Danny Yeung, CEO of IM8 & Prenetics: Operators Titans E009

28:47But technology was really my passion. So at the time, this is 2010, still very early days in technology wise. And then a friend sent me a link to Groupon. And that link was, hey, Groupon is the fastest company to hit a$1 billion revenue. I think they did it. I remember that. Yeah, it's crazy, right? Yeah. And they just had raised$950 million. And I was like, wow, that's quite crazy at the time to hear these numbers, right? Because I think they were the very first big internet company besides like the Googles and blah, blah, blah to raise so much capital. And then I was like, hey, this, and I looked into the business model.

29:25And I was like, hey, this is a great business model, right? And actually, I tested the business model because I sold my dessert chain to my cousin. So I told my cousin, I want to try this Groupon model. I was like, can it really bring in new customers for you? And I tried it on his because I just want to test it. And I was like, within 24 hours, he sold like 500 vouchers. It was amazing for both sides. As a customer, you also get discounts, etc. I was like, oh, wow, great business idea. I was like, I want to do this business idea. Yeah. But I knew I couldn't do it in the U.S. because Groupon was already so big.

30:02At that time, Groupon was already valued at like three, four billion dollars. And there's no way this would be able to compete with him with Groupon in the U.S. So I took that business concept and then say, where can I launch this business idea? Then I moved to Hong Kong just to launch this concept. And I called a company called You Buy, I Buy. So I remember that time I also knew I needed to be very fast And I remember specifically It was February when I got that link And then March 2nd I was already in Hong Kong So a span of 30 days I had just gotten married too So at that time Which now is my ex-wife I was like, hey I need to move to Hong Kong I need to pursue this And I put my whole life savings into this venture, put in$950 ,000 USD along with a few other friends.

31:00And that's basically then started. I moved to Hong Kong March 2nd. We launched a website. And again, I had no e-commerce specific background. It was just a lot through my own Googling. And we launched a website on June 28th, 2010 in Hong Kong and Taiwan. We launched a platform the same day. Like you went to Hong Kong, you start this you buy i buy thing and then somehow you wind up at groupon yeah correct so i mean that was always in the back of my mind hey if we do this well young groupon because i was thinking at that time why they just raised 950 million dollars you know they're not going to be wanting to grow this thing organically right speed is of essence and then so when uh yeah they went international at that time they didn't go international yet right but that was the time when started going international so we launched june 28th and from day one we were always the market leader in the midst of competition right we have 57 competitors in hong kong because if you think about the concept it's actually really simple right you just need a website website can be done for like a thousand bucks whatever right but so the key thing is supply you need to have great deals and yep i think early days wise it was so difficult to get deals and again just i think my cold calling always helps it always comes back right is that then i would you try to call mcdonald's i would try to call yeah basically the big brands uh to come work with a starbucks right for example but of course you know you get rejected they're not going to want to know why do i want to work with you guys right you're you're a small startup so what i did i remember early on was okay starbucks rejected me that's fine uh then i was like you know what why don't i just buy some starbucks vouchers and resell them, pretend it's a deal.

32:44So that's what I did. So I actually bought Starbucks vouchers. Of course, there would have to be a limit. I would buy like 500 Starbucks vouchers at$50 full retail value. And I would resell it at$25 online. But that was a customer acquisition cost to me. Because the consumers-wise, they're like, oh, how do you guys get Starbucks? But of course, they didn't know it wasn't a real deal. right but then yeah so those customer acquisition uh but of course the the voucher says yeah do not resale right so i was thinking hey i'm a small company yeah i love entrepreneurs they're always worried about this legal stuff out of life you know money no starbucks not gonna go after you right then afterwards i just say sorry you know all right so yeah and then so we did that and then we would go to pete's coffee i was like pete's coffee look we worked with starbucks and of course they didn't know what's like a not a good real deal right so the pete's would do a real deal with us so that's early days you just have to kind of you know do a lot of these different things just to get the traction right and I gotta ask did you end up doing a deal with the dessert chain you love so much no it did not actually damn it's all been full circle no it did not yeah so I think it was crazy but then we're able to grow like again crazy fast I remember we had like 1 million monthly USD revenue after six months.

34:13And I remember this 2010, right? So that was, and we only had like maybe four people working, right? And then in six months after Groupon then acquired 51 % stake of the company, right? And then so it was quite crazy. Yeah. What I'm reading is like you, this genetic testing thing, because I think that's the interesting thing. Like everybody's going to know IM8 right now, but that is not where pre-netics starts. Correct. Like you don't start as like consumer subscription. Like you're not doing any of that, right? Yeah. So it causes you to start this company. Like what, tell us about that point in time.

