🧼 LESLIE TESSLER // CEO & FOUNDER @ HANNI

0:00I'm Sam Rose, and this is Commerce is Chaos, the podcast for consumer brand founders who know that building a business is messier than the highlight reel shows. Your supplier just missed their deadline, your top product is out of stock, and your competitors somehow just launched the same thing at half the price. Sound familiar? Every week, we dive into the real problems that keep founders up at night, from inventory disasters to supply chain nightmares, because surviving the chaos is what separates brands that fail from brands that scale. well see you got the hydrate you got 60 ounces of hydration right there i don't know but i'm really trying to get better i feel like if i don't have a big jug like this i don't stay hydrated it's just yeah glasses from the kitchen don't do it for me so i just need to i know what you mean i'm sitting here with your this is my my methodist double-fisted palagrinos and a glass so that i don't look like i'm swigging just be over here yeah Yeah.

0:57When did you start the business, by the way? So we launched in May of 2021. So we turned four this year. I think I probably started working on it in its many forms and it has morphed so many times in 2019, maybe even 2018. We were going to launch in 2020 and then we decided to hold off and we pulled the trigger in 2020. Why'd you do that? Right. There were like a couple of things happening. It felt like, I don't know, not the best time. I had such an odd COVID. We're doing it now, by the way. This is the podcast. Yeah, yeah, yeah. Perfect. I had such an odd COVID experience because at the very beginning, I thought, my gosh, it's, well, it really was the end times.

1:39And we were trying to figure out if everyone was going to need to be furloughed or just how we could keep the lights on. and we anticipated sales going down to zero. And then we were like, you know, selling spatulas into a sourdough bread spike. Right. And that worked.

1:57So crazy. But had I been trying to make a decision at the beginning, I would have waited. I mean, we were a 10-year-old business at that point-ish, nine-year-old business. But yeah, I definitely would have waited. Yeah. And we were kind of going through, I was going through the, you know, do we do it? Is this a sign? You know, when you're an entrepreneur, it's always like, now's not a good time. The universe is trying to tell me something. This is not. So it was really also just a challenge for me to say pause doesn't mean it's off. It just means wait a few months, take a breath, you know, see what's happening and then go for it.

2:32Because I think you're just filled with so much self-doubt in the beginning. Right. That it's easy. I was like, oh, it's easy to find an excuse to be like, oh, no, we're not doing this. We're not doing it. So how do you figure out when to listen to that little voice and when to tell it to shut the F up and just let you build? For me, there's no, it's all, I'm always telling it to shut up because now I think I've learned the difference between my gut intuition, like really kind of raising a red flag and me just being nervous to fail. And I think now I've really gotten over that because I fail every single day.

3:04And once you do it enough, you kind of become desensitized to it. And that's a good thing. Yeah, I'm a good thing. It's helpful in my job, but I think I always listen to my gut because it's never steered me wrong. But I always try to just like shut up the voices in my head that are like, don't do this because or, you know, it's it's my gut always leads me and I try to cancel out the noise. Yeah, I love that. Gut leads you and you cancel out the noise. I think I tend toward that type of entrepreneurial behavior too, where I'm like, okay, data can help me make good decisions when I have it. But so often, especially as you're going from zero to one, as you have, and quite recently, you just don't have data to go on.

3:47So you're like, well, what else? What do you do when there's no data? Yeah. You have to trust yourself. I mean, there's a reason. And I think, especially in the beginning, it's so hard because before you've had external validation, you have to believe that you're the only one who should be doing this business, right? It's something they always, I was always told as I would go into talks with investors, it's like, you need to convince them why you are the only person in the world who should be launching this company, why you are more qualified, not just by what your resume says, but why you are such a unique fit to do this.

4:23And then you go back and it's like, okay, right. Remember all those things. Those are, those are true. We weren't just kind of, you know, So spewing off lip service, there is a reason why you're doing this. And you have to kind of pull back and remember that. Can you bottle that in some way? And I want to talk about your sabbatical, too, because I feel like not enough people give themselves the love and the time for that sort of space and self-reflection that probably comes alongside it. But you decided to category disrupt. And it's a pretty big category. And now you're in like, I'm going to get the number wrong.

