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March 28, 2022

Michael Ronen (Branded) - Why He's Building a Portfolio of Amazon Brands, The Aggregation Opportunity within eCommerce and Why He Left SoftBank Investment Partners

Michael Ronen (Branded) - Why He's Building a Portfolio of Amazon Brands, The Aggregation Opportunity within eCommerce and Why He Left SoftBank Investment Partners

Our guest today is Michael Ronen, co-founder and President of Branded. Branded acquires and partners with top performing Amazon sellers. So as you can imagine, we’re going to be talking about creating brands on Amazon. Previously, Michael was one of the Managing Partner’s at SoftBank Investment Partner’s historic Vision Fund 1. We discuss the opportunity within eCommerce while at SoftBank vs. Branded, building brands on Amazon vs. off Amazon.

  1. What was your initial attraction to invest in early and growth-stage companies?

How did you end up at Softbank?

Why did you leave Softbank to start Branded?

What was your initial attraction to the Amazon ecosystem?

Was there anything you thought some of the earlier aggregators were missing that lead you to want to jump in?

What are synergies amongst your portfolio?

What categories are attractive?

What’s the goal of a brand? What’s a successful revenue goal?

Modern foreign thinking brand focused on personal care

Brands that have patent or design - how is Amazon as a partner?

One company is building an incredible infrastructure - AWS

You have the intent to buy

How do you build a brand based off of a listing?

How do you build a brand on Amazon where you are just another listing?

What’s the strategy at Branded? How do you think about differentiation from others?

Why the focus on consumables?

How do you think about synergy amongst your brands?

How did you go about building your team?

What’s your approach to retaining founders?

What was your approach to fundraising?

How many companies do you look to buy?

How do you think about the best categories?

Do you get nervous about Amazon private labels?

How is Amazon a great partner?

What are your criteria for acquisition?

What are the advantages of acquiring Amazon brands vs. Shopify / DTC brands?

Does there have to be a retail / brick-and-mortar strategy in order for you to be interested in the brand?

What’s one book that inspired you personally? One book that inspired you professionally?

Lea Coca - CEO of Chrysler - Autobiography

Swim with the sharks without being alive - Harvey MacKay

“Play Nice But Win” - Michael Dell

What’s one piece of advice for founders?

