Advice Line: What’s Your Value?

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2:37Hello and welcome to the advice line on how I built this lab. I'm Guy Raz. This is the place where we help try to solve your business challenges. Each week, I'm joined by a legendary founder, a former guest on the show who will help me try to help you. And this week, we have a special episode. It's a bit of a mashup, three callers and four former guests. All of these conversations touch on a challenge virtually every founder faces. What's my value proposition and what's the best way to communicate it? By the way, if you're building something and you need advice, give us a call and you just might be the next guest on the show.

3:11Our number is 1-800-433-1298. Leave us a one-minute message that tells us about your business and the issues or questions that you'd like help with. All right, let's get to it. Our first return guest today is Miguel McKelvey, co-founder of WeWork. Miguel has actually come on the show twice before to tell the story of WeWork. First, in 2017, Miguel told us about how the co-working company rose to become one of the most highly valued startups in the world. And then in 2022, he reflected on WeWork's now infamous implosion. And if you want to hear the whole story, we'll link to both episodes in the podcast description.

3:49Anyway, here on the advice line, Miguel and I talked a caller through different approaches to introducing a disruptive new product. Miguel, all right, let's bring our first caller. You ready? All right, I'm ready. Hello, caller. Welcome to the advice line. You're on with Miguel McKelvey. Tell us your name, where you're calling from, and just a little bit about your business. Hi, Guy and Miguel. I'm Megan Downey calling in from Shelburne, Vermont, and I'm the founder of Shiki Wrap. Shiki Wrap is changing gift giving for good with beautiful, reusable, zero waste gift wrap and bags made from sustainable fabrics.

4:22Awesome. Welcome to the show, Megan. So Shiki Wrap is a reusable wrap for gifts. Yep. I love that. I was just in Japan over the Christmas break and it's such a zero way, like there aren't trash cans in Tokyo. Like people don't throw things away. It's very clean. You don't see trash. And yet there's so much stuff that they wrap things in in bags. But then I found out, I asked a Japanese person, we save it. We save the packages and the boxes. We've put them in closets and we reuse them when we give people other gifts, which I thought was super cool. So anyway, that's my story. How did you come up with this idea?

4:59So I was the target market for this. Just hated the guilt after Christmas mornings or birthday parties for my daughter. Just all the microplastic covered waste. I had spent two decades of my career before becoming the reusable gift wrap lady in philanthropy, working to solve really important problems. But this was a problem I looked at and I said we can solve. So I did learn about the Japanese tradition of furoshiki and initially just sought out to purchase some and could not find a product that really had the qualities that I was looking for. So that inspired our first SKU, which was the wraps.

5:37But now we've we also have bags available. Got it. So it started with that stretchy fabric, right, for gift wrapping. Yep. The fabric is derived from certified recycled plastic. So there's actually a lot of greenwashing in the recycled plastic space. So we use certified fabric. And mainly do you sell online? Do you sell in stores? Like where can people buy your products? Yeah. So we've mainly been online selling on our website, Nordstrom.com. We've had a couple of Kickstarter campaigns that have been successful. The bags are what we want to go to retail with because there's no consumer education that has to happen on the shelf.

6:15It just sits nicely right next to the other bags. And we've got price parity with our fabric bags to those, you know, paper bags that usually look bad after a couple of uses. All right. Before we dive in further, what's your challenge and question that you're trying to figure out? Sure. So if you think about how the reusable water bottle was once a niche item before brands like Swell made them ubiquitous, that's exactly what we're trying to drive in the massive gift wrap category. And so retail is definitely one way to do that. But last holiday season, we also found that our reusable gift wrap bar experience where we were actually gift wrapping for people as a service was also pretty powerful, but that's a totally different girl channel.

7:00Do you think that that's a distraction that's sort of experiential marketing? Or is that something that you would recommend that we continue to explore? So you're going in person and you're showing people how to use it, but that's a lot of your time. And, you know, the question is, do you focus on doing that or do you try to just use e-commerce and other traditional retail to bring in more customers? Miguel, I want to bring you in here. Thoughts for Megan? Yeah, first of all, it seems like a very cool product, but I'm a little confused on the mechanism. Like if I buy one of these things, then I give it as a gift.