34:54So that point in time, again, I was just wrapping up at a Groupon, right? And then I was actually going to take a big break. And again, you always get itchy. Yeah. And then I was thinking, what do I do next? I had a lot of options. I was investing on the side, basically the money I made. And I was like, hey, what can I do? And I was like, mid-30s. And there was a point where you start thinking about health a little bit more. Because I think when you're in your 20s or even early 30s, health isn't a priority. Because even that you buy by coupon, there are days where literally you're always working.

35:30You don't take your health so seriously. You go out, you drink and all this stuff. So after that, you have a time to reflect. And that's like, and I got really inspired actually by 23andMe. I was like, hey, 23andMe, I was like, I was so fascinated because I, again, I traveled in high school. I didn't much have a school background. I definitely didn't have a science background. But as a normal consumer, I was just so fascinated via saliva swab, you can understand so much about your body. right and at a time wise 23andme was just in the u.s and i was like hey you know basically then i started uh seeing okay maybe there's an actual opportunity to create the 23andme for asia right and then i started talking to your professors genetics uh geneticists experts in this space all right sorry uh and then how prenatics came about was there was already an existing company called Multi-Gene Dynostics Limited and they were like four or five people.

36:33They had the team. They had no business. The revenue was like nothing basically. But they had a really passionate team. I was like, hey, why don't I come over, I'll give you funding. I'll fund it myself and I'll become the CEO of the company. We'll change the brand because we need a new brand etc. And I was like, you know what? I'll give basically $20 million,$2.5 million USD come into this, we change it to pre-edicts. And then Lawrence, the scientific guy, will join. I was like, if this doesn't work in 12 months, I will leave. But you keep the$2.5 million, right? Because I know at that time, I didn't have a background in science, but I gave him an offer he couldn't refuse.

37:16He was probably thinking, hey, this stupid guy, yeah? Stelling coupons online, now wants to do DNA testing. Right? And then so, and I was like, yeah, you know, And I researched a lot, I Googled a lot, read a lot of papers. So then I can like at least intelligently talk to the professors and et cetera. But naturally people thought, you know what, I would do an e-commerce version of 23andMe, but I didn't. And the reason why was I felt at least in Asia, yeah, and I did some early tests, the customer acquisition costs were way too expensive to be a sustainable brand and product. Right? So I took the team, the science piece, that I went B to B to C route and started working with insurance companies first.

38:01So I would talk to Prudential, AIA, some of the biggest insurance companies and have them buy the DNA test and they'll provide it as a value-added service to their insured customers. So we did that for about two to three years. And via these big partnerships, then I was able to utilize that to get to the next round of funding, which was like$20 million USD. you know what's incredible dude like when i read your story and i was thinking about this coming into that so much of your background is b2b selling and just doing deals like i get the groupon thing like there was a consumer element to it so you could connect that to what you're doing today correct but really what you hit on with that is like you still have to go build supply which was just a lot of getting on the phone and and hustling up like the other side of the equation.

38:51So like, even when you get into pre-netics, your early years are just like slugging out B2B deals. It's like, how do I get partnerships? Yeah, correct. Get partnerships, right? And it's creating value, right? So it's basically, and I didn't, my thing is I told my team always say, you know, we can only control so much, but if you're meeting with a potential partner, it's up to us to present the best presentation, the best deck, all of that stuff. We can't control the customer. Ultimately, we'll decide to go with us. Yeah, but I always believe that we should always deliver more value. And eventually, the customer is going to see that.

39:27So I always try to think from the other side's perspective. Let's just say you're doing versions of this. You build up. You've got hundreds of employees. 2020 hits. COVID happens. Yeah. How does that change the business at all? Significantly, right? COVID is one of those moments where it seems like a moment, but it was like a three-year moment for us. And how we got started on that was like, hey, I just had randomly people started texting. My friends say, yeah, do you have any COVID tests? I'm like, we don't do COVID tests. We're a DNA testing company, right? But naturally, that's how people think.

40:04Is that, hey, you do DNA tests? Yeah, same, right? It's the same, but it's very different actually, right? however then i was like yeah after like the third or fourth time that was like why so many people yeah asking me for covid testing that i started looking into a little bit more than it's like at time wise to get a covid test in hong kong you have to pay like four to five hundred dollars usd for a covid test i was like this is insane i talked to the scientific team etc and then the it's like the hospitals are just marketing it up and realistically at that time taking advantage of the consumer because there's no other choice.

40:38And I talked to my son, and he was like, hey, we need to come up with something and we need to come up with something fast. Then basically we came up with an at-home COVID test in basically three weeks' time. We mail it to someone's house, you send it back to us, and then you get your results basically in like two days, right? And so we did that at$100 USD when everyone else was charging$400 or$500, right? We could have easily charged$200, But at the time, honestly, we just did it for the community. We're like, we have the resources. We have the laboratory. We have the team. And every single day, we would sell out of our COVID test.