Transcript
WEBVTT 1 00:00:12.439 --> 00:00:17.039 Hello and welcome to the consumer VC. I am your host, Michael but 2 00:00:17.120 --> 00:00:20.920 and on this show we talked about the world of venture capital and innovation in 3 00:00:21.000 --> 00:00:25.480 both consumer technology and consumer products. If you're enjoying this content, you could 4 00:00:25.480 --> 00:00:30.480 subscribe to my newsletter, the consumer VC DOT sub stackcom, to get each 5 00:00:30.519 --> 00:00:34.840 new episode and more consumer news delivered straight to your inbox. Our guest today 6 00:00:34.920 --> 00:00:40.679 is Michael Ronin, cofounder and president of Brandon. Branded acquires and partners with 7 00:00:40.719 --> 00:00:44.320 the top performing Amazon sellers. So, as you can imagine, we're going 8 00:00:44.359 --> 00:00:49.119 to be talking about creating and selling brands on Amazon. Previously, Michael was 9 00:00:49.159 --> 00:00:53.759 one of the managing partners at Softbank Investment Partners. Historic Vision, fun one. 10 00:00:53.880 --> 00:00:57.039 We discuss the opportunity with an e commerce while he was still a top 11 00:00:57.159 --> 00:01:02.280 bank, versus branded building brands on Amazon vers off Amazon, and much, 12 00:01:02.399 --> 00:01:11.840 much more. Without further ADO, here's Michael. Michael, thanks so much 13 00:01:11.840 --> 00:01:15.280 for joining me today. How are you doing great. Thank you. Good 14 00:01:15.319 --> 00:01:19.359 to see you. Great to see your REDC as always. You worked in 15 00:01:19.400 --> 00:01:25.239 Goldman Sachs for a long time and then you left to join sopping. What 16 00:01:25.280 --> 00:01:30.000 was your initial attraction to join? What what became sopping vision? Fun One. 17 00:01:30.159 --> 00:01:34.159 And why did you became attracted to early stage and growth stage start ups? 18 00:01:34.359 --> 00:01:38.560 Yeah, it was a fascinating twist of events. I was a Godment 19 00:01:38.640 --> 00:01:41.959 for twenty years. I grew up in Israel and moved to the states to 20 00:01:42.000 --> 00:01:45.599 get us. I got a scholarship and then ended up after business school at 21 00:01:45.640 --> 00:01:49.959 Goldman and one of the great I had a great fortune of doing some really 22 00:01:49.959 --> 00:01:53.000 interesting things because I enjoyed doing not just you know, the bankers typically are 23 00:01:53.000 --> 00:01:57.359 either telecom bankers or media bankers or Internet bankers. I I kind of straddled 24 00:01:57.359 --> 00:02:01.719 everything that was called TMT, media, tacome tech, and that got me 25 00:02:01.760 --> 00:02:06.200 in a position where I did work with Steve Jobs at apple when apple was 26 00:02:06.239 --> 00:02:10.319 going into wireless and when Steve wanted to do music deals. And guess who 27 00:02:10.360 --> 00:02:14.039 else was kind of in the same vicinity at the time, when it was 28 00:02:14.080 --> 00:02:19.960 Masayoshi Sun who negotiated at the time with Steve to get the exclusivity for the 29 00:02:19.960 --> 00:02:23.840 iphone where the iphone was launched in Japan. That was what launched Massa's amazing 30 00:02:23.879 --> 00:02:30.319 telecom run in Japan when he took over vote of phone and both Massa and 31 00:02:30.319 --> 00:02:32.759 and Steve were enamored with the music business as kind of a driver for media 32 00:02:32.840 --> 00:02:37.120 growth and for Internet growth. So long and the short of it, in 33 00:02:37.159 --> 00:02:40.039 two thousand and seventeen it was Mossle, the just was negotiating a deal to 34 00:02:40.039 --> 00:02:44.759 put together the biggest fund in the world and I went to see him in 35 00:02:44.840 --> 00:02:47.680 Japan and talk to him about what he could do with it and he said, 36 00:02:47.719 --> 00:02:51.199 instead of just giving me the advice, for telling me what to do, 37 00:02:51.240 --> 00:02:53.479 why didn't you come and do it? So that was really, if 38 00:02:53.520 --> 00:02:55.960 I had to summarize the reason, that was the reason and I look, 39 00:02:57.000 --> 00:03:01.639 I admired Massa and his vision and his capabilities and is risk taking and it 40 00:03:01.719 --> 00:03:06.280 was a once in a lifetime opportunity to try and build something pretty amazing. 41 00:03:06.319 --> 00:03:08.039 There was obviously a lot of good stuff that happened, a lot of difficult 42 00:03:08.039 --> 00:03:12.919 things that happened, but it was an amazing, amazing journey which I will 43 00:03:12.960 --> 00:03:16.479 never forget. Yeah, and I mean also just it was pretty revolutionary right. 44 00:03:16.479 --> 00:03:21.599 It was the largest no one had ever seed a venture capital fund like 45 00:03:21.759 --> 00:03:24.800 of that size by like several hundred billion. I mean it was unbelievable and 46 00:03:24.879 --> 00:03:29.120 so I'm sure just be part of that. That's just, really, really, 47 00:03:29.319 --> 00:03:31.240 just like an incredible experience, Mike. It was, you know. 48 00:03:31.240 --> 00:03:34.919 So it was a hundred billion, which at the time was literally almost the 49 00:03:34.919 --> 00:03:38.520 aggregate of most other funds. I think since then there were quite a few 50 00:03:38.520 --> 00:03:40.080 other funds that grew to be that size and I think, as you said, 51 00:03:40.120 --> 00:03:44.680 it was unprecedented and so there was real questions as to what would be 52 00:03:44.719 --> 00:03:49.039 the right strategy. I think that it has proven, and I've talked to 53 00:03:49.159 --> 00:03:53.240 quite a few other investors since then, this clearly a place for private markets 54 00:03:53.280 --> 00:04:00.000 and sophisticated private investors to help companies bridge venture into public market, so to 55 00:04:00.080 --> 00:04:04.240 be in between and help those companies grow still as private companies. You can 56 00:04:04.319 --> 00:04:09.960 argue exactly how to do that and maybe sometimes it was too much capital, 57 00:04:10.000 --> 00:04:13.240 but by and large, you know, the likes of tiger, Couto and 58 00:04:13.400 --> 00:04:15.719 what a few others have not proven that there's a lot of room for that. 59 00:04:15.759 --> 00:04:17.360 No, obviously a bunch of others now have done since. So I 60 00:04:17.399 --> 00:04:21.360 think it was an amazing kind of bold move and I think it's going to 61 00:04:21.399 --> 00:04:25.680 be, you know, it's between Sop Bank itself and a few others. 62 00:04:25.759 --> 00:04:29.000 is going to be continued opportunity and that in that area. Yeah, totally 63 00:04:29.000 --> 00:04:31.279 meansp pink. Definitely. Oh, I thought fidget Pied. What was Alete 64 00:04:31.480 --> 00:04:33.839 I had of the curve in terms of what we've been seen now over the 65 00:04:33.839 --> 00:04:36.759 past couple of years. With all this being said, you know you're at 66 00:04:36.800 --> 00:04:42.279 soft bag. You're part of the largest petric capital fied that we'd ever seen 67 00:04:42.360 --> 00:04:45.759 at that time. Why did you end up leaving and what eventually became branded? 68 00:04:46.079 --> 00:04:48.319 To be honest, I did not take myself a big break between, 69 00:04:48.360 --> 00:04:51.959 you know, almost twenty years a Goldman and three years of helping build the 70 00:04:53.360 --> 00:04:57.000 Vision Fund in the US. So the level of intensity was was quite quite 71 00:04:57.040 --> 00:05:00.959 big. It was right going into covid and I had family overseas that I 72 00:05:00.959 --> 00:05:03.720 needed to spend time with and I think just the weight of all of it 73 00:05:04.240 --> 00:05:08.199 and some of the needs that I had to kind of take care of a 74 00:05:08.199 --> 00:05:11.879 family and the likes just came together and told me that I need to take 75 00:05:11.920 --> 00:05:14.160 a break. You know, I didn't know at the time. Obviously none 76 00:05:14.160 --> 00:05:16.680 of us knew exactly how long covid will be, but that was the right 77 00:05:16.720 --> 00:05:19.480 thing for me to do. And and you know, the Fund was launched 78 00:05:19.519 --> 00:05:24.839 and I've invested five billion as part of the team that that funded and those 79 00:05:24.879 --> 00:05:28.360 investments were doing well. So I felt like I've done what I needed to 80 00:05:28.360 --> 00:05:30.879 do to build and and launch, but I needed to take the break. 