E128: Building Two Brands: Jocko Fuel and Origin

29:55Is that the impetus for like pulling things apart? Did that happen? Because, I mean, private equity getting involved, if they don't have a piece of Origin and they have a piece of Jocko, that can get – I guess there's questions around incentives and focus and all that stuff, right? So how did that work? Yeah. So I kind of seen the writing on the wall in 2020 that if we changed our strategy from DTC to a multi-channel strategy, omni-channel strategy, I should say. Um, and so we wanted to, we wanted to go and scale and we knew that to get scale. And as we were leaning into this beverage business, that that has to happen in store and shipping, shipping liquid over the mail is expensive.

30:44It's heavy. It freezes when it leaves Maine. And so we knew that, um, yeah, yeah. Which is a whole, I mean, we've had the warehouse flooded. We've had things frozen. And I mean, you can just imagine being located in Maine, like the disasters that we had to overcome over the years. But but we we changed our strategy and we're like, all right, this DTC thing is phenomenal. And it's it's it's nice. It's good margins. It brings cash into the company. um but we want to gain scale with jocko fuel faster and more meaningful and eat that mind share mind share soul share and ultimately market share and so we gotta we gotta run a different play and i and i knew that to run that play we would burn cash and so i started pounding the pavement um 2020 2021 flying around the country meeting with private equity firms I think we had between 70 and 100 meetings.

31:45We had like 20 offers, ended up not doing anything, right? And it came to a point where we had now started, we onboarded Vitamin Shop. We had started our Amazon channel, I guess, of trade. I don't really consider Amazon direct to consumer. I don't know if you guys ever have this internal conversation, but Amazon's Amazon direct to consumer. You own the customer. Amazon you don't own the customer and so it's not direct to consumer it's Amazon direct to consumer and are you doing Amazon third party? we're doing FBA I think and again I'm not involved in that supply chain much but I know we ship from our warehouse in Texas now we ship direct to Amazon what do they call them the distribution centers I think Yeah.

32:42It's just, so, you know, first party is when Amazon cuts you a PO and they actually buy the stuff from you and then it's sold by Amazon. But I do third party and I think it's better to do third party. Mike on the pod who does first party. The reason why I ask is, dude, you started Amazon in 2020 or whatever. Dude, you have to have a great Amazon presence. So whoever runs that for you is an amazing team. They deserve a promotion. Joe Masi Antonio, who was head of sales, now he's president of the company. He loves Amazon. Him and I have butted heads, I mean, so many times on Amazon. He loves Amazon.

33:19He loves the scale. He loves conquesting other brands. He runs these really aggressive strategies. We spend freaking, I don't know,$10,$15 million a year on Amazon. It's a big business for us, Amazon. It's a really big business for us. I think we do, I don't even know, between$70 million and$90 million a year on Amazon. It's like a decent size chunk just on Amazon. Yeah. Yeah. I mean, and you guys just started that. You guys are a beautiful success story. So Pete. I have nothing to do with that. I just, I hired Joe. Yeah. That's all Joe. All right. Well, it makes sense that guy's precedent. Okay.

33:55I'll go back to Matt's point. Matt's talking. How did you manage getting PE in when you have these two separate campaigns? So 2021, you get 20 offers. You do zero deals. You go back to Maine. what are you thinking i'm thinking we're burning cash what the hell are we gonna do because we had started this omni-channel strategy we're now doing beverage beverage is low margin it's penny profit but we see the tremendous opportunity we want to do energy we want to do protein drinks and it started sucking cash and um it started sucking cash fast and so we started we started just burning burning cash getting over our skis a little bit and finally i met with jaco in New York city.