4:59but hundreds and hundreds and hundreds of stores. Yep. And of course, like a really big presence with Sephora, which is where I first stumbled on everything. How do you bottle the voice to help give yourself the impetus for like knowing I am the person to do this crazy thing? So I think it's a couple of things. One is you have to find whatever it is outside of your job that centers you and gives you like a moment away from it that makes you kind of helps you reconnect with that gut and the truth that you know. But also for me, it's like hype men. Like my husband is my biggest hype man. And the amount of times that I came home and was like, I'm done.

5:37This makes no sense. Like I'm gonna Google how to file for bankruptcy. Like what, you know, and he's like, take a pause. So I think just having real true support also makes it a lot easier. And I was lucky enough to have that. You know, not yes people, because those don't really help you, but the ones who, you know, there's certain individuals, whether it's friends or family or mentors who kind of, when they say it, you believe it. They cut through where it's not just talk. And I think that's so important. People don't talk about it enough because it wasn't just me. It's not like I'm super powered and I can, everything blocks and I have this super confidence.

6:12No, I have imposter syndrome. I have full of self-doubt and I think most entrepreneurs are, but I have a really strong network of people that I respect and who have helped me through it. I think that's such an

6:28It's extraordinary friendship when you can have someone like that who can hype you up, but can also is so trustworthy that the hype is like calibrated, right? They're like telling you to gun it just the right way. And I think also for those people in my life, they're also the ones who are like, Sam, stop when I really need to be stopped. Right. That's a bad idea. People will call you on your bullshit and it's important. Yeah. One thousand percent. So I think honestly I couldn't have and it's not just him. I've been I have a few kind of people in my inner circle that I really lean on. Without them I don't think I could have done it.

7:05Yeah. It's that important the impact that they've had on success. Yeah. And I think in a way it's their job to how do I define this? like their highest and best job is that they, is that they, or contribution, I should say, is that they believe in you, which doesn't necessarily mean that they believe in every idea you have. And I think that's the difference between like a really good business friend and a really bad business friend is the good business friend always believes in you, but doesn't believe in every idea you have ever. And then they can like help you notch it down. Absolutely it. But they believe in you when you don't believe in yourself.

7:41And those are the moments that you really need to lean on them to kind of pick you up because they're like I said there were a lot of times where I was like does it make sense to keep going it's just like hurdle after hurdle after hurdle and when you're in those moments it's hard to see the light it's hard to you know and then of course one thing happens and then you go on this you know upward trajectory or I guess yeah upward trajectory you know um where things are going really well and then something else will happen and you'll crash back down and I think now I'm four years in so I I get this is the gig guy signed up for.

8:12But even if you're aware of it, and everyone will tell you that it's so hard and all the things, but when you're in it, it's hard to explain how difficult it can seem, insurmountable can seem at times. Yeah. Well, and I think that provides me with a great opportunity to pull out an example from your recent business history, which is that you sort of started with one product and you've, I don't think I should call it a pivot, but you certainly sort of like focused on a different category. Tell us a little bit about what I'm obliquely referring to. yeah yeah how did you how did you decide when we launched in 2021 we were clearly positioned as a shaving brand and i was all in on this idea of and we just moved offices so i don't have any of my toys to show you but um a weighted metal safety razor was really inspired by or rather like horrified by the amount of plastic razors that were ending up in landfills and i thought it was kind of felt you know people are talking about the straw they're talking about the plastic bags They're talking about all of this, but they're forgetting about the razor.

9:12Not only that, it had like amazing, it was amazing from a performance perspective, but it had a lot of issues. And I think education is something I talk about all the time because it's a hurdle when you're innovating, but it's a nice challenge to have. I think it's important to also know when it's too much to overcome. And I think in the case of our razor, because it is, I mean, you will get the smoothest, especially for anyone who is prone to ingrowns, has sensitive skin, reactive skin, all three are me. You will never get a smoother shave, but it is a sharp blade. And it is really hard, even though you can put all over the packaging.