81 00:05:30.879 --> 00:05:34.360 What I thought I'm going to do is just raise a fun myself and do 82 00:05:34.439 --> 00:05:38.879 something a bit less ambitious than the Vision Fund, but do it more myself 83 00:05:38.920 --> 00:05:43.199 as entrepreneur. And what happened actually, as I was beginning to do some 84 00:05:43.279 --> 00:05:46.639 of my own investing, was I came across the opportunity to do branded, 85 00:05:46.800 --> 00:05:51.240 to work with branded and to actually help build the company. was initiated by 86 00:05:51.279 --> 00:05:55.639 a couple people that I knew very well. Ben Kaminski was an investor at 87 00:05:55.639 --> 00:05:59.839 a fun called target global in Europe and we connected with Pierre, my partners 88 00:06:00.040 --> 00:06:02.199 no running branded with me out of Paris, and what I thought would be 89 00:06:02.240 --> 00:06:05.720 just an investment and a board position, which I was kind of used to, 90 00:06:06.279 --> 00:06:10.839 very quickly became an opportunity to actually build a company, which I've never 91 00:06:10.879 --> 00:06:14.079 done before. So I helped build the Vision Fund. I recruited fifteen, 92 00:06:14.160 --> 00:06:16.639 twenty people and to my team and I helped recruited, but it wasn't really 93 00:06:16.680 --> 00:06:19.600 building a company. was in the investment area, which was was kind of 94 00:06:19.600 --> 00:06:23.839 more natural to me. This is an operating company and a scale up and 95 00:06:23.879 --> 00:06:29.120 I've only done that as a board member and investor, but not as as 96 00:06:29.120 --> 00:06:31.720 that you know did. This is a difference between saying something and actually doing 97 00:06:31.759 --> 00:06:35.600 it. So you say it on the board and then somebody else does the 98 00:06:35.600 --> 00:06:40.560 work. Maybe this is kind of the opportunity to actually to actually do it, 99 00:06:40.600 --> 00:06:44.720 and that was and it's in the sweet spot of my skill set. 100 00:06:44.839 --> 00:06:51.160 So branded is a growth equity company. It's absorbing small ECOMMERCE companies and helping 101 00:06:51.160 --> 00:06:55.959 them grow as an element of investment, as an element of scale up. 102 00:06:56.079 --> 00:06:59.000 So a lot of things that I've had quite a lot of experience with. 103 00:06:59.439 --> 00:07:02.839 So I you know, it's in the days of covid where everybody was distributed. 104 00:07:02.839 --> 00:07:06.360 anyways, I found it really a unique opportunity to partner with people in 105 00:07:06.399 --> 00:07:12.920 Singapore and Europe Middle East and just build a company from scratch and I've not 106 00:07:12.959 --> 00:07:15.199 looked back. You know, it's been amazing. That's phenomenal. I mean, 107 00:07:15.240 --> 00:07:20.120 what was that decision like though? Going from you just becoming like an 108 00:07:20.279 --> 00:07:25.040 LP, not an activestor just invested in branded, you actually, you know, 109 00:07:25.079 --> 00:07:27.480 become a a Co founder, you actually in much more of like an 110 00:07:27.480 --> 00:07:33.480 operating role. What was you or initial attraction by the Amazon ecosis and maybe 111 00:07:33.519 --> 00:07:38.079 that, maybe you just couldn't escape that you wanted to be part of branded 112 00:07:38.120 --> 00:07:41.240 in a much more hands on way. So I think there was a couple 113 00:07:41.279 --> 00:07:46.519 of things there. Number one, at Softbank one of my key thesis, 114 00:07:46.800 --> 00:07:50.839 was the talk to Mussu about, was to deploy very large scale capital. 115 00:07:50.839 --> 00:07:57.040 In technology you need very big problems that are capital intensive. So the traditional 116 00:07:57.040 --> 00:08:00.920 as we talked about traditional venture has been more modest in terms of capital and 117 00:08:00.959 --> 00:08:05.720 to me one of the biggest opportunities was helping organize the ECOMMERCE ecosystem. That 118 00:08:05.839 --> 00:08:11.439 is not Amazon. So obviously Amazon itself created not just great businesses but a 119 00:08:11.439 --> 00:08:16.519 great business model where they grow a business internally for their own use and then 120 00:08:16.639 --> 00:08:22.560 leverage third parties to help fund it to further scale. So they grew the 121 00:08:22.600 --> 00:08:26.879 cloud business first just so they can service consumers around the world and ultimately rented 122 00:08:26.920 --> 00:08:31.440 that cloud business and what became aws and an amazing business for themselves. They 123 00:08:31.519 --> 00:08:35.840 done the same thing with the market place. They it was first there's first, 124 00:08:37.000 --> 00:08:39.080 you know, a first party market place where they are the seller, 125 00:08:39.200 --> 00:08:43.200 and then they opened up to third parties and built an amazing business. Everybody 126 00:08:43.240 --> 00:08:46.799 else. And around that they built a hundred plus million households on prime. 127 00:08:46.039 --> 00:08:50.080 So they had customers coming them every day, every minute, and they build 128 00:08:50.080 --> 00:08:54.480 a massive infrastructure of warehouses, planes, trains, everything that connects them, 129 00:08:54.559 --> 00:09:01.360 robots and everything that allows you to click by now and get it within twenty 130 00:09:01.360 --> 00:09:05.039 four hours to your doorstep. Everybody else that is not Amazon, and that 131 00:09:05.159 --> 00:09:09.120 includes some very, very big names, needed to respond and I thought that 132 00:09:09.200 --> 00:09:13.799 if there's one big group that is international, has e commerce roots in Ali 133 00:09:13.840 --> 00:09:18.320 Baba and the likes, that can actually help organize that with capital and expertise 134 00:09:18.360 --> 00:09:24.039 with soft bank. So I invested in everything from Metano's delivery to freight forwarding. 135 00:09:24.159 --> 00:09:28.039 So flex board companies are that help, a neuroe companies that help delivery 136 00:09:28.120 --> 00:09:35.120 and parking, which was turned into kind of less mile mobility hubs in reef, 137 00:09:35.200 --> 00:09:39.919 and Gopoff, which is an amazing new business that does very quick delivery. 138 00:09:39.960 --> 00:09:43.639 So so I invested on all those themes and then, coming out of 139 00:09:43.679 --> 00:09:46.120 sopping, taking the break and looking at what's out there, it became clear 140 00:09:46.159 --> 00:09:50.679 that I have an opportunity to invest and to be part of the Amazon ecosystem 141 00:09:50.759 --> 00:09:56.879 by building branded into a company that can take the small businesses that grew up 142 00:09:56.919 --> 00:10:01.639 on the back of Amazon's infrastructure and help them get to the next level. 143 00:10:01.679 --> 00:10:05.960 And so that was quite a natural transition and again it was leveraging both the 144 00:10:07.039 --> 00:10:11.639 knowledge that I gained at Softbank but also just the skill set of acquisition and 145 00:10:11.679 --> 00:10:16.159 investment and scale up that I've developed. Since Amazon has decades ahead of it 146 00:10:16.240 --> 00:10:24.159 of successful strength in e commerce. They've the what they've built has decades of 147 00:10:24.200 --> 00:10:28.360 strength ahead of it. It says talking to Microsoft thirty or forty years ago 148 00:10:28.480 --> 00:10:31.679 as peace, he's started to, you know, flourish, and they were 149 00:10:31.799 --> 00:10:35.600 the fact of the operating system. Of course there was apple, there was 150 00:10:35.600 --> 00:10:37.639 out of other operating systems, ultimate, there was mobile, but there were 151 00:10:37.679 --> 00:10:43.720 decades of value created in that ecosystem and I think, I think Amazon has 152 00:10:43.759 --> 00:10:48.840 the same so helping organize e commerce that is not inside Amazon does not take 153 00:10:48.840 --> 00:10:54.039 away from their continued growth. It was just helping creating a balance right, 154 00:10:54.039 --> 00:11:00.039 and obviously there's market places outside the US like Atibaba and many, many others 155 00:11:00.080 --> 00:11:03.519 where that has happened. But yes, I think then this is where I 156 00:11:03.600 --> 00:11:07.399 you know, the mission of branded is interesting in compelling not just to me 157 00:11:07.480 --> 00:11:13.000 but to many of the younger people that we attract, both as sellers that 158 00:11:13.080 --> 00:11:16.600 come to us to partner with us when they sell us their business, but 159 00:11:16.679 --> 00:11:24.480 also employees. What resonates with them is Amazon empowered them to become business people, 160 00:11:24.519 --> 00:11:26.519 to actually, you know, if you were twenty, five or thirty 161 00:11:26.559 --> 00:11:30.960 years old, ten fifteen years ago, you couldn't really get to be a 162 00:11:30.960 --> 00:11:33.480 business owner online. It was the barriest. Entry was so high. So 163 00:11:33.519 --> 00:11:37.440 obviously shop, if I helped on direct to consumer, and they're still an 164 00:11:37.519 --> 00:11:41.679 amazing platform to do that and there's still a lot of work to do there. 165 00:11:41.679 --> 00:11:46.000 But Amazon, by opening up their market place and the fulfillment by Amazon 166 00:11:46.039 --> 00:11:50.360 Platform Sunny, enabled anyone, and talk about covid anyone, anywhere, from 167 00:11:50.399 --> 00:11:54.720 any home and any location, if they're commercial, they're smart, if they're 168 00:11:54.759 --> 00:12:00.240 able to work really hard and and find the right business to become a business 169 00:12:00.279 --> 00:12:03.799 owner, a small business owner online, and that just didn't exist before. 170 00:12:03.799 --> 00:12:07.559 You could not be either were an adventure business of starting a company and hoping 171 00:12:07.600 --> 00:12:11.240 to get funded and hit it big or you would fail. Ninety nine times 172 00:12:11.240 --> 00:12:13.200 out of a hundred, the idea of having a small business online that can 173 00:12:13.240 --> 00:12:18.600 be profitable two thousand and twenty five percent, thirty percent profit margins didn't exist. 