41:17It was like 200 a day, right? And we would sell out. And then I remember we were the first ones in Hong Kong to do that. And then COVID starts getting very serious, right? And this is like March, April 2020. and then of course Hong Kong being a very conservative city what I mean by that is a lot of stuff started closing and then testing became a big part of the daily regimen so then we started getting calls from the Hong Kong government because they saw us already being able to launch this at-home PCR test in such a vast manner and we had a meeting with them and then actually the first meeting they actually said, ah, we can handle it ourselves.

42:02We don't need your help. Right? And then I was like, that's fine. No worries. Right? Then we continued just doing our, yeah, at-home PCR test until I think it was July. Then all of a sudden the government called us back again and says, ah, then COVID's like getting out of control. Right? They're like, okay, we need help. And they were like, hey, we can do it. Then they're like, okay, first thing we need to do is we need to test all 18 ,000 restaurant workers and 300 ,000 restaurants. And then they're like, oh, can you do this? And then of course, and then they're like, how long do you want to take?

42:41They're like, six weeks. All right, so there we have six weeks, and I was like, of course, we've never done anything like this, right, before that scale, right? And then so, then basically we said, okay, let's do it, then talk to the team, then we're all on board, and then basically that was our first big COVID project where we basically literally, even myself, the first day, I was literally going out to restaurants and passing out saliva kits to the restaurants and then taking it back at nighttime, then going to the labor. It's already literally working 20 hours a day. We literally tested like 300 ,000 restaurants in basically six weeks.

43:22And after that, again, the crazy thing about COVID was because I think my background in technology, so we were always very good with data, right? And scaling that. And we weren't just a regular laboratory. And then so, of course, the home government, you have to work with many laboratories. So at one point, there was like 15 laboratories that were working with, and we were one of 15. Of course, we had more, sure. But then, however, what happened was, you know, at that time, then a lot of the other laboratories, they kept messing up. They kept messing up by having, at scale, false positives and false negatives yeah and at the time you get a false positive you are you're positive you get sent detention in hong kong that's pretty bad literally you can see it was very bad magic you don't have covid but you got false positive and you get sent to detention for like three days and like this hundred square feet you know room right so it's very bad and then the government's like hey all these laborers like you keep messing on they can't scale and so they kept giving back to us so they're like hey can you do this can you do more and more and so we ended up being hong kong's like number one COVID provider.

44:26And at that time, we became a household name in Hong Kong because every time someone entered Hong Kong airport, you had to do a COVID PCR test on arrival. And it was a pre-netics test. Right? So at the height, we're doing 40 ,000 COVID tests every single day. What was, can you give us a sense for revenue at this point? Like, well, I mean, we went from like 2019, 10 million in revenue. and we're just doing the circle DNA test, right? The DNA. Yeah. Yeah, so 21, it was probably like 100. And then, yeah, 100 million. And then 21 is probably 100. 22 was probably like 200. Three years total was 800 million in revenue.

45:15Okay, so during all this, peak COVID, things are going crazy. You choose to go public? There's like... How do you find the time, man? Yeah, so like, you know, to be fair, I think anyone that knows me, they know I'm always working, right? I'm a workaholic. When I'm not working, I'm thinking about work. I'm like strategizing what's the next moves, et cetera, right? So I'm always very, very accessible. And my team knows that too, right? Yeah. Yeah, so I think ultimately thinking strategically, it's like, hey, you know, I always knew COVID would end sometime, even though we were still doing very well.

45:59And I was thinking, hey, you know, I think to take advantage of this from a corporate perspective-wise, right, we needed to go public, given our revenues were very substantial. We're doing like, you know,$250 million a year. So we listed on the NASDAQ in May of 2022, May 18, 2022. too yeah so and that was also and also you had like venture capital like you had investors right so at some point there was like you know you've got to be thinking there's got to be return for shareholders so i guess it kind of makes sense that you would go public but dude may of 22 uh when did everything fall apart again after covid like what was the timing on all this because you must have experienced the hangover of course yeah so yeah i mean i think we stopped doing covid testing, I think, towards the end of 2022, maybe early 2023, right?

46:51So, you know, when we understood, we had a billion-dollar valuation, right? So that's given, you know, how much revenue that we had, et cetera. And then I think, you know, right immediately, of course, hey, you know, basically people say, is this revenue sustainable, right? At the time-wise, yeah, it wasn't sustainable. So that's why basically, you know, our share price had a big drop, right? Starting even right after listing into 23, 24, until even earlier this year, right? Until it started recovering because the reality is we didn't have any new growth story, but we had a very committed team.

47:27I always knew that, hey, we would find something else that would make up for the growth. Yeah, so it was right after everything started plummeting, but we had cash, we had expertise. we had a very, yeah, again, myself being very ambitious, yeah, management team. Yeah. And we, yeah, coincidentally just led me to meeting David Beckham in 2023. Well, Danny, I want to talk about you probably cold calling David Beckham because I know you heard that one in. We got to get there. Yeah, that would be a good story. But unfortunately, I did not cold call David Beckham, yeah?