7:38Then what happens next? Then that person keeps it in their closet and then they use it to give the gift to the next person and I buy another one. I'm a little confused about the mechanics. Yep. So if you're a mom like me, you're going to take that wrap back and reuse it with close friends and family. But yes, for the wraps, people reuse them as head wraps and tote bags and accessories. So they're actually quite versatile outside of just gift wrap. And the bags, as I mentioned, just like you'd give away your paper bag, the price is the same. Got it. I see. And so in the case of the bag, that's something which you're wholesaling to a retailer and then they're using at their point of sale.

8:19Yes. Got it. Okay. I understand. A tote bag is a very common thing already. Is this different than a tote bag in a big way? Yes, it's a high-end fabric gift bag that has a number of qualities. So, for example, they're reversible. You get two designs in one. It has a beautiful gusseted bottom. It has a drawstring enclosure that also doubles as a beautiful handle. So it's a high-end fabric gift bag. It's not a tote bag. Are you finding conversions from the pop-ups? summer, are you finding that they actually, because I would think that that would be a great way to introduce this product to people.

8:57So what is the challenge for you with pop-ups and events? What is the issue? So the bags sell online, and I believe that we will get Velocity in retail. Wraps are also going to be important, but it is sort of like a deeper dive. So to get people to understand them has been the challenge, which is why this reusable gift wrap bar experience is where I saw this magic happening, where people understood what it was, and they were able to see how easy it is when we were wrapping for them. But as you said, it takes a lot of time and effort to show up in person. And even though I love the reusable gift wrap bar, I also know I have a limited amount of time and resources, and we need to stay focused.

9:40I guess my question is, So to me, I would think that that would be a really critical channel because you can see it, touch it. You're describing things here. It's reversible. The material's recycled. It's really special. But it's different when you see that and you feel it and you touch it and you see what it looks like on a gift. And I think, I don't know for sure, but I would be willing to bet the farm that most gifts are purchased around Christmas, right, in the United States at least. And so I would think that if you were to focus your energy on that eight-week period or whatever it is, that it would be worthwhile to just throw it all into that timeframe and then focus on the retail stuff the rest of the year.

10:24Is that something that you have tried or thought about? I think it's great advice. And also I'll just offer that there's great digital content that you can get from this reusable gift wrap bar concept because in the time it takes to just wrap the gift and show that, the person can tell the story of who they're giving the gift to, why did they select this gift? And so it becomes about a story that's much more than just the gift wrap. How far are you from the University of Vermont? That's right down the street. Well, hire some student from the University of Vermont to be your videographer and to film you when you're doing that and turn that into content.

10:57Thank you for validating. I'm definitely on board with this because I'm more of like a wrap with newspaper kind of person because I don't want to create more waste. And so I think the product is great, but I don't think it translates. I'm looking at the website and while it looks nice, I don't fully get it. Like I do feel like touching it, seeing it in real life would be really powerful. So I would imagine whether it's you doing the demo, whether you do even hire a little army of, you know, demo people who go out to multiple stores in the area and, you know, do this wrapping. It seems like that's how you translate something that really is very tactile and needs to be touched to be fully understood.

11:39I wanted to say one other thing. There seems to be a lot of niche people out there who do something where they would really like this would make so much sense. So I was just thinking scrapbookers, for example, I've always heard scrapbookers don't like to put tape on their scrapbooks, you know, and I was like, that's a community of people very niche. But like, if you converted some of them, it would spread like wildfire across the scrapbooking community or something, you know, finding those groups of people who care at a high level. higher level about these kinds of things would be really useful.

12:12And they all talk. You know, communities are the best customers rather than fragmented individuals. So try to find those communities that this really appeals to. Such good advice. Thank you so much. Absolutely. I agree. Tell me, Megan, what is the, you know, aside from the pop-ups and stuff, what is your ultimate hope? Do you want to be in more boutiques in actual stores? The vision is that, I mean, we are like what the reusable water bottle became, right? That we just drive reuse in this massive gift wrap category. So eventually mass retail, but that's not tomorrow. That's likely, you know, a couple of years down the road.