174 00:12:18.679 --> 00:12:20.639 And so now the question is, how do you help and this goes 175 00:12:20.679 --> 00:12:24.440 back to the mission. The mission that we have is the ones who succeeded 176 00:12:24.480 --> 00:12:30.000 from zero to one already did it without us a branded they just leveraged Amazon 177 00:12:30.080 --> 00:12:31.879 and be very good at what they've done. How do we help them take 178 00:12:31.919 --> 00:12:35.799 the one to ten and help them in many cases, be all partners in 179 00:12:35.799 --> 00:12:39.639 doing that? So come to our platform, work with branded and try and 180 00:12:39.679 --> 00:12:46.480 find the niches, the places where their expertise, plus our capabilities and experiences, 181 00:12:46.480 --> 00:12:50.440 can actually take a brand that already got off the ground so much, 182 00:12:50.519 --> 00:12:54.519 much bigger opportunity and that empowering small business owners that way online and just making 183 00:12:54.559 --> 00:12:58.399 them creating wealth for them that get does well for them and the economy and 184 00:12:58.399 --> 00:13:03.559 creating an opportunity for them to flourish and and grow their business, and doing 185 00:13:03.559 --> 00:13:05.879 that in a partnership type of model is quite unique. How do you think 186 00:13:05.919 --> 00:13:11.159 about that differentiation amongst other funds, because, of course you're not the only 187 00:13:11.200 --> 00:13:16.480 ones that are buying predominantly Amazon businesses and you know, having a a portfolio 188 00:13:16.639 --> 00:13:20.200 of, you know, start perform members that businesses. How do you think 189 00:13:20.279 --> 00:13:26.440 about players of their market and maybe differentiation why Amazon merchant, am'Zon seller might 190 00:13:26.480 --> 00:13:30.279 be more interested in branded versus like one of the other players? This is 191 00:13:30.320 --> 00:13:37.000 a big and growing ocean with lots of fish and lots of opportunities to create 192 00:13:37.039 --> 00:13:41.399 phishing strategies and great kind of strategies around that. And there's there's plenty of 193 00:13:41.440 --> 00:13:46.879 an opportunity and what is still ECOMMERCE is still underpenetrated. It had a big, 194 00:13:46.879 --> 00:13:50.519 big boost in in the COVID pandemic. That's coming down, but long 195 00:13:50.639 --> 00:13:56.519 term we're all going to continue and migrate our shopping experiences. It's not just 196 00:13:56.559 --> 00:14:01.399 because we or the younger generation, it's because younger generations are replacing older generations 197 00:14:01.399 --> 00:14:05.480 and that trend continues to evolve. So this is not in the expense of 198 00:14:05.639 --> 00:14:09.639 of others. This is just as what makes us tick. So what makes 199 00:14:09.679 --> 00:14:15.559 the branded team tick and makes it quite different, is that, rather than 200 00:14:15.840 --> 00:14:20.559 I think there is clearly a case of just doing the basics to help small 201 00:14:20.559 --> 00:14:24.440 brands get better and bigger. Basics are pretty complex and we're not the only 202 00:14:24.440 --> 00:14:30.080 ones or doing that, but they include better inventory management, better listings, 203 00:14:30.080 --> 00:14:35.200 better marketing, better performance marketing and what we would call growth hacking, the 204 00:14:35.240 --> 00:14:41.240 ability to scale also into other market places and other regions. Clearly we're doing 205 00:14:41.279 --> 00:14:43.879 that. We have to do that and proved and we do that in partnership 206 00:14:43.919 --> 00:14:50.879 many times with the entrepreneurs. What diffrenchiates us is we also are building quite 207 00:14:50.919 --> 00:14:56.799 a few of these products and sets of products and early brands into branded groups 208 00:14:56.840 --> 00:15:01.279 and branded products. By that I mean we're leaning into categories. First of 209 00:15:01.279 --> 00:15:05.240 all, you need to be in the right categories. If you're selling generic 210 00:15:05.240 --> 00:15:09.399 plastic tools or or some household products, there's no need for a brand. 211 00:15:09.440 --> 00:15:16.039 Amazon solve that by giving ratings and customer reviews and the consumers choose them based 212 00:15:16.080 --> 00:15:20.759 on functionality and reviews. But if you're choosing, you know, a if 213 00:15:20.759 --> 00:15:24.480 you're if you've embarked on a diet and you're trying to find the right nutrients 214 00:15:24.519 --> 00:15:28.360 to support you on that diet, or if you're in you know you have 215 00:15:28.440 --> 00:15:33.360 a beauty regiment and you're looking to invest in yourself in that, those will 216 00:15:33.399 --> 00:15:37.399 be categories where people look for social affirmation for brands, for emerging brands. 217 00:15:37.600 --> 00:15:41.080 They listen to influencers, they listen to their friends, they look for a 218 00:15:41.080 --> 00:15:45.519 brand, even obviously they look for the traditional brands in many cases. But 219 00:15:45.559 --> 00:15:48.360 as we talk about new consumers getting online, a lot of it is new, 220 00:15:48.519 --> 00:15:52.600 new opportunities, and those are the categories were we've invested deeply in and 221 00:15:52.639 --> 00:15:56.440 in those if you and this goes back to our value proposition, our value 222 00:15:56.440 --> 00:16:02.240 proposition to the entrepreneurs is, you know, join us. In many cases 223 00:16:02.360 --> 00:16:06.279 we actually will have you join the platform, so you will be either an 224 00:16:06.279 --> 00:16:10.360 employee or advisor to branded and you can continue and build your brand. You 225 00:16:10.399 --> 00:16:14.519 already done the hard work of going from zero to one by yourself. Continue 226 00:16:14.559 --> 00:16:18.759 to do that with us. Will surround you with a lot of support systems 227 00:16:18.759 --> 00:16:22.879 and infrastructure and a team and the systems and the disciplines that will allow you 228 00:16:22.919 --> 00:16:26.279 to grow, take you overseas, expand your product for you, invest in 229 00:16:26.320 --> 00:16:30.799 new products, etc. And you will have a residual value and your own 230 00:16:30.799 --> 00:16:36.519 brand will pay you again ultimately when you leave, based on the growth and 231 00:16:36.559 --> 00:16:38.960 the equity that we've created in doing so. So it's a little bit of 232 00:16:40.000 --> 00:16:44.200 the best of both worlds for the ones who are passionate about the brands. 233 00:16:44.240 --> 00:16:48.840 If all you're interested in is just selling and moving on and doing something else 234 00:16:48.840 --> 00:16:51.240 in life and you don't see a lot of upside in your own brand or 235 00:16:51.279 --> 00:16:53.360 you don't see what we see, then either will buy it anyways and just 236 00:16:53.399 --> 00:16:57.720 not have you be part of our group. But most likely we'll probably won't 237 00:16:57.720 --> 00:17:03.240 be the right buyers in many cases because the value creation isn't there. Being 238 00:17:03.279 --> 00:17:07.440 in the sectors that are branded, creating three year plans to brand and grow 239 00:17:07.480 --> 00:17:11.480 and bringing the entrepreneurs with us for that journey in many cases is quite quite 240 00:17:11.519 --> 00:17:18.119 differentiating. So the Ideal Partnership for you is you buy the company and the 241 00:17:18.240 --> 00:17:23.400 entrepreneur stays on board as CEO or head of company and obviously utilizing your team, 242 00:17:23.400 --> 00:17:29.920 your expertise, maybe some cost savings in inventory management and what have you, 243 00:17:30.000 --> 00:17:33.240 but the opera actually stays on to kind of see through the journey. 244 00:17:33.279 --> 00:17:36.359 Is that right? Yeah, many cases that's the case. We have over 245 00:17:36.400 --> 00:17:38.319 a dozen. You know, we have quite a few that have joined us 246 00:17:38.359 --> 00:17:41.799 just in the past year. It's a high bar because it needs to work 247 00:17:41.839 --> 00:17:47.759 for both sides. So it's not we're not just buying every we never boasted. 248 00:17:48.640 --> 00:17:49.920 That was never our thing to say, Oh wow, we've buying a 249 00:17:49.960 --> 00:17:53.160 company every day or every week or every two days or whatnot. That's not 250 00:17:53.200 --> 00:17:57.000 the way we measure ourselves. It's really about so it's less of a throughput 251 00:17:57.039 --> 00:18:00.839 of just acquiring products you know we would occasionally buy. You know, there's 252 00:18:00.839 --> 00:18:06.200 money to be made and value to create by buying, you know, less 253 00:18:06.240 --> 00:18:07.799 branded things, if you will, if you want to call it that way, 254 00:18:07.839 --> 00:18:11.000 but the core value over time. Look, this is true in general 255 00:18:11.079 --> 00:18:15.000 and consumer package goods. You can't, you know, if P G was 256 00:18:15.039 --> 00:18:18.079 selling exactly the same products that they was selling ten years ago, it would 257 00:18:18.119 --> 00:18:21.119 be out of business. You got it. You know, consumer taste change. 