not paying for or managing the reach, which is what you're talking about. What did you say? You said I wrote out a deck for it.

Yeah. Uh when I left David's T, it was the first idea I had, and I had made a pitch deck, I I toyed with the idea a little bit. 'Cause at the time I mean you were starting to see the writing on the wall from malls, especially department stores. Who had all the square footage, mean they're dying.

Yeah, turn them all into nursing homes, man. Everyone should be a nursing home. Yeah, well, that's what's happening, effectively. Although some of these real estate companies are gonna make a fortune in the next ten years. You know, there's this one in Canada called Smart Centers. These guys They have all the Walmart anchored stores. And of course in the pandemic hit stock got

Killed. 'Cause all the crappy shitty clothing brands from the nineteen nineties are getting wiped out, but all these guys are doing. They have the best real estate in the suburbs, so they're taking Yes. Had where they had you know some crappy J C Penny type brand.

And they're building a multi unit residential apartment building or a seniors home and they're they're getting enormous value out of the land. And b even bigger returns, and not that they're building it at a time with rock bottom interest rates. Right before you know, where we're likely to see a lot of inflation. I think these Sounds like a lot of opportunity repurpose. Sounds like a stock to buy. What stock is that? That's smart centers. Uh but you know, there's tons of these reads in the States too. Like you gotta find the ones that

still are gonna have a decent anchor. Like Walmart stores aren't going anywhere. Івен і комерс би кам'я Everything to them. They still need that last mile. They need the real estate to to operate their e-commerce. And that and I don't know if you've been in a Walmart parking lot recently, but they're still full. People still going to the stores. It's it's those clothing brands that were hot.

Ten, twenty years ago that are gone. Right. How big When you were making this deck, how big did you project that it would be? And what did it need to become in order to interest you? Dude, a deck is fiction, girl. I know, but like a deck I imagine a deck oftentimes is not necessarily what you're making to present to people, but a way to get yourself excited and organize your thoughts. So I saw it centered around clothing. And I saw one of the issues with

e commerce as returns where you don't know you're fit. So I even looked at like could I get a fit machine? Like they have these they actually have this these machines that like you can scan and give you your body fit and you can keep it on file. So I was like, could I keep a database of everybody's body shape and be able to recommend brands based off that as well. I didn't really think about how big could this be. To me it could be enormous. I think this is

A monster I mean, this is a multi billion dollar idea, I believe. That's pretty exciting. That's cool. I like it Well, I mean, think about it, you've shipped it everybody. Yeah. I didn't do what helped me out. It's it's a big complicated idea. Yeah, it's a major commitment. Plus maybe some scar tissue from the first fitting room business. Exactly. Exactly. So I wanna ask you a question, you know, with with DMCs you guys did all these different flavors, like you would have like luscious watermelon or like

Caramel corn or whatever. And it's like cool. You're you're coming up a new product to get people excited. Great. I had heard, and tell me if this is bullshit, I'll just half relay what I remember. I heard there's some Agency, brand, annual report that comes out. And Sam, you might have been the one to tell me or Steph Smith from the hustle baby was the one who mentioned this. So tell me if you remember the name.

But they come out with a report every year and it's like this giant report and it's just like Colours. Smells. Yeah, WG S M. Yeah. Yeah, we've got them a lot. It's like uh it they do about ninety million in sales and about like forty million in profit. So is that did you guys use something like that? Is that

Yeah. Absolutely. Actually that funny you mentioned them. I was just griping about them earlier today. I've been trying to get Signed up again. For my food business and for new T brand and and like they won't they're not answering the emails. Now these guys don't want sales, I guess. But so it's W G S N They're owned by a company called Essential, I believe, which is a publicly traded company in England that owned cans. Like the festival and they own a bunch of trade shows. So I don't know if they're like doing that well, but the WGSN was like their anchor asset because it just