9:52Don't press down. Don't use like a regular razor. Don't apply pressure. We have this whole no pressure lifestyle thing going. But you want to retrain somewhat. It's just muscle memory. To do something that they've been doing since they were 12 or 13 years old is very, very difficult. and it's even more difficult when there's blood involved right it's like if you push down a little too hard or if not too hard if you push down on this kind of razor like you do with your Gillette you will cut yourself and so it wasn't just that so we were kind of going uh in this kind of uphill battle against that and at the same time when we launched we had one product and it was our shave pillow, which is a stick meant for dry shaving.

10:35And people were going gaga over that product. It was like, why didn't anyone think of this before? You know, it was born purely out of me, literally running around my apartment, you know, trying to put on a tank top and, you know, soap and water, like dripping down everything or just like doing it dry and suffering the consequences later. I think we saw a really strong interest from that formulated product design perspective because it fit a real need and it was so innovative. And so obviously, you know, product development takes a long time. So when we launched, we already had quite a few formulated body care products that we were planning on rolling out.

11:11And the second one that we rolled out was Water Bomb, which is a spray. It's basically a lotion replacement, but it feels like water on your skin. And so for all those people who hate the sticky kind of tacky feeling of lotion, having to wait before you can get dressed. It's also a bug spray. We just found out last year by accident. It's a beautiful natural bug repellent. And so as we started rolling out these products and listening to our customers, we already heard the frustrations with the razor, the fact that people loved that it was more sustainable. I'd say 25 % of the people who used it loved it, didn't cut themselves, but we had this big gap.

11:46And at the same time, we're launching all of these new formulated products and people are really gravitating towards them. And so we made a conscious decision, I think, after we launched our third product, which is our hero product, Splash Sav, to completely shift the business. I mean, we don't even we barely talk about shave anymore. Obviously, the people who love the razor are evangelical about the razor. And I love those customers with all of my heart because it's so near and dear to me. But I think the worst thing you can do is be so in love with your idea or so convinced that your idea is it that you don't hear what your customers are saying.

12:22And I'm really glad that didn't happen to us. I'm really glad we stayed close with our customer. And they were asking for it. I mean, slowly but surely, the percentage of our business that was going to formulated body care versus shaving was shifting and shifting. Okay. Well, at a certain point, you have to look at what the people want. and give them more of that. So while it was hard for me, because I had spent, I mean, the development on this razor, it's a beautiful stainless steel. I've been all over the world sourcing materials. I mean, it was two years of intense labor just to get that built.

12:58To be able to kind of not say goodbye, it's still a part of our, but we don't spend any active marketing dollars on it. Because when you're a small business, you have to make decisions. Sure, I would love to be able to love all of my children, my Hanny children. equally. But unfortunately, that's just not that's just not it's not possible. You have to pick some winning horses and place strategic bets on them. And so once we did that, we really saw the business start to start to climb. It builds on the theme that we were talking about earlier, which is that you've got to know when to trust yourself and then no one to listen.

13:31And we were first talking about sort of your closest friends and your my husband's my business partner, too. So for both of us, our husbands, but then, you know, you can kind of abstract that over to the customer relationship. And it's like, you've got to start with something. You don't have any data. You just have to have insane belief and like, you know, the willpower to bring this a product or a couple of products out into the world. And then you start to get data and you've got to listen to your customers. And if they're giving you signal that like they want a different thing from you, you have to have really just sort of like the lack of ego to allow yourself to pivot.

14:05despite the sunk costs, because you're right. I mean, we put that much time and money into something. The amount of working capital that we, because that was, you know, they were so expensive to make. They're not cheap pieces. I mean, it was an expensive pivot. But the sooner we did it, the better. And I think the other thing is like, you just got to go. I don't mean go with what you have, even if in your gut, you don't really believe in it. But like every indication told me that this approach, new approach, also disrupting approach to the shaving category was going to be massive, right? It's like, it hasn't been disrupted in so long.

14:40And this is such a better alternative. Well, you know what, that was what I believed. And to your point, we learned otherwise. And so, yeah, that pivot was such an important turning point in the business. If we hadn't done it, we'd be out of business right now. Absolutely. We would have burned through all of our cash and we wouldn't exist. I think one of the interesting struggles with identifying a category that needs to be disrupted, identifying that you're the right person to do it and then going for it is that, and this has happened to me too, it's not infrequent to have a couple of other pretty spectacular individuals right around the same time realize the same thing.

