Whalies, Wealth & Wins

It’s a BIG week in the industry of start-ups here in the Big Apple. All the ecommerce/DTC nerds are flocking to my hometown of New York City for the Whalies 🐳 (our version of the Dundies). I imagine it’s going to look something like this:

All jokes aside, it’s gonna be a busy week of dinners, networking, & most importantly, getting sold SAAS. I’m so excited. Hats off to Triple Whale for hosting & getting all the star power to New York City. It’s tough to make ‘work’ events fun & cool, but it seems like they’ve actually been able to do it.

For those going to the Whalies… Here’s my personal itenerary….

Monday night: Founder’s Club table at Rocco’s Sporting Club in Noho for the National Championship.

Tuesday afternoon: Founder’s Club paddle tourny in Williamsburg.

Tuesday night: Founder’s Club dinner & Yankees box seats. Not sure how I’m gonna be at 2 places at once but… we’ll figure it out.

Wednesday: The Whalies.

Thursday: Sleep.

For those curious, the Founder’s Club is an member’s only community of ecommerce/DTC founders. Founded by Chris Meade (Crossnet) & Aaron Spivak (Hush Blankets), the club is an epic crew of people who work hard & play hard. They put on awesome events around the globe. Check them out, I’ve been a member for a while.

Now, let’s get into Part 2 with the king, Alex Lieberman aka the Business Barista. If you missed last weeks interview, you catch up here.

Convo With Alex part 2

Cael: Can you recall if there was a hardest growth threshold that you guys were kind of like stuck at, and what about that stage made it so hard?  

 Alex: I would say that the probably the hardest part was that moment when you realize you have to do things other than what you know how to do, because you've you reached a plateau in growth on your core product. Which means you have to somehow become more than just a one trick pony. And I think doing that is exceptionally difficult. The majority of  successful businesses are really good at just one thing. So, to be good at more than one thing is really, really hard. Our advertisers were telling us that they're not willing to spend much more than they are now with us, no matter how big our newsletters got, because they want to get in front of our audience in different ways. They wanted a 360 degree marketing experience.

 Cael: What were some of those other things?

 Alex: Short form video, social content, YouTube content, podcast etc. It is so exceptionally difficult to be really, really good at other types of content, especially when you have companies that are dedicated to doing just like one of those things really well.

 Cael: I remember at Birddogs when we went from shorts to adding pants, it was really fucking hard. And it took us years to get the product right. We had a lot of failures, but if you really want to, like, break through that glass ceiling, it requires you to make a product that's as good, if not even better, than your MVP.

 Alex: We actually had two products that just did not work for Morning Brew. We tried commerce, because we saw it was working so well for Barstool & is such a significant part of their business. But for us, because I think more of our audience is like a professional audience versus a lifestyle audience, it just didn’t move the needle for us. We also launched education business with courses. It was a fine business, but we realized it just would never scale to be what we needed.

 Cael: So you guys sold the Brew, a few years ago at this point now, and obviously, everyone wants to get to an acquisition. That's the goal of so many startups. The pot of gold at the end of the rainbow. When did you decide it was the right time to sell the company, and from start to finish, how long did that process truly take?

 Alex: So it was an 11 month process. It started in, November of 2019. We sold the business in October 2020. Even though I would say that like the process was maybe prolonged a little bit because it was literally happening as the pandemic was starting, I generally think entrepreneurs should assume that getting a deal done, like actually across the finish line, takes anywhere between 8 to 12 months.

My view of why it was the right time is that it would create a lot of freedom for myself. Both financially & from a career perspective. I think once you get to a certain valuation, you only get marginally more benefit as the dollar prices go up. For example, the first $10 million that someone has in their pocket matters a lot more than the next $10 million, if that makes sense.

 Cael: Totally. Wealth doesn’t scale. So, you still feel today that it was the right decision?

 Alex: I have no regrets about selling the company. But, I think there's a few interesting observations. The actual joy I felt in the moment we sold the company is far less than joy I felt at different points in actually building the Brew, which is obviously the most cliche thing everyone says, like “appreciate the journey, not the outcome,” but it's true.

—

What an awesome convo with Alex. Just an absolute true builder & lover of the game. Can’t thank him enough for joining. Pretty cool for Trust Fun to get him on. Ok, back to it.

How To Get To an Exit Like Alex

I know I’ve been talking about loyalty & Tandym over the last couple weeks… Hopefully I’ve shared some good insights. For those who don’t know, Tandym is a VERY cool new tool in the Shopify ecosystem. Essentially, they’re enabling companies to have their own branded credit cards for customers (think the Nordstrom’s credit card your mom gets every year to get extra cashback while she’s getting you shirts you don’t really like).

Why is this awesome? Well, because your most valuable customers can get rewarded for buying from you AND you can save a TON on processing fees. Normal Shopify fees are about 2.5% & buy now, pay later options can be closer to 4%… with Tandym, you’re looking at less than 1%.

We’re looking to implement it at Mugsy right now. Currently, the Tandym team is crunching the numbers & sending us back our expected savings from adding on our branded payment option. I bet it’s going to be well over 6 figs. Just stacking wins here.

Also, MugsyPay has a real nice ring to it...

They’ve been an incredible partner to work with here at Trust Fun. The company is founded by super cool people who simply just get it. Not gonna be surprised when these guys exit to PayPal for a Gazillion dollars.

Lmk if you’re interested & I’ll make an intro to the founders or you can just sign up for a demo here.

As always, free Trust Fun Baby hats to those who take a demo.

Happy Eclipse day. Hope you all have your glasses.

See you all next week. Rock on.