12:52But that's the vision. All right. Well, start with the, do the eight-week pop-up, have the, and then create the content and then roll it out throughout the year and build up the retail side during the rest of the year. And can I bounce one more question off of Miguel? Okay. So our wraps, which we just received a patent for, are made in the USA. The bags are currently cut and sewn offshore. If we were to move towards more vertical integration here in the US to make our own wraps, since we have a patent for those, Miguel, I guess, from an investor's perspective, is that a negative, which I was told it was when we started out, but that may have changed given tariffs?

13:32Yeah, well, I think there's multiple angles to that. Tariffs obviously are adding a lot to your landed costs versus making in the U.S. I think managing fabrication can be a lot of time. And especially for American factories that don't have experience with something like the time it might take to ramp up and produce at high quality, it could be difficult. So I'm all for U.S. manufacturing as much as possible. But for a very small brand, you just have to be careful. So I would love to hear that you're doing it. But at the same time, as an investor for a very small company, it would perhaps scare me a little bit.

14:15So I think you have to figure out when the time is right for that kind of integration. Thank you so much. Megan Downey, the brand is called Shiki Wrap. Good luck. Thanks for calling in. Thank you. All right. Miguel, I mean, listen, this is what it's all about. You went through your thing and, well, many things, and then you take all that and here you are. Yeah. I mean, it's really fun to see these companies that are at that really early stage and they're figuring it out because problem solving is, for me, the most fun part. So to see these people are on the ground, they're trying in the day-to-day to solve these problems, it's inspiring.

15:00We're going to take a quick break, but when we come back, Alexa Hirschfeld, co-founder of Paperless Post, joins me on the advice line. Stay with us. You're listening to a special mashup episode of the advice line on how I built this lab.

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17:50Hey, welcome back to The Advice Line on How I Built This Lab. I'm Guy Raz. And our next return guest is Alexa Hirschfeld, who co-founded Paperless Post with her brother, James. They first came on the show back in 2024, and we will put a link to that episode in the podcast description. You'll hear about how Alexa and James wanted to recreate the beauty of a physical invitation online. And now, almost 20 years later, hundreds of millions of invitations have been sent using paperless post. When Alexa joined me on the advice line, we helped to call her a position, a product that some people were having a hard time understanding.

18:29Alexa, what do you say? Should we take a call? Let's do it. All right, let's bring on our next caller. Welcome to the advice line. You are on with Alexa Hirschfeld of Paperless Post. Please tell us your name, where you're calling from, and a little bit about your business. Hi, Guy. Hi, Alexa. My name is Amanda, and I'm calling from the Madison, Wisconsin area. My business is Wolfsy. Wolfsy creates enrichment tools and experiences that help dogs to feel calmer, more confident and more fulfilled by meeting their real needs, not just entertaining them. Amanda, thanks for calling in. Okay, whoopsie.

19:01So you make products for enrichment for dogs. So explain what you, what do you actually make and sell? So I created a deck of 52 cards. Each card has a different activity for you to do with your dog. The idea is that you would just draw a card and that's a game you'll play to mentally enrich them. So you draw the card and like the card has instructions for what to do with the dog? Yeah. So there's a QR code on the front that'll take you to the website and show a demonstration video of how to play. Otherwise, on the backside, there's a written description. And so give me an example. Like you take a card out, you scan it, and then what do you do?

19:37What does it tell you to do with the dog? So you would just draw a card. And so this one would be tic-tac-toe. This is going to be a more complicated game to play for a lot of dogs because it's going to really test their patience. You're going to set up the game just like you would any tic-tac-toe, but you're going to put out a treat on each of the squares, and you're going to cue your dog to pick a treat. They can only pick one, and you will put an X wherever the treat was that they selected, and then you're going to pick your treat and then mark it with an O, and you go back and forth until whoever wins.