15:21And so all of a sudden, this legacy industry that's so sleepy and there was no competition for the thing that you're doing, which is to disrupt it. And you're the only one. And then you're like, there's three of me. Isn't it wild how that happens and the timing? It's pretty upsetting. It's pretty crazy. And the same thing happens with body now, right? Like body. So we shifted and body is also, you know, a massive category, but also a kind of sleepy category that hasn't really been disrupted. I mean, it's lotions and creams and scrubs and the same kinds of products. And then all of a sudden there was like a wave of these, you know, new body care brands that were really urging people to take care of the skin on their body the way they took care of the skin on their face.

16:05Yeah. Yeah. I mean, to be honest, that part is exciting to me because when you're in a category that needs disrupting or a relatively new category, I don't want to say the more competition, the better. But the more attention you can bring to the need and the, you know, the category itself, the better. Like, I have some really amazing competitors in this space. But like when they do well, I do well, because for us, it's a question of, you know, premium body care, right? This commoditized category that people have always bought in the grocery store in Target, right, for$9 as a lotion, a$15 lotion, whatever it might be.

16:41will they buy at a more premium price point for X, Y, and Z reasons? And so these other brands that are coming out have come out around the same time. For me, it's amazing because the more people who understand the benefits, and of course, every product offering is different and we pride ourselves on innovation from a product perspective, but the bigger the category grows, the more opportunity there is for us. So I think it's a good thing. I agree. And it's a rising tide of bad dollars and all of the rest, right? Like if there is an educational component to what you're selling, no matter what category you're in, the more people throwing their budget at educating the consumer, the better it will be for everyone.

17:25And I get excited when there's, you know, when I can see like other founders that I really respect or that here's a great signal. Like if you're scared of the competition, of the founders that are in your category that are like hypothetically competing with you, but also part of the tie. Such a good signal. I want to be terrified. Right. And then let's be friends. It's a thousand percent that. It's like admiration and fear. And I'm also super competitive. So all of the things, you know, that drive me. Yeah. But really, more than anything, it's just it's it's great for the category, for this specific category of kind of more premium body care and why it's important to put cleaner, better, more efficient products on your largest organ in your body.

18:11And, you know, most of the square footage is from your neck down. Yeah. Well, and I think the other, I think the other thing to hook onto there, and I don't, I don't know how much, but I'm curious to hear how much you think about this is just the acquisition path for the business, right? Like there's, there's kind of three possible, well, there's four modes. You fail, but we're going to talk about that on this one. We spent plenty of time dying of failure. Then there's you run it profitably indefinitely, right? And sometimes that is diminished as something called a lifestyle business. But really, that's just like a rad profitable business that has customers that are happy.

18:47So there's nothing wrong with that. Then there's acquisition by you or by their strategic acquisitions and you can lead that or one of your competitors can lead that. And then there's, you know, sort of like institutional acquisitions. But in the world of strategic acquisitions, the first and most obvious place to look is like your friendly competition. They're about the same size and about the same stage. And do you spend a lot of time kind of thinking about the exit path for your business? You know, I do and I don't. I feel like it depends on the stage. Do I have a goal in mind? Very clear goal of where I want to get to, what my EBITDA targets are, what my top line targets are?

19:281000%. And am I working towards those every day? Yes. At the same time, I think it's easy. You know, I kind of have to put myself because we're just a small team and I feel like I've just spent so much time fundraising in this journey. And it's obviously been so difficult and such a difficult anyone who's been out fundraising over the last couple of years knows that I feel like it's important to keep that big picture, especially when it comes to profitability, right? It's no longer an option. It's an absolute must and, and running a lean and efficient team. But I also don't want to get, because there's a million things that can happen, you know, who knows, like it can go this way, it can go that way.

20:04And so I also don't want to become so obsessed with it that it takes me away from the day to day and kind of what we're, what we're building for this week, this month, this year. So I think it's twofold, but yes, do I have a very clear plan of where I want to go and how I'm going to get there? You better believe it. You betcha. You bet. Well, and the great thing for an operator like you is that really at the point at which you reach sustainable, profitable growth, any outcome further to that is a great outcome, right? Like if it's sustainable and profitable and growing and you enjoy doing it, there's no reason not to just do that until you, I mean, make another marker for yourself and keep going and keep going.