48:06But let's talk about, it must have been so bittersweet because obviously it must have been so good. You must have felt great COVID going away. You played a big part in saving Hong Kong and all these people's lives. But COVID going away means less testing and it means your revenue collapsing and with that, the share price. So how does that feel when that was going on 23, 24? You obviously, it all worked out. You have an amazing brand now today, but what were those moments like when you're seeing the value of the company go down? Oh, of course, it's tough, right? I think the value to me is more about, you know, you have investors.

48:42And again, you know, even my investors, my friends know, it's like when I'm in something, I'm all in. And they see it, right? They feel it. And again, even the pre-IPO round, this is my close friends and family that invested into the company, right? So I always felt a big sense of responsibility to this group of people. And of course, my team, my employees, and et cetera, that hey you know and to be fair wise yeah given my background etc i could have just you know said hey you know what yeah i'll just you know live a comfortable life right yeah because there's a lot of things you have to do behind the scenes to to make all this stuff work but you know i think yeah i think it's all worth it now uh yeah but it was you know there's definitely difficult moments yeah so you maintain some of your team through all of this like you're going from like riding high get kicked in the gut.

49:39And I'll tell you what we saw. Yeah, well, what really saved us, Matt Sean, is that I think after COVID when we knew that, hey, at the time we had like 2 ,000 to 3 ,000 employees, because we just had a huge team. But one thing I knew, it was like, hey, you know what? If I don't let a majority of these people go, pre-netics is very screwed. Right. So right when I knew that we were not going to do any COVID testing, I was like, you know, I was I didn't do it in phases. I was like, we're going to cut. Yeah. I think, you know, 2000 people to like less than 100. Right. Basically overnight.

50:27Wow. That's that's tough, man. Yeah. It's really tough. Yes. Yeah. And then, yeah, it's tough because I think during the COVID times, you really formed a close relationship with a lot of these people because it was a community piece, right? But at the same time, I knew that was the right decision for the company because I think at the end of the day, I mean, again, just give you an example, right? During the COVID times, there was multiple companies that went public, right? Yeah, Q Health, Laura Health, you know, even to some extent, yeah, 23andMe, et cetera. And these were, at that time, there were two, three, four billion dollar market cap companies.

51:05Yeah, they're all bankrupt today. Right. Literally, they're all bankrupt. Yeah, even though, because the revenues exploded like to a billion dollars annually, whatever, right? But I think one key thing is, I think, yeah, because the headcount is such a big cost, in terms of fixed costs. And so I think for any entrepreneur or any business, I think when you see that, you have to be very realistic and just say, do what's best for the company and the people. And even for the people that we let go, it's better for them because they can move on faster with their lives and careers as well. So I do believe you have to do it fast.

51:47At that time, it may seem very difficult, which it is, but at the end of the day, it's better for everyone involved. Dude, the salamander cuts its tail off to get away from the predator, and it survives another day, right? And that's what you guys had to do. Yeah. Yeah, that's why you're here today. So, okay, so how on earth did the David Beckham thing happen? That's like I want to know. Sean, everybody wants to know. You didn't cold call the guy. Did he cold call you? Is that the wheel that I didn't cold call? You didn't cold call me, right? But it was also, everything is not planned, right? Again, this isn't 23.

52:23Again, we're thinking, what to do? We acquired a few companies in a clinical genomic space. So there was some revenue there. But of course, there was no way it would have made up that significant revenue that we had from COVID. I was actually at dinner with a good friend. Again, given my entrepreneurial background, I've been able to make a lot of good entrepreneurial friends that have been very successful in their own right, right? so I was just through a dinner with my good friend Michelle Lamarine he's the owner and executive chairman of Tattoo Asia which is a big media lifestyle sports company right he knows David Beckham and David Gardner very well and he was just saying to me I was at dinner with Michelle and it's like oh yeah what are you doing in the next few weeks he's like I'm gonna go to London have a meeting dinner scheduled with David Beckham I was like oh very cool and he just asked me right and I was like hey you want to join I'm like I was like okay sure right why not right and then so it was more it wasn't more than that and then two weeks later I flew to London um and we had a conversation and then the idea originally I said what I'm going to tell Dave Beckham about right and then etc and then um yeah so I was like hey I was always thinking hey there's so much that we can do in a consumer space right um and we wanted to do something where in the consumer space, it had a very large TAM, right?

53:50Because it doesn't matter how good your product is, if you don't have a large TAM, it's also limited in terms of scale, right? So in the back of my head, I already was thinking, you know, there's a huge opportunity to potentially create a new brand with utilizing a science-based approach when it comes to supplements. So that's kind of my thinking, like moving and going into this, right? And of course, then when I went to London and met with David, it was quite crazy just thinking about this just like a little bit two years ago. I was kind of sharing with him my background. I think he appreciated my entrepreneurial journey from when I was 15 and everything that I was able to do to survive and get to today.