20:13All right. I love it. I mean, of course, I think many dogs just eat all the treats. I'm thinking about my dogs. And one of my dogs would do it. One of my dogs would just eat one of the treats and then I would take one. But the other one would just look at this board and eat everything on it. What is, tell me a little bit about like the sort of the idea behind these games. So mental enrichment is really important for dogs. Most people just think of physical exercise. They don't always think about the mental exercise. But mental enrichment has just so many benefits, like helping to prevent boredom, build confidence, release anxiety, teach problem-solving skills, strengthen bonds with their people, and give them a healthy outlet for their natural instincts of wanting to dig, shred, chew, things that people think is typically naughty behavior, but it's actually really good for them.

21:02I have to imagine you are a dog fanatic. You've got dogs. Yes. I have a husky and a husky mix. Oh, nice. I have a little mixed mutt dog and then a Belgian Malinois. Oh my, so yeah. She's a lot. But she's great, and I love her. She's my best friend. So tell me a little bit about the business. How did you come up with this idea? So like I said, I have huskies. One of them, he loves to work. Taking them for a walk is just not enough. He wants to keep doing things. And so I kind of researched a lot of mental enrichment activities that you can do with your dogs. Because like the typical puzzle toys that you get from the store, you know, a lot of people complain that their dog does it once or twice, and then now they just know it, and it's not challenging them anymore.

21:49And so I kind of looked up a bunch of different ideas of games that I can play just at home with things that I already have lying around my house. But just out of habit, I just kept doing the same thing over and over. And then that wasn't really challenging my dog anymore. So I wanted something that would actually tell me what to do. So I didn't have to sit here, try to think, decide what game to play and what all I need. Got it. All right. Tell me a little bit about how your business is doing. What did you do in sales last year? So I just launched this product in late February of last year and sold about 400 of the decks.

22:26Nice. Okay. And before we dive in further into your business, tell us what your question is for us. So I know this is a really great product. I've had a lot of customers have great success with it. but people are used to seeing like dog puzzle toys or these treat dispensing toys and like you look at that and it's fairly obvious of what it is whereas this yeah it's a deck of cards so people see it and they're like oh my dog's gonna play a card game it's like well no and so i do have to yeah kind of go through and explain everything to them which i do um in person markets once in a while so once i'm talking to those people face to face and being able to show them and then i have all the demo videos playing and they can see the games, then that really helps to sell it.

23:08But online, I feel like I'm struggling with that, even though I try to show a lot of that in social media. Cool. Let's dive in. Alexa, do you have a dog? You're in New York City. Hard to have a dog. My parents have two big black labs and I grew up with a black lab. So I don't have my own, but I have a lot of experience with dogs and I love them. All right. So before we answer the question, any thoughts or questions for Amanda? How are you selling? What is the main channel for selling the product today? So I mainly sell them online. I do have a couple of wholesale accounts, but it's only a couple of them.

23:47I use a lot of social media, but that kind of just gets really tiring. Right. I mean, the question I have is, what is it that the people who have bought and used the product and love it say they love about it in more detail? Because the best way I've found to position your product is to really understand what your most beloved fans see in it and use that as the crux of the positioning, which you're aiming to express to people who don't understand it yet. telling the story from a human perspective with real examples of dog owners and their experience, I think would be a great inhumanizing approach.

24:30Yeah, I think that makes a lot of sense. I see on your website, Amanda, that you've got a few testimonials, but they're not super specific. And I wonder whether you can get a few more, because essentially, if you go to your website, right, it says mental enrichment, you know, say something like, you know, in 10 minutes a day, reduce boredom and anxiety and destructive behavior, right? Like I have a one of my dogs is highly energetic. So this is really interesting to me. And what is my problem? A problem that a lot of people have is they need to get their dog's energy out. And so this is interesting.

25:09And I wonder whether you want to kind of position it like brain games for dogs, right? And hear from people who might say, you know, my dog stopped chewing up the furniture or after playing with this for 10 minutes a day, my dog stopped, you know, pacing around the house. I don't know, whatever, whatever the problem was, because that's really what you're after, right? You're after identify, you've identified a problem. A lot of people have. I think you can just make it a little clearer in how you market and how you position and describe it on your website. Yeah, that makes sense. I, I know that I kind of struggle with making it clear.