I don't think it doesn't really grow, but it just does the same every single year. So how do they do this and are they right? And is it like surprising the stuff? Yeah, they're right. Like they predicted like millennial pink. You know Millennial Pink, that word, Millennial Pink. I think they were talking about Millennial Pink a couple of years before that. So I mean sometimes they're you know like they're right and they're wrong, right? I mean sometimes they're way out there on some of the trends. It's just a guess. It's just a guess, exactly. And and sometimes you don't want to be the first. Some ideas, we definitely got inspiration from there. We got inspiration from adjacent industries, from the culinary world, from the fashion world. Absolutely. Like um this shade red is kind of interesting. So like maybe make your name tags that during Christmas. Right. Or merenga is a hot ingredient out of Sri Lanka, you might want to do a blend with it.

Is it based on data? Is this do they just have tastemakers? How are they doing this? Both. I think they do have in house tastemakers, people that their entire job is to go around and and look at what's new, what's hot, what's cool. You know, they're trying to find the next coconut water, right? And it's expensive. It might cost twenty five or thirty five K a year? Yeah. It depends how big you are. And they scale it up depending on the size of your company. It's a pretty interesting business and it's publicly traded, so you can go in and look at it. Really fascinating. I because David, I own this comp or uh we just sold it, but this thing called Trends, and I modeled it after a little bit after that company. Of course, we only charge three hundred dollars a year and in order to make a lot of money, we should have charged thirty thousand dollars a year.

But it's could have just charged three thousand dollars, you could have bought their report for thirty, distilled it down and offered it. Charge three there's no I like your power better, Sam. I'm going to sign up after this for three hundred bucks. That that sounds like a way better value proposition. Well that's all we we except ours isn't like niche specific. We look at like all types of interesting it's it's basically like this podcast, but way more thought out and like we have a team of researchers who like comb through all the data. And then we have a community where it's a pretty sick community where people discuss it. And it was heavily inspired by WGSN and that it's a big business, WGSN.

Absolutely. I mean most people in the product business use WGSN. All the fashion guys use it. Most of the food guys. Awesome. Well, we hit the hour, David. We uh said that we were gonna do twenty minutes. So appreciate you staying with us. It's sort of our like first date thing. We're like, Oh, I gotta meet a friend in thirty. In case the guest sucks, we can we have the excuse to wrap it up, but you were awesome. Oh dude, this was a ton of fun. I really appreciate you guys having me. I I I really enjoyed it. What's your um contact it or your your uh social presence. How should people get more? Uh Instagram at David Siegel T, the letter T. And on Twitter it is

You don't even know your Twitter handle. Never never do it. No, this is this is the biggest thing that I should have done. Underscore David Siegel. S-E-G A L. Add underscore David Siegel. And I'll start posting a lot more content as more followers come in. Did you uh all right, I'm on it now. Yeah, yeah, my friend. Uh you change your profile picture too. I think you're better looking than this pick profile picture. I think like right now, the way you look right now, you look like a cool guy. I think you could show that off better than it's a good thing. It's a little too serious. No, like you and Harley kinda have similar vibes where you like you give off the serious uh still fun and playful. Yeah, like you're gonna kick ass, but you're like fun to be around. Well listen, I mean it's it's amazing to kick ass and to try and just get better and better and bec and try and become world class, but you know

You gotta have fun. You only live once. Yeah. So anyway, just some feedback. I was I think it's good feedback. I'm I'll take a shot. Actually, I'll take this shot from this podcast. It's a good thing. That was a classic, like left handed uh Sam Parr compliment, which I'm I appreciate a lot. I'm telling you, you look better looking than your picture. All right, cool. All right, sounds good. All right, thanks, man. Thanks, Mary. Take care, guys. Bye.

What you see above is a preview of the first minutes. One unlock costs 3 credits and covers this episode forever: full segment and word-level timestamps on this page, plus .txt, .srt, .vtt and word-level JSON downloads, as many times as you like.