54:37and just kind of share with him the last 10 years in terms of what we've been building at Prunetics and looking at that from a science first angle, which is the most important because I think for him, I think the most important for him wasn't about, hey, how do I make another few million dollars? Because he never asked one time about the monetary compensation or anything like that because I think for him it was more mainly about impact, right? Can he utilize his platform to impact a greater amount of people given he has hundreds of millions of followers. So I think we got along very well. We started getting to more of the opportunity.

55:12I think he was very intrigued by this because I think, to be fair, he was saying for the last 30 years, so many big companies, so many brands, people have went to him or went to his team to want to start something in the supplement space with his name attached to it. And he's of course them all. But I think timing was most good. I think he really liked what I was telling him. And after a good three to four months after that, we said, hey, let's do this together. In the middle of this three, four months, there was a lot of talk in terms of with his team himself, in terms of what would this product be?

55:53What's the USPs? Because they really need to make sure that there was not going to be any reputational risks from the product side. Because it's something that you ingest, right? Because if something went wrong, no one's going to care who Danny Young is. There's no article there. No one's going to care, right? But it's associated with David Beckham. Everyone's going to write about that, right? So, but if they're a team, Toga, huge, I mean, even today, we meet every single week with their team. And we have done Zealings 2020. Yes, every single week. Well, okay, so what's that? What for? Why? Yeah, so we're distributing weekly meetings, right?

56:33So to be fair, they're contributing a lot from a brand perspective. And even early on, of course, David was very involved in, let's say, in a taste profile. So a lot of the taste profile, he selected the final version of that. Because for him, it was like, hey, yeah, of course, number one, the product needs to be best. We need to hire the best scientists on board. They need to be very credible, et cetera. So that's what we did. And even from the taste perspective, he's like, hey, if it doesn't taste good, And no matter how great it is, no one's going to keep that as a routine. Danny, what I love about you is, this probably comes from your baseball background.

57:10You love swinging for the fences. It's like from furniture to a Groupon competitor to selling the Groupon to then launching the number one name in COVID testing. And now you're in consumer. It's like, I think we're also going to talk about you're also doing a lot of stuff in Bitcoin. So it's like, it's crazy how like you're just, you're always willing to swing. It's like the fastest growing supplement company. Like it's, it's like your, your growth rate's insane. Like there's, yeah, I was right. There's no small swings here. Quick. So I think to be fair, it's like, Hey, when, yeah, when I was talking with David, right?

57:45It's like, what's your ambition for this thing? I was like, Hey, if we do this together, you know, David, this has, we have an opportunity and we want to create the world's biggest supplement brand in the next five years. Yeah. And of course, you probably think I'm crazy, right? But that was my pitch. And then when I went into this, and when we went into this, it was like everything, again, I'm a very hands-on entrepreneur. Everything you see, even the box, the octagon shape, everything, I mean, the color, the scheme, the name, everything you see on the website, I basically proofread or write everything myself to make sure that we're portraying the right message.

58:27right and then the intention was say when we launch it this has to be a big big brand from day one right so that's why we did a lot of stuff that maybe at the time it didn't make sense it's like hey we did clinical trials right we had nsf certification from day one right uh we had custom boxes all right i mean everyone told me like we can't make these octagon shape because it's very difficult from a production perspective and we wanted to do it from day one why does this get off-the-shelf stuff. And then even the manufacturers, like, why don't you just take this off-the-shelf formulation? I'm like, if we do this, it needs to literally be the best product on the market.

59:05And so we took a lot of what wasn't already existing, but as good, how do we make it truly the best? So I think when we launched in last December for our first full month, again, you never know, you know, you can do all of the preparation, but again, never know how well it will sell. Yeah, so the first day, I remember we were like 2 a.m., we pressed the go button. And David also gave a call at 281. We launched the website. And we had like, I think the first day we had maybe like 200, 300 sales. And I was like already very happy, right? Because that means, yeah, everything worked as an intended.

59:41We had, you know, 581 ,000 USD revenue in our first full month, right? And it just, it was okay for our first month launch, right? I think our internal expectations for the first full year revenue was actually$30 million for 2026, which was still decent, right? $30 million for the full year revenue. And crazy to think last month in October, we hit a record of 9 million monthly revenue, right? So we've hit basically 108 million annual recurring revenue in 11 months. And from what I've seen and people I've talked to, and these are industry analysts, experts, et cetera, they've never seen it before.

1:00:29A new supplement brand coming out of the gate to hit 100 known ARR is very rare. Oh yeah, I think you're the fastest nine-figure brand. It has to be. And the coolest thing is you're public. So all the information's available. Yeah, all the information in public. exactly and it's verified by deloitte deloitte's our auditor right so you know yeah there's so much smoke and mirrors and supplements like everything you just said it's like you guys are going above and beyond attaching a big celebrity the reputation risk it means you guys have to deliver good supplements right yes um there's a big scandal right now that like gummy creatine is really big right yeah and um there's not enough there's not there's probably no creatine inside, right?