258 00:18:21.160 --> 00:18:25.119 You need to refresh, you need to expand, you need to move 259 00:18:25.160 --> 00:18:27.880 to where the the market is going. So that is the value proposition for 260 00:18:27.960 --> 00:18:33.079 us with with entrepreneurs to join us to help them do that. So what 261 00:18:33.079 --> 00:18:37.519 what categories do you deed, as it attractive to if you maybe have like 262 00:18:37.680 --> 00:18:44.279 large MACARO categories that you're quite interested in, do you invest in maybe multiple 263 00:18:44.279 --> 00:18:48.400 brands within maybe you in one category? So they should. The answer the 264 00:18:48.480 --> 00:18:51.599 second question is yes, because the niche should you know, the whoy ideas, 265 00:18:52.599 --> 00:18:56.839 or part of the thesis is that in a Fragmented World where all of 266 00:18:56.880 --> 00:19:00.640 us are getting a different news feed and a different social feed, there's room 267 00:19:00.680 --> 00:19:04.759 from multiple brands that are brands of people will look for by name and associate 268 00:19:04.799 --> 00:19:08.759 a certain value to it. But it's not just about the Super Bowl ad 269 00:19:08.759 --> 00:19:15.119 and and you know, the the prime time add but it's about brands that 270 00:19:15.160 --> 00:19:19.079 are challenger brands that are carving their niches inside the market place, targeting and 271 00:19:19.160 --> 00:19:25.480 demographic targeting a certain value proposition to you know, we should have quite a 272 00:19:25.480 --> 00:19:29.039 few of them in the in the niche. Sometimes they'll have some overlap in 273 00:19:29.279 --> 00:19:32.559 that is there and sometimes they'll be complimentary. I'll give you an example. 274 00:19:32.680 --> 00:19:36.799 We you know we we own a brand called Puacy, which has a nice 275 00:19:36.839 --> 00:19:41.319 presence on Amazon and outside Amazon and physical distribution and isn't target stores and elsewhere. 276 00:19:41.319 --> 00:19:45.680 But we recently invested in a brand and and it's value proposite. It's 277 00:19:45.839 --> 00:19:52.759 very much a modern, forward thinking brand focused on natural products for personal care 278 00:19:52.799 --> 00:19:59.039 and cleaning etc. We didn't have a laundry detergent in that category right so 279 00:19:59.079 --> 00:20:03.519 we had the didn't exist now we can. We have the people that know 280 00:20:03.559 --> 00:20:07.880 how, they expertise a supply chain to obviously expand and create a purecy product 281 00:20:07.920 --> 00:20:11.640 in that area. But we just recently bought another brand called Rock and green 282 00:20:11.640 --> 00:20:15.039 that does just that. Has a century the same value proposition to consumers, 283 00:20:15.039 --> 00:20:19.119 but it's just limited into the the laundry and laundry detergent area. Now we 284 00:20:19.160 --> 00:20:23.680 have two brands, you know and and rocking green can be purposed also as 285 00:20:23.720 --> 00:20:27.559 a purecy product, but we can still sell as a niche rocking green. 286 00:20:27.680 --> 00:20:32.960 So there is ability to create. If you're running yourself in categories and he 287 00:20:33.039 --> 00:20:37.759 creating a strategic portfolio products, you can actually create real synergies, even if 288 00:20:37.799 --> 00:20:42.559 those is overlap, because you can repurpose and change the messaging further. Demographic 289 00:20:42.599 --> 00:20:49.000 so that you know those categories consumables, beauty and personal care, health, 290 00:20:49.319 --> 00:20:56.720 nutrition, those are categories where people are passionate. There's enthusiastic kind of followship 291 00:20:56.720 --> 00:21:00.640 on social we can build also legs in directed and summer over time because it's 292 00:21:00.640 --> 00:21:07.799 easier to target these audiences and their clear and they're replenishable people by definition. 293 00:21:07.839 --> 00:21:11.200 If you're do a good job and you selling people something they like, they'll 294 00:21:11.240 --> 00:21:15.400 reorder, they'll subscribe. So we like those categories a lot. We also 295 00:21:15.480 --> 00:21:21.680 like categories where there's other differentiation. So we own a couple of brands that 296 00:21:21.759 --> 00:21:27.599 have either patents or design protection on on their Ip and so we can, 297 00:21:27.880 --> 00:21:32.119 you know, they cannot be copied without repercussion. You know, if somebody's 298 00:21:32.200 --> 00:21:36.839 just copycatting us, we can talk to Amazon take them down and we have 299 00:21:36.920 --> 00:21:41.039 shelf space for them because they're so unique and because people actually you know, 300 00:21:41.079 --> 00:21:48.359 one brand called Ototoe, which is kind of a uniquely design novelty home goods, 301 00:21:48.480 --> 00:21:52.359 kitchen and the likes. There's nothing that that looks like it and people 302 00:21:52.559 --> 00:21:55.400 want that. Will Get that and we'll look. They will go online and 303 00:21:55.480 --> 00:21:59.720 find it and then either order it on Amazon or direct or find it in 304 00:21:59.759 --> 00:22:04.119 retail. And Anybody's copying the product, copycat you know, will have some 305 00:22:04.279 --> 00:22:08.640 rip, you know, ability to to take down. So those, those 306 00:22:08.640 --> 00:22:12.359 are the like the ones that we like the most. Is the goal ultimately 307 00:22:12.519 --> 00:22:17.680 to buy and hold all the companies that you own, or are you also 308 00:22:17.799 --> 00:22:22.759 looking to for exits as well, or or even like exit opportunities for some 309 00:22:22.799 --> 00:22:26.839 of the brants of your building? So we're not a fund, we're an 310 00:22:26.839 --> 00:22:30.359 operating company. We have a couple hundred people that are they to day running. 311 00:22:30.440 --> 00:22:34.240 We're not minority investors, we're not financial you know I have financial training, 312 00:22:34.279 --> 00:22:38.319 but we're the company is an operating company that is very much looks like 313 00:22:38.319 --> 00:22:45.400 a very nimble consumer package goods online company. Our goal is to, you 314 00:22:45.440 --> 00:22:52.119 know, to invest smartly, choir and some many cases, partner with entrepreneurs, 315 00:22:52.160 --> 00:22:55.680 as we said, and create a great portfolio or brands and some key 316 00:22:55.720 --> 00:23:00.359 categories that can grow and create value, obviously for for the company, for, 317 00:23:00.640 --> 00:23:03.559 you know, some of the entrepreneurs are joined us, and for investors. 318 00:23:03.559 --> 00:23:07.599 We're not planning to, you know, sell pieces of it or or 319 00:23:07.640 --> 00:23:12.039 do anything of that sort. But again, if you're managing bike category, 320 00:23:12.119 --> 00:23:17.119 if you have life cycle of brands and products, obviously, at any point 321 00:23:17.119 --> 00:23:21.039 of time, again, you see it in the consumer package goods kind of 322 00:23:21.079 --> 00:23:23.839 traditional businesses, you could trade. You can say, Hey, I'm I 323 00:23:23.880 --> 00:23:29.599 need a growth brand here. I will sell you my other asset and you 324 00:23:29.599 --> 00:23:33.359 can sell me your, you know, the one that we cover it. 325 00:23:33.440 --> 00:23:37.319 So those, those opportunities obviously could evolve over time very naturally as we do 326 00:23:37.359 --> 00:23:41.400 this and the long term value creation will be when, you know, obviously 327 00:23:41.599 --> 00:23:44.680 we can do what companies do. We can decide to at some point list 328 00:23:44.759 --> 00:23:48.240 and become a public company. You know we can create value in many different 329 00:23:48.240 --> 00:23:52.599 ways, but if what we do at the end of the day is take 330 00:23:52.640 --> 00:23:56.440 businesses, want to emphasize this is not about you know, there's there's cost 331 00:23:56.480 --> 00:24:00.519 efficiencies in creating things at scale, but a lot of those cost efficiencies, 332 00:24:00.640 --> 00:24:04.440 certainly on the Amazon market place, have been created by Amazon and they're ripping 333 00:24:04.440 --> 00:24:08.079 the rewards of that. And so whether we're fifty million of branded and five 334 00:24:08.160 --> 00:24:11.960 hundred million branded or a billion dollars of revenues of branded, we already are 335 00:24:12.000 --> 00:24:17.559 benefiting from that about the same way as anyone else who's working with Amazon. 336 00:24:17.599 --> 00:24:22.759 We're all benefiting from their scale. The value we create won't be from necessarily 337 00:24:22.799 --> 00:24:26.839 they will be value created from efficiencies, but the real value creation is from 338 00:24:26.880 --> 00:24:32.720 growth and investment in creativity and product generation and new product launches and expansion of 339 00:24:33.319 --> 00:24:38.440 the footprint. And that is the mindset everybody branded is a builder grower of 340 00:24:38.480 --> 00:24:45.359 businesses rather than a efficient you know they you want to do it as efficiently 341 00:24:45.359 --> 00:24:49.000 as possible, but boy the businesses we are buying a very lean already. 