20:51but also you might be equally satisfied by saying, well, okay, like we can grow through acquisition instead of growing through customer acquisition. Yeah, and so much of it has to do with where you are in life. And that's why I try not to, I have a plan, but who knows what's gonna happen? Who knows, you know, I've got tons of energy and I wanna be doing this, other projects, whatever the case may be, building for a really long time. But so much of it has to do with then where you are in life. And so I also don't want to get too comfortable with the idea that I'm going to get there because then you lose the edge.

21:26Right. For me, it's always like even when I've achieved things and this isn't probably isn't a positive thing, but I've kind of like convinced myself I haven't. And so it's hard for me to celebrate the wins and something I'm actively working on. And I almost convince myself that like you're not going to be able to get it. And that almost challenges me to keep driving because I think it's kind of like the scenario when you think if I win the lottery, my husband and I always do this, right? When we win the lottery, what are we going to spend? Where are we going to buy houses? And, you know, you start thinking of all of this.

21:59And I believe in manifestation and all of the things. But I think it's important not to get too carried away because you know what? This is the thing about being an entrepreneur. It could all implode tomorrow. And I could also be just kind of the brain could close and I could be left with nothing. And you have to be okay with that part, too. Right? can't be driven by the future. I think that's hard. I think you have to be aware of the risks and you have to be doing it for the right reasons because if you're doing it just for a successful acquisition or just to be able to hit this, I mean, it's hard out there and businesses are closing every day and you have to be acutely aware of that.

22:35No, honestly, owning a business is the worst way ever to try to make money. The worst. Right. Like if you want, you're like in, you know, everyone's like, you see the glamorous part and it's amazing, but it's really hard. And you just don't want to take anything for granted. And you don't want to, you can't count on anything because you don't know what's, look what, if I mean, markets crash, great businesses turn sour. The opposite can happen, right? Certain things pick up and you see this unexpected spurs of growth. So I just don't want to ever get too carried away. I want to keep the goal in mind, keep working towards that, but also put ourselves in a position where, you know, we're profitable and we're not dependent on outside capital.

23:17And when these things happen, you know, we can withstand them and we can weather the storm. I think that's the biggest thing for me. I think loving being in the mud of it all is really an important, almost like a, you know, a hard code that's just got to be in there running all of the time. And then there's variables but the hard code is like you could basically be joyful doing the most menial like worst boxes and they're not right i mean because that's or like imagining strategy yeah you said something a couple of minutes ago that i loved uh about kind of creating a plan but also being very flexible and um and it reminded me of sort of like uh what is this like strong opinions It's loosely held.

24:01There's a phrase like that. And I feel that way about planning. Like the point of a plan, in my opinion, is just to have done that work, but not that you actually necessarily have to stick to the plan, which is different than having like an aspiration or a goal, right? But like the how you're going to get there is going to zig and zag so many times. So it's sort of like you've got to have you got to have a place you're going on on a map and you need to think about how to get there you need to like here let's make it a mountaineering metaphor you need to like know the terrain you have to equip yourself right like you have to have extra provisions you should probably travel with a friend and but then the how that you get there will almost certainly change based on the weather and yeah that's a great you know well it's going to be the title of our new book together i also think it's like it's such an important point about making the plan because oftentimes for me, what happens is while I'm making the plan, other things arise.

24:59It's just really sitting down and thinking about it. And in that moment, the plan that I thought I was making totally shifts into something. So before we've even had the chance to have external circumstances affect it, just sitting down and thinking and putting pen to paper, it's super important. Don't just think it in your head, write it down. In that exercise itself, I all, I mean, this happens to me all the time. Something else pops in my head and I, you know, you're going on all these different paths and it's so important and I think I learned like the writing it down is fundamental yeah it's like infinite quizzes there's never actually a test at the end of a semester infinitely quizzing yourself and practicing yes what is your go-to I'm so interested in like the size of your team what everyone does and then your go-to tech stack for pulling it all off And I know because I know that you run Lean and Mean.