1:01:12Or something. No, it's because it's sprayed on. It's great. Yeah. If you go to make a gummy, you can't actually put five grams of creatine in a gummy, right? So like, it's just, it's so much of its bunk. So you guys are actually doing the research and it's just so cool to see a public company where you can verify all this data. And yeah, man, I hope, I hope you guys get to a billion, the fastest company to a billion ARR. We'd love to see it. It'd be a big win for the supplement space. We went into this, right? Again, we, not just David, because a lot of people say, oh, you know, David's great and et cetera, right?

1:01:41But then, you know, what his value is, it's just people pay attention, right? But when people pay attention, then again, you have to have a great product, right? Because just a celebrity co-founder, it doesn't work without a great product. So you need to have so many different things done, right? And all the other key thing that we've done right from day one, it was we brought along now a team of 11 scientific advisory board members. and these are doctors, experts, professors. For example, we've got Dr. Don Musilam from the Mayo Clinic, right? And she's an oncologist at the Mayo Clinic, never worked with a supplement brand ever before, but she chose to work with us, right?

1:02:19So Dr. David Katz from Yale, we even got a former chief scientist of NASA as a scientific advisory board member, right? So all of these guys, they actually play a big role in terms of our current formulations and the future formulations. to making sure that our dosages are clinically effective and our sourcing methods, everything about the product is top notch. I have to ask, and I don't know if you can answer it, but if you were to, I know you can't answer it the way I would want to ask it, but let me ask you a different way. Somebody wanted to compete with you guys and develop a product like this.

1:02:59What do you think the, how much does it cost to do it, to be a real competitor in this space, to do it properly. Clinical trials, you're going to hire the scientists. I want people to... And the reason I'm asking, Danny, is not to pry some information out of you. It's actually like, we talk a lot about product development on our show. And I don't think a lot of founders understand what it takes to develop products in this way. The time and the cash. So I'd love you to expand on that. Correct. So I think at a minimum, yeah, you need at least$15,$20 million just to start.

1:03:44And how long do you think it takes to do this to this level? Yeah, easy two years, right? I mean, to be fair, anyone tomorrow can go to a manufacturer and give me your formulation, right? And they'll have a product out in like six weeks, right? And then I think you can likely make some fast money on it. But I think for us-wise, it was never about creating. We're not looking for like an exit, basically, because we're already a public company, right? We're not looking to flip this in a year, two, three years. And again, even the same thing for what David said, we're looking to create this company brand for the next 15, 20 years and beyond.

1:04:27So when we're thinking about it from that perspective, it's a very different mindset in terms of a yeah how how we approach this yeah and i think it's just so cool to see im8 build and grow i mean it's a year old at this point so you could watch the whole story as a public company i encourage everyone to follow along and like check out what they're doing and what they're posting because we all love commerce this is an e-commerce show right i run a hundred million dollar a year brand matt's run a multi-hundred dollar a year brand so it's just really cool to see someone build this in public successfully and see all these pieces as they grow.

1:05:00So it's, it's, it blows me away. All the past, the Groupon, all that cool stuff, the Bitcoin stuff, that's awesome. But at the core of this is a cash flowing asset and the category we all love and care about. So that's hella cool, dude. Yeah. Totally. Thank you so much. Yeah. And Danny, you know, the other thing that I was really excited to talk to you about is, and it's just so cool hearing the story. There are a lot of people who try to take a celebrity or a big name and marry it with a brand that it, we only, you know, it's like, it's a, it's confirmation bias or like recency bias. Like we, we only talk about like the Gordon Ramsey and Hexclad and like these rare winners.

1:05:37It's really nice to see somebody else, like these stories work. Cause I, I know so many words, it's like, they fall flat on their face. Yes. And to do it in the way you did it, where it was like, you got involved in the product development and like very early on. And the whole thing, like, I want to say, like, you did this well and really well thought out. You had the balance sheet to do it, but it was like, it's great to see it this way. Yeah. And we had to take some bold bets too, right? Because the reality was, hey, you know, it would have been a very easy age that we just launched another Greens Powder.

1:06:07Right? Right? I mean, because that was where the market already was, right? So even some of my team members, like, hey, one of the big risks is like, well, will Red's Powder even work? Right? And it's like, yeah, but it's like, hey, we needed to create. I always think we always have to have our own USP or differentiation against what the market is. And so now this becomes very powerful when we're telling that story. Hey, this is a red versus greens and et cetera, et cetera. So we had to take some big bets on the product, the ingredients. I mean, these are all expensive ingredients as well. People are really going to pay for such a premium product.