342 00:24:49.000 --> 00:24:52.880 You know there it's not. We're not seeing a lot of small businesses with 343 00:24:52.920 --> 00:24:56.720 private jets and three limousines, you know, driving the entrepreneur back and forth 344 00:24:56.759 --> 00:25:02.000 from there. These are lean businesses that need our help to grow. So 345 00:25:02.119 --> 00:25:06.279 our game is a growth game since, like the idea is to scale the 346 00:25:06.319 --> 00:25:11.039 brand initially on Amazon. How do you think about Amazon as a partner, 347 00:25:11.079 --> 00:25:15.319 because obviously they have their own private label. They've been known, or there's 348 00:25:15.359 --> 00:25:18.599 been talks and another. There are stories out there about how Amazon, you 349 00:25:18.599 --> 00:25:22.400 know, copies the best products and what have you, especially when you think 350 00:25:22.440 --> 00:25:26.200 about your differentiate your product and your pikets that are patented. How do you 351 00:25:26.359 --> 00:25:30.680 think of Amazon as a partner when they're also producing their own brand as well? 352 00:25:30.720 --> 00:25:34.279 I view them exactly as as you've described, their great partner in the 353 00:25:34.319 --> 00:25:40.240 sense that they're letting us and many others leverage their capabilities, what they're good 354 00:25:40.279 --> 00:25:45.680 at, and they're doing it across the board and allowing us to do that, 355 00:25:45.759 --> 00:25:49.000 and I accept them to also do the soul started from them building the 356 00:25:49.039 --> 00:25:52.759 infrastructure for themselves, and so I expect them to continue to do that. 357 00:25:52.799 --> 00:25:56.960 As well. And you know, if there's one thing that we're not lacking, 358 00:25:57.039 --> 00:26:03.079 its competition, and whether it's competition from Amazon or from other brands. 359 00:26:03.160 --> 00:26:06.160 The amazing thing that, as a consumer, and we all feel this, 360 00:26:06.480 --> 00:26:12.680 we get is an unbelievably competitive marketplace that yields consumers great value, right, 361 00:26:12.720 --> 00:26:18.880 and whether it's an Amazon brand that competes with us, or it's another aggregator 362 00:26:18.079 --> 00:26:22.200 or it's just an upandcoming brand from somewhere. And you know what I we 363 00:26:22.519 --> 00:26:27.559 don't lack competition anywhere we play. It's a hyper competitive and so I think 364 00:26:27.599 --> 00:26:32.920 that goes back to the reason that we're constructing the business the way we do. 365 00:26:33.000 --> 00:26:38.559 What helps. You know, the reason somebody invented brands was to begin 366 00:26:38.640 --> 00:26:45.880 to differentiate, right, because there's subtle ways to connect with consumers on a 367 00:26:45.920 --> 00:26:51.759 subconscious level, almost with a name and a vision and a certain set of 368 00:26:51.839 --> 00:26:56.799 values in a certain set of things you deliver to them. That allows consumers 369 00:26:56.880 --> 00:27:00.960 ultimate to find you, if they like you, not by yet again searching 370 00:27:00.960 --> 00:27:04.519 for the best product at the you know, but by finding you by name. 371 00:27:06.119 --> 00:27:07.880 So if we do that, and we do that well enough across enough 372 00:27:07.920 --> 00:27:12.599 of our brands, then whether it's Amazon competing with us or it's other other 373 00:27:12.640 --> 00:27:15.960 brands. You know, by and large, will continue to get enough of 374 00:27:15.960 --> 00:27:21.480 our more than our fair share of consumers coming to us without US needing to 375 00:27:21.519 --> 00:27:25.599 constantly bid for their attention, and that's the whole point of our strategy. 376 00:27:25.640 --> 00:27:30.319 Do you ever have inclinations of buying businesses that are predominantly sold probably selling through 377 00:27:30.319 --> 00:27:33.880 their own channels and my shopify or a better not Amazon. We've made a 378 00:27:33.920 --> 00:27:37.599 couple of those investments, especially when we see the opportunity to again create some 379 00:27:37.720 --> 00:27:44.519 value with some of our other brands. There's clearly an opportunity that is emerging 380 00:27:44.559 --> 00:27:47.440 also in that area, the fact that, you know, Amazon is just 381 00:27:47.519 --> 00:27:51.319 a template and a place where it's very clear and now there's a market, 382 00:27:51.319 --> 00:27:55.680 there's sophisticated market, a buy sellers and it's very clear. You know there 383 00:27:55.720 --> 00:28:00.160 are the you know the opportunity is quite visible. shopify is organizing essentially, 384 00:28:00.200 --> 00:28:03.799 and obviously there's others as well, but by far kind of the scale play 385 00:28:03.880 --> 00:28:07.480 right now off of Amazon and directed consumers to do that on the back of 386 00:28:07.519 --> 00:28:11.759 the shopify platform. Again, there's others that are much smaller as well, 387 00:28:11.799 --> 00:28:12.839 and I think there is a you know, at the end of the day, 388 00:28:12.880 --> 00:28:18.359 there's obviously a place where you can bring similar values in that ecosystem as 389 00:28:18.359 --> 00:28:23.359 well. The big difference at the very the macro level, is on Amazon. 390 00:28:23.640 --> 00:28:27.480 What Amazon does is it brings you the customers with an intention to buy 391 00:28:27.519 --> 00:28:30.920 the products or buying. So now it's really up to you as a brand 392 00:28:30.960 --> 00:28:34.680 to stand out and find them and obviously, you know, get get their 393 00:28:34.720 --> 00:28:40.400 attention and but they already have any intention to buy right they came into Amazon 394 00:28:40.400 --> 00:28:42.039 because they wanted to buy something. That, hopefully, is part of what 395 00:28:42.160 --> 00:28:47.880 your portfolio is. In the case of directed consumer the big issue is always 396 00:28:47.920 --> 00:28:52.640 going to be privacy versus effectiveness, and we're obviously in the middle of that 397 00:28:52.000 --> 00:28:59.200 pendulum swinging back and forth. In the US, apple has increased privacy constraints 398 00:28:59.200 --> 00:29:03.200 on the likes of Instagram and Meta and whatnot, because people open, you 399 00:29:03.240 --> 00:29:07.480 know, light up, myself included, light up. We light up our 400 00:29:07.480 --> 00:29:10.839 iphones before we have any intention to buy anything and we go into instagram not 401 00:29:10.839 --> 00:29:15.680 necessarily wanting to buy. And so, you know, the somebody needs to 402 00:29:15.720 --> 00:29:19.400 find us while we're doing other things, surfing the web or to and direct 403 00:29:19.440 --> 00:29:25.279 our attention to buy, and that requires getting through some privacy things is otherwise, 404 00:29:25.599 --> 00:29:27.920 you know there's no intention to buy, and so the economics as a 405 00:29:27.960 --> 00:29:32.240 result of that are very different. If you're just trying to find the people 406 00:29:32.359 --> 00:29:34.480 that already are want to buy and you just need to direct them your way, 407 00:29:34.519 --> 00:29:37.240 you have to make a certain investment in marketing and then get your margin 408 00:29:37.359 --> 00:29:41.200 after that through Amazon. If you actually just trying to find the traffic to 409 00:29:41.200 --> 00:29:45.200 bring into you to convert into an intention to buy, to convert ultimately into 410 00:29:45.279 --> 00:29:48.640 a purchase with it, that's a completely different funnel. It's completely different skill 411 00:29:48.680 --> 00:29:53.480 set. The economics are not completely settled because of all the backs and the 412 00:29:53.519 --> 00:29:56.799 way the world is changing. It's harder to charget now on IOS and it 413 00:29:56.920 --> 00:30:00.000 was six months ago or a year ago. So so I think we're much 414 00:30:00.039 --> 00:30:06.559 more cautious over time. If you have great products, you find your customers 415 00:30:06.640 --> 00:30:10.720 online, whether through Amazon otherwise. You'll be able to build legs that are 416 00:30:10.759 --> 00:30:14.880 in both places and manage them correctly. But then we're in the very early 417 00:30:14.920 --> 00:30:19.160 stages of both ecosystems evolving though it. Yeah, that's a really good and 418 00:30:19.200 --> 00:30:23.799 that's like that I thought about initially about me certainly like the inten to buy 419 00:30:23.799 --> 00:30:27.960 any of that. That power of the search bar in Amazon and having this 420 00:30:29.039 --> 00:30:33.039 kind of centralized system to find what you want to buy extremely powerful, extremely 421 00:30:33.039 --> 00:30:34.759 powerful for customers. I think it's going to go both ways. So I 422 00:30:34.759 --> 00:30:38.160 think Amazon is already doing this. You know, people don't want to just 423 00:30:38.200 --> 00:30:41.119 go to Amazon. I do believe Amazon has such so much power to be 424 00:30:41.119 --> 00:30:45.680 able to do this. You want the Amazon experience to be more fun and 425 00:30:45.759 --> 00:30:49.200 