34:37Um, we had to have a face to face. And I was like, if we want to gain scale, then we have to do a deal. Like we have to, it's not like, it's, it's not a question. Like we're, we're, we're at this point where either we got to go backwards and just go back to DCTC, or we got to go all in and we got to lean into this thing. Um, and I was interested in building of building an empire and he was too. And so, so we had a good conversation. Um, a lot of, you know, just sitting there in a hotel room, uh, myself and Joe, uh, and, and Jocko working through it. And, um, and I'm trying to think of what I can and can't say, cause I don't want to break any confidence.

35:22That was what my pause was. Um, and, and, and we ended up doing this deal with good partners out of New York City. And it was kind of serendipitous. You know, Jocko's whole good and you have good partners. And they had owned Supreme and Dave's Killer Bread and La Cologne. And they were very hands-off management style. When they came to Maine, we did the Dog and Pony show. We negotiated a deal. And they bought 35 % of the company at that time. um and and it was a it was a really good deal uh and that was just for jock o 'fiel when i explained to them how the company was intertwined and i said listen i can unwind it uh the you know i can i can unwind it and i can run both companies too like i've i have been and i will i can continue i can continue doing that uh and if it ever becomes too much i'll let you know i fired myself january 1st I'm a good cheer.

36:28You know, and they were awesome. And we've scaled and grown. And we've, you know, we've missed here and there. You know, a plan is just that. It's a plan. You're never going to get it right. It might be a little over. You might be a little under, more under than over, I would say, because we all are ambitious and think we can do more than we can do. And sometimes don't realize things take time. But but but they've been a great partner and they invested in Jocko. Your origin will stay private, I hope, indefinitely forever. I say that and and and that's the plan. You know, never know what the future holds.

37:04But it's been a really good partnership. And then we unwound the shared services. I think the last shared service we have is like the check runs. That's the only thing now that it's a shared service because my wife will never let go of signing the checks. So she physically signs all the checks for Jock of Fuel. It's a kindred spirit for you, Sean. What's that? It's a kindred spirit for Sean. He won't let go of it either. She signs all the checks for Jock of Fuel, and she signs all the checks for Origin. So she'll never let that go. I personally approve all expenses as well. I think it's one of those psychotic things.

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38:57Tell them the operator sent you. Postscript will audit your SMS program for free and show you how to scale fast before Black Friday, Cyber Monday hits. When we talk about list growth, that's what you have to use before, during, and after Black Friday. You want serious gains. You want Postscript. Thank you for supporting the podcast. Thank you for being here. so you know good partners has a good reputation right i think he named some of their killer deals they've been in a couple other brands throughout the years i've talked to him i think the main guy is david good david david audio yeah there you go yeah uh people really like that guy uh so good reputation i think he chose a good firm um did it was it painful making the decision to split the brands because like you know they've been intertwined they've been your baby for so long you have obviously origin first but you've had this long history with you know uh you went through three rebrands you built this thing up or or you just feel like it's the natural place for it to go and there's no emotion in it there's no emotion no i i'm i it's like there's zero there was zero emotion um i don't i don't know how else to explain it it's just like the direction it It needs to go.

40:08And again, I know that Origin needs that too. Origin needs Jocko Fuel to scale. Origin needs Jocko Fuel to become valuable. You know, because the goal is at some point, Origin will never have to use a bank again. You know, and we align with the right partner in the future that will become our own bank. And so that that's that is part of the strategy. I mean, my business partner, Kip says, you know, Pete, if you can pull that out, it'll be the greatest like feat of business ever. And he built Under Armour, right? He was the co-founder. There's some inherent risk there. But and I don't know if it's genius or not.

40:51I just know it's all I knew because I didn't know about business and I just didn't know about banking. And so I was just like, how the frig do we get, you know, get more margin dollars and build great product at the same time and live into the brand and stay true to who we are. And that that was my ADHD way of seeing the pattern on how to make that work, knowing it's going to take a decade to get there and having the patience to get there and making sure we build the right relationships and have the right strategy to get there and build the right team and culture to get there across two brands.

41:24I think the thing that was hard because I do want to I do it was very imperfect like pulling this pulling