1:06:42right yeah so we we recently launched our longevity product right and again that was a you know very expensive product it's 149 one-off 119 subscription base and it's the first supplement to targeting the 12 hallmarks of aging to slow it down with aging process with the nmn reservatrol uh etc etc right so these are key ingredients that are scientifically you take it to any scientists they look at ingredients they'll be like oh you guys did it right right so the consumer may not know but my benchmark is always that scientist and that doctor right so and then again you can share so many stories where we had had it's crazy even when i say we had so many doctors recommending this product to their famous clientele where then that clientele then reached out to me or or the company, right?

1:07:35And that's a sign of the product working. And the other crazy thing that we did, which I think was a big brand boost to us, was the addition of Irina Sabalenka. You know, she's, of course, world number one tennis player, right? And how that story unfolded was also very amazing in its own right, is that her performance coach, Jason Stacey, started looking into new supplements early this year, January. And then he took it first, right? Because he has to take everything before Arena takes it, of course. He took it for like two, three weeks. He was like, hey, this is really good stuff. This NSF certified, he felt the difference.

1:08:15He liked the taste. And then he said, hey, you know, Arena, why don't you try this? Yeah, for a bit. She tried it for three months. I'm sure you know at that level where she's in the world number one, they're measuring every day, every single day in terms of performance, right? So she felt better from a recovery perspective, performance, energy, cognitive perspective. And then three months later in April, her team contacted me. So I feel so happy I don't have the cold call. So she was like, Irina loves IMA. How can we partner together? I was like, wow. It was amazing. And then we struck out a long-time partner, Sherbin, crazy.

1:09:00Even this new capital raise, we just announced a$44 million equity offering a few weeks ago. She actually participated in the capital raise. So that shows you how she's thinking about this for the long term and how best she is in this. And it's just, back to Matt's point, I really want the audience to understand that it was a different business in 2022. Yes, very different. as a public company, you've built a best-in-class supplement brand, which is so impossible to do. It would have been so much easier to shut the whole thing down, do this new brand on the side. But you're like, in public, the same company, the same shareholders, we're going to bring this back up and launch this awesome new brand for everybody.

1:09:43So that's cool. Yeah. Correct. Because like I said, we have a responsibility to our shareholders, right? And I know a lot of my friends' shareholders, they still didn't sell even while we were a billion dollars. and now they've seen the trajectory. And again, I honestly believe we're going to be a multi-billion dollar company very, very soon, especially with our trajectory. At the end of every one of these that we do, Danny, we like to do this segment called the Titan 10. It will not take long. It's rapid fire. You've already said you're a numbers and a data guy. This is, we're going to breeze through this.

1:10:16But we like to ask everybody the same questions because so far the fun part of this show has been everybody gives very different answers. And yet we all sell things on the internet. So you would think they should be consistent, but they're not. So I'm going to ask the questions, answer them as fast and like gut feel as you can. Okay. Just try not to overthink them. All right. Okay. You ready? Ready. Okay. So number one, you get to a desert island. You have nothing with you. You get a piece of paper. On that piece of paper, there are three numbers. Those three numbers need to tell you everything you need to know about your business that you care about.

1:10:56What are the three metrics, the three numbers? Yeah. Payback period. Yeah. Lifetime value. Lifetime value to CAC and average order value. Ooh. Okay. You get to bring one book. The rule is it just can't be a book about business. What is the book? Okay. Oh. You know, to be fair. I actually don't read books. Oh, I love it. It's so good. You're Sean's favorite person now. Yeah. I read a lot on the internet, right? I read a lot of research, but I don't actually read books, books per se. All right, because I find it, it takes too long to get to the climax, right? It's like, yeah, you have to read like time for a bunch of pages.

1:11:40It's like, I just want to get into it. So just tell me what I need to know. Danny, most books should be tweets. I agree with you completely, dude. You are on top of me. Yep. it's as I honestly guys I've either gotten older I read less and less books but I read more somehow yes I read a lot I love that um okay what is a contrarian belief about business that most other CEOs and founders would they they just don't agree with you on this I mean I didn't and I'm not I mean I always believe there's always someone else that's on belief is something like you, right? But I think at least for me, you have to take risks in business.

1:12:21Otherwise, you'll just be stagnant. And I always, from my path, is always doing something unconventional. And that's where the biggest rewards will come from. Oh, that's interesting. You think risk is a constant. It's not something that goes away. Yeah, I don't think it goes away, but you have to, depending on where you are, you have to certainly take less and less risks. love it uh what's the single most important word in leadership for you

1:12:53um i mean so many right so i think it'll go back to just you know being very resilient oh okay so then what's the single most important word in business passion yeah you just have to be you know very passionate about what you're building and doing Love it, man. Fun one. Best meal of the day. What's your favorite meal of the day? Tell us why. Yeah, I mean, I mean. And when I'm working, I don't really think about my meals, right? So we already know you work all the time. So you don't. I eat, but it's not something like I think about, right? So I was like, hey. But of course, during the office, let's say I was just, I was at a very simple lunch, right?