not just you totally. Well, right now we going to Amazon because we 426 00:30:49.279 --> 00:30:53.759 know if we really need something, will find it super fast efficiently and we 427 00:30:53.799 --> 00:30:57.480 trust the system to deliver it to us. But people, but you know, 428 00:30:57.519 --> 00:31:03.720 again, depending on generation and and whatnot, people want to socially engage 429 00:31:03.759 --> 00:31:07.680 in commerce as well online, which they do through other platforms. Amazon needs 430 00:31:07.720 --> 00:31:11.759 to go in that direction and they're going right life selling, you know, 431 00:31:11.839 --> 00:31:15.920 influencer marketing they're going into and obviously they're opening up brand pages for people like 432 00:31:17.000 --> 00:31:21.039 us and bigger brands. So I think you'll see both sides, as I 433 00:31:21.039 --> 00:31:25.680 think you'll see the shop, if I side, offer its scale, logistics 434 00:31:25.680 --> 00:31:29.480 and and the support of what is big, you know, will become more 435 00:31:29.480 --> 00:31:33.039 and more like a marketplace. So the skill economies of aggregating the cont the 436 00:31:33.160 --> 00:31:38.799 small stores into a aggregated platform and as an you'll see Amazon moving more into 437 00:31:38.839 --> 00:31:45.599 allowing brands to become brands and to socially engage with consumers. So at the 438 00:31:45.680 --> 00:31:48.559 end and whether that happens over five years of ten years and how fast and 439 00:31:48.559 --> 00:31:52.720 how efficient, how it I don't know. But I know that we have 440 00:31:52.799 --> 00:31:56.920 great products that have a brand connecting them and we know how to find generally 441 00:31:56.920 --> 00:31:59.759 are you know, will be fine. You will get to them this way, 442 00:31:59.839 --> 00:32:02.720 the other way. We'll get to them in shopping malls or target stores 443 00:32:02.759 --> 00:32:06.680 etc. That that's the that's the mission. No, I mean that's a 444 00:32:06.680 --> 00:32:09.759 really good point and of course amazons thinking about new ways in order to make 445 00:32:09.799 --> 00:32:14.480 that experience a lot more fun and exciting. I mean it rise a little 446 00:32:14.480 --> 00:32:17.640 bit of Ali Baba and tow bow and of how how about introduced live streaming 447 00:32:17.640 --> 00:32:22.079 on it? How about? And that took off and they were very central 448 00:32:22.119 --> 00:32:25.119 direct with be that being part of one of their core strategies, which livestream. 449 00:32:25.119 --> 00:32:30.079 It's a very fun way to engage with content. And of course that 450 00:32:30.319 --> 00:32:34.759 now live streaming in China is a multi billion dollar industry. We haven't seen 451 00:32:34.799 --> 00:32:37.960 that yet over here because we haven't seen Amazon or one of the main commerce 452 00:32:38.000 --> 00:32:42.799 players to actually adopt live streaming, and so I think it's interesting, though, 453 00:32:42.839 --> 00:32:46.279 what you say about how what Amazons thinking about, probably about trying to 454 00:32:46.279 --> 00:32:51.240 make that experience a lot more fun and engaging and actually and having the like 455 00:32:51.359 --> 00:32:54.559 branded, I'm opportunities. Yeah, it's interesting. You know, it's interesting 456 00:32:54.559 --> 00:32:59.720 because it's also considered. We see this already. Consumer behaviors different from culture 457 00:32:59.799 --> 00:33:04.680 to culture. It's clearly, you know, life selling in Southeast Asian Asia. 458 00:33:04.799 --> 00:33:07.839 So my partners at branded, run the company with me, are largely 459 00:33:07.920 --> 00:33:13.000 have grown in Lazada in Southeast Asia, building the market place. They're ultimately 460 00:33:13.079 --> 00:33:16.119 selling to Ali Baba. So they have seen this day one, day in 461 00:33:16.240 --> 00:33:20.039 day out. We haven't seen the same strength. I'm you know, Amazon 462 00:33:20.079 --> 00:33:23.799 actually is launching, has launched product life selling, its live you can see 463 00:33:23.839 --> 00:33:28.400 it on Amazon, but it's very as you said, it's very small and 464 00:33:28.599 --> 00:33:30.640 I'm curious about it. If you think about it. Actually, moralistically, 465 00:33:31.079 --> 00:33:37.519 the US has QBC right, the old of seven cable TV model, where 466 00:33:37.559 --> 00:33:43.839 that is life selling, right, and amazing businesses that there were growth businesses 467 00:33:43.880 --> 00:33:46.279 and through off a ton of cash flow and are still, by the way, 468 00:33:46.400 --> 00:33:52.640 very large billions and billions of dollars of sales and profits. That generation 469 00:33:52.720 --> 00:33:57.559 is shrinking over over all. Right, that's not a long term growth area 470 00:33:57.759 --> 00:34:01.119 and I'm curious to see how the US consumers. Clearly the US consumers a 471 00:34:01.200 --> 00:34:05.440 Gen X, Y and Z, you know, the gender. The next 472 00:34:05.519 --> 00:34:09.599 generations of consumers are morphing to social but they haven't morphed. He had into 473 00:34:09.960 --> 00:34:14.159 live as much as you'd expect based on what you've seen in Asia. But 474 00:34:14.159 --> 00:34:16.880 I think it's it's also early and it may be that the business models have 475 00:34:16.960 --> 00:34:22.639 not really crystallized enough yet. I kind of think the reason why is because, 476 00:34:22.760 --> 00:34:27.079 if you look at how it happened in China, it was actually the 477 00:34:27.079 --> 00:34:30.639 major players that introduced it. It was Ali Baba and and tow a bow 478 00:34:30.639 --> 00:34:32.400 and they made it very much part of their trategy. And so when you 479 00:34:32.440 --> 00:34:37.559 just have that adoptions, is everybody buys on tow bow, then I think 480 00:34:37.599 --> 00:34:40.440 it's a much more easier to adopt as a user. I think that what 481 00:34:40.480 --> 00:34:44.519 we're missing in the states. Personally, I don't know if it's a change 482 00:34:44.599 --> 00:34:46.800 quite like a change of if consumers don't want it here, like I actually 483 00:34:46.800 --> 00:34:50.880 do think that there is a demand for it, but you haven't seen like 484 00:34:50.920 --> 00:34:52.840 an Amazon. I know that you said that you'd some wives streaming, but 485 00:34:53.079 --> 00:34:57.679 it's not like direct center on the Mazime page for live streaming, and so 486 00:34:57.920 --> 00:35:00.360 I'd be curious if that happened, what would then be their response, because 487 00:35:00.360 --> 00:35:04.320 I think that right now, which is very nacent because it's really just startups 488 00:35:04.320 --> 00:35:06.800 that are doing it, it's not really like the actual big tech companies, 489 00:35:06.840 --> 00:35:08.639 and that's how it of alld an Asia. So it means to see what 490 00:35:08.679 --> 00:35:12.280 happens. I think you're right. I think will be, could be that 491 00:35:12.400 --> 00:35:15.719 this, this kind of this ends up being a bigger part of the way 492 00:35:15.760 --> 00:35:21.440 facebook, yeah, ticktock, and others kind of going to e commerce with 493 00:35:21.480 --> 00:35:24.840 the helps of the likes of shopify. Clearly, shopping, you know, 494 00:35:25.079 --> 00:35:31.719 done right, should be very much a fun, many times social experience people 495 00:35:31.760 --> 00:35:36.079 like to validate, and this is why, I guess I again I think 496 00:35:36.079 --> 00:35:38.480 it's early days. If you think about the things that the kind of the 497 00:35:38.519 --> 00:35:44.199 scale players like us are doing, they're still relatively simple. We're just help 498 00:35:44.320 --> 00:35:49.000 grow by launching new products and there's still so much to do right in converting 499 00:35:49.039 --> 00:35:51.719 some of the model to to these new things. Know for sure. I 500 00:35:51.719 --> 00:35:54.559 comply agree, and I mean going back before I let us on this tangent. 501 00:35:54.920 --> 00:35:59.480 What you do lose from not focusing on maybe owning like a shop I 502 00:35:59.519 --> 00:36:02.480 business or Amazon business is because in a shop by business you do actually own 503 00:36:02.599 --> 00:36:06.440 or DDC business, you do own that customer right. You have their email 504 00:36:06.440 --> 00:36:09.199 addresses. You're able to do all email marketing. You're not able to do 505 00:36:09.239 --> 00:36:13.800 that. I'm on Amazon. So that is like a subtle trade off there. 506 00:36:13.840 --> 00:36:16.639 But what the advantage of Amazon, of course, is you have the 507 00:36:16.639 --> 00:36:21.320 search bar, your you have that customer intent, which is words can even 508 00:36:21.320 --> 00:36:24.599 describe how powerful it is. But that MIC doesn't mean that we don't see 509 00:36:24.639 --> 00:36:30.840 a lot of customers in our better brands come back and just going to the 510 00:36:30.880 --> 00:36:34.440 search bar and enter the name of our brand. And if we have to 511 00:36:34.519 --> 00:36:39.199 pay a fee for every time we bid on a search name that is not 512 00:36:39.239 --> 00:36:43.880 our native if we have to pay for our brand name, that's nothing. 