1:13:38So I just get my assistant, get me like a pret chicken salad or something like that, right? But unless it's like the weekend, of course, I do like good food. Yeah. So you should have said, does it have a Shan? Yeah. He's the dessert guy. Okay. So back to the business thing. What do you think right now? Like you're, you're 12 months in the growing IM8. You're very in the weeds. We can tell like you're just, you're, you're in the details of things. what do you think the most overrated growth tactic or topic is right now i think probably like optimization yeah because i mean everyone wants to always optimize right and then for me of course optimization is very important but at different stages of the growth company right i think at this stage i think growth is much plays a much bigger role than after fine-tuning every little uh piece of the business right so optimization comes at a certain stage yeah but i think a lot of times people try to over optimize early on when their focus should just be focusing on the key levers for growth you know there's a weird irony in a in a supplement company not liking optimization.

1:14:57Like it's just, you literally sell like health optimization to going to like, that might be overrated when it comes to growing a business. I like that. From a marketing perspective. Yes, look at. No, I actually agree. I think we've talked about it on the show. You're better off not trying to tweak, like you're better off not trying to chase 1 % wins in early stages, right? Like when you're growing, just take bigger swings and go for bigger numbers. That's great advice. Okay, so then what's the most underrated? I think that's one. I actually think you have to be very in the weeds and detailed about every process from product development to customer experience to marketing to end product, et cetera, et cetera, right?

1:15:46So I think a lot of times, especially early on, and to me, you look at it both ways, right? So I'm very in the weeds of things. Yeah. A lot of decisions have to go through me, but I'm able to make a lot of fast decisions. So no one's ever waiting too long of a period. All right. So again, my approach to leadership is more of a founder-led approach rather than leading by committee. All right. So I think when leading by committee, you have to always waste so much time in meetings. right you have to right that's like what do you think what do you think what do you think blah blah blah etc wise right so i think that part at least for me is highly overrated i think if you have a strong entrepreneur ceo that has a lot of experience yeah in many ways they're going to be able to make a much better decision than having a community community-based style love it man uh it has been a consistent theme with i think sean you'd agree within like most of the network and most of the people that we talk to everybody's very in the weeds it actually shocks me uh danny i'll give you a good one we have like a bunch of these chat groups that we're in romans and some of them yeah it's all founders and ceos and they're all running really big companies hundreds of employees you could ask i'm not kidding you could literally post in the iMessage group what does everybody pay pick a freaking sass product and people will respond in seconds,$82 a month.

1:17:13Yeah. Like they won't, they'll just know that every little detail at an alarmingly quick pace. And it just shows you that everybody's in the weeds. So go ahead, John. Oh, I was going to say the winners are in the weeds. Yeah, man. Next to you, Danny. A big winner, my dog. Dude, Danny, this is so good. I really appreciate you coming on, man. It's, uh, Sean's right. We don't get too many public consumer companies that we get to talk to. So like you've got a whole other dynamic that you're trying to manage. and it's just awesome. Yeah, I mean, that's part of the job too, right? So I think this is where it will be very interesting to see because I think, and again, even some people ask me, if we were a private company, right, we'll easily be worth, I would say, five to 800 million or maybe even more given our trajectory, right?

1:18:01Yeah, but again, like you said, Sean, I chose to keep it in this public company because of existing shareholders, right? I want them to do well, right? And I do believe the market will appreciate it once we continue to deliver quarter after quarter after quarter. And once research reports come in, then it'll be too hard to ignore. So, for example, when we did 200 million revenue, then it's like, hey, yeah, eight quarters, right? So I think it'll be too hard to ignore. But I think this will be, again, one of the rare, rare times where you have a consumer public company and people can see the progress on a quarterly basis.

1:18:37and I think it'll be a great, you know, we're significantly undervalued, honestly speaking on that. And this will be a great return for you guys as well as our shareholders in the future. I just want to see good people win, man. And like now that I've met you, I'm like, man, I got to go buy more. Like, I just want to see great people win. Great founders, just like you're an awesome operator. My thought exactly. What I was going to say is, Matt, you said we don't have a lot of public CEOs from consumer companies on here. And it's because it's hard as hell to be a public consumer company right now.

1:19:09It's like, you know, the market has shifted away from consumer, not just D2C, but all consumer brands, right? They want AI and they want nothing but, but that's a pendulum that's going to swing back. Like you have to think in three years or four years or even less, two years, consumer will be hot again. And it's a great time to buy undervalued companies, I think. So they're building something special. I'm a big fan and supporter. and thank you for being one of the Operators Titans. Matt, what else you got to say? Dude, that's it. Danny, you're free to go, man. You've got stuff to do. That's like, I don't know, probably almost noon where you are.

1:19:46Thank you, appreciate it. You guys did amazing research. I love the questions. Yeah, thank you so much.