513 00:36:44.000 --> 00:36:47.199 You have to pay for a very sought after search word, that's expensive. 514 00:36:47.360 --> 00:36:51.599 So the value, even on the market place and even if we don't know 515 00:36:51.679 --> 00:36:55.280 the name or the details of that customer, because they're invisible to us. 516 00:36:55.280 --> 00:37:00.599 They are Amazon's customer, the fact that they look for us on a repeat 517 00:37:00.639 --> 00:37:04.199 basis to get our products because they like them. They just happen to like 518 00:37:04.239 --> 00:37:07.960 the fulfillment platform of Amazon and and so they enjoy buying on Amazon is still 519 00:37:08.000 --> 00:37:13.880 a very good mode and ultimately allows us to buy for K to create offerings 520 00:37:13.880 --> 00:37:16.519 that are off of Amazon in some cases. So it creates, it creates. 521 00:37:16.519 --> 00:37:20.679 So I don't think it's it's a black and white. You know, 522 00:37:20.760 --> 00:37:23.519 it's a world of an anymity and it's a world of knowing everyone. There's 523 00:37:23.559 --> 00:37:29.440 a there's a bit of a continuum in between. What's what book that Inspirety 524 00:37:29.559 --> 00:37:32.280 Person Lia? One Book that has inspired you professionally? Oh Wow, that's 525 00:37:32.320 --> 00:37:37.239 that's a tough question. There's many of them. I would say that when 526 00:37:37.239 --> 00:37:38.960 I was very young, growing up as a kid in Israel and then then 527 00:37:39.159 --> 00:37:44.039 in s and S, I read a book by Lea a coca and for 528 00:37:44.119 --> 00:37:49.480 the life of me he was the CEO of Chrysler, turned around Chrysler in 529 00:37:49.639 --> 00:37:53.360 the S S and he wrote the book which name escapes me, but it's 530 00:37:53.400 --> 00:37:59.039 the store of his life. It's his biography of how he grew to prominence 531 00:37:59.079 --> 00:38:05.920 at Ford by launching the Mustang and ultimately running and then moving to to Chrysler. 532 00:38:06.119 --> 00:38:08.280 And the inspiration for me, as somebody in my teens at the time, 533 00:38:09.239 --> 00:38:13.840 was really all about American dream, because he talked about this as an 534 00:38:13.840 --> 00:38:19.360 Italian immigrant and a guy who grew up, you know, as an immigrant 535 00:38:19.559 --> 00:38:23.159 from nothing, and that was one of the things that cemented my desire to 536 00:38:23.159 --> 00:38:28.000 actually make the move and immigrate to the US many years ago. So if 537 00:38:28.039 --> 00:38:30.960 I had to point that that's certainly one. At the other one I would 538 00:38:30.960 --> 00:38:35.440 remember that I read was swim with the sharks without being eaten alive, rvy 539 00:38:35.519 --> 00:38:38.760 McKay, completely random book. I read it again at about the same age, 540 00:38:38.760 --> 00:38:44.159 but it was basically all about, you know, marketing, networking, 541 00:38:44.159 --> 00:38:47.199 building a company, working with supply. It was just basic business stuff that, 542 00:38:47.280 --> 00:38:52.920 as a teen in a very kind of far way overseas country, was 543 00:38:52.079 --> 00:38:54.679 kind of home new to me and all these things kind of the level of 544 00:38:54.719 --> 00:38:59.000 business acumen that I saw in the US and the opportunity was quite unique. 545 00:38:59.079 --> 00:39:01.320 so that's old stuff. Off That changed me twenty thirty years ago. In 546 00:39:01.360 --> 00:39:05.760 the recent years I consume a lot. It's hard for me. I just 547 00:39:05.840 --> 00:39:09.519 recently finished the Michael Dell recent book and and I would say there is quite 548 00:39:09.559 --> 00:39:13.199 a lot of inspiration there in terms of, you know, the guy is 549 00:39:13.239 --> 00:39:16.760 obviously built an amazing company and the kind of the most recent book, the 550 00:39:16.800 --> 00:39:21.280 one I just finished, is all about all the things that he went through 551 00:39:21.280 --> 00:39:27.719 in defending his company already as a public company from icon and then through going 552 00:39:27.719 --> 00:39:30.920 through all the kind of the turmoil, basically buying the company back himself on 553 00:39:31.039 --> 00:39:35.159 the public and then and then selling it again to the public. And I 554 00:39:35.199 --> 00:39:37.239 think the kind of the inspiration there, if I had to summarize it, 555 00:39:37.320 --> 00:39:42.360 is, you know, a person who has had massive success and could have 556 00:39:42.400 --> 00:39:49.639 retired many years ago and done other things and as presevered with great values and 557 00:39:49.719 --> 00:39:52.840 with a biggest kind of value of them all in terms of entrepreneurship, which 558 00:39:52.880 --> 00:39:58.440 is just relentless, just never giving up, even when people literally wrote off 559 00:39:58.480 --> 00:40:01.719 though some things just going to go out of buusiness fifteen years so anyways, 560 00:40:01.719 --> 00:40:06.000 it's just one random that jumps to my head as a great, great aspiration, 561 00:40:06.119 --> 00:40:07.679 but I read a lot of them now. It's great. I really 562 00:40:07.760 --> 00:40:12.679 appreciate you sharing those three and I don't think we've actually had anyone mentioned any 563 00:40:12.719 --> 00:40:15.800 of those. So, Michael, very original, very original. Thank you. 564 00:40:15.159 --> 00:40:21.480 What's one piece of advice that you have for founders? Would say, 565 00:40:21.480 --> 00:40:24.199 probably just to build on what I just said about the Dell biography. If 566 00:40:24.280 --> 00:40:29.159 I had to summarize, there's so many things that you need to do to 567 00:40:29.199 --> 00:40:32.000 be successful. Right, you need to to be good at many different things. 568 00:40:32.000 --> 00:40:36.039 Maybe the two things to say is number one. Everybody will tell you 569 00:40:36.079 --> 00:40:38.280 what you're not good at. If you look for that, you'll hear you 570 00:40:38.320 --> 00:40:43.559 know, people will tell you and you should listen to that. But it's 571 00:40:43.639 --> 00:40:47.159 very likely that whatever is are you weaknesses, quote unquote, are never going 572 00:40:47.159 --> 00:40:51.719 to become strengths. What you should do is try and do better with them, 573 00:40:51.760 --> 00:40:57.719 but really lean into actually those things that are unique to you and make 574 00:40:57.800 --> 00:41:01.719 you different. Sometimes they we can be perceived as weaknesses, but many times 575 00:41:01.880 --> 00:41:06.079 they'll be just strengths of yours. Those would be the things. Rather than 576 00:41:06.119 --> 00:41:08.280 focusing on trying to improve, which is a very kind of corporate thing that 577 00:41:08.360 --> 00:41:12.800 we try to do with just focus on your strengths and just lean into the 578 00:41:12.840 --> 00:41:15.480 strength, double down on those and then, as a entrepreneur. Never give 579 00:41:15.599 --> 00:41:21.480 up, never, ever give up. The difference many, many times between 580 00:41:21.480 --> 00:41:24.000 massive success. I had dinner last night with one entrepreneur that tell him the 581 00:41:24.039 --> 00:41:28.880 same thing. You've seen this now many times. The difference. Every company 582 00:41:28.960 --> 00:41:32.679 had a neardeath experience multiple times. Think about apple, Amazon, there it 583 00:41:32.800 --> 00:41:36.639 just any company you want to pick up. There's never going to be a 584 00:41:36.679 --> 00:41:39.920 story where it all the test law was everybody was predicting Tusas out of business. 585 00:41:39.920 --> 00:41:43.719 They had no funding. That like one quarter left of funding or not. 586 00:41:43.880 --> 00:41:49.840 And the difference almost all the time is the tenacity. It is inviting 587 00:41:49.880 --> 00:41:52.800 to give up, just say just white flag and it's just game over. 588 00:41:52.840 --> 00:41:57.960 And it's just not game over and you just need to just continue to fight 589 00:41:58.000 --> 00:42:01.360 and if you continue to fight and lean into your strengths, it's not always, 590 00:42:01.400 --> 00:42:06.920 but in the preponderance of cases you'll be able to come out much, 591 00:42:07.000 --> 00:42:09.639 much stronger than what seems to be the case in any of the those crisis 592 00:42:09.679 --> 00:42:14.159 moments. Yeah, I mean those are all really good points, Michael. 593 00:42:14.159 --> 00:42:15.679 This has been such a pleasure. Thank you so much for your time. 594 00:42:16.000 --> 00:42:20.199 Thank you, it is great to see you and let's keep in touch. 595 00:42:20.199 --> 00:42:22.599 And there you have it. It was such a pleasure time with Michael. 596 00:42:22.639 --> 00:42:24.320 I hope you all enjoyed that as much as I did. If you enjoyed 597 00:42:24.360 --> 00:42:28.280 this episode, I love it if you'd write a review on the apple podcast. 598 00:42:28.559 --> 00:42:30.840 You're also welcome to follow me your host, Mike, on twitter at 599 00:42:30.840 --> 00:42:36.159 Mike Gelb, and also follow for episode announcements at Consumer VC. Thanks for 600 00:42:36.199 --> 00:42:55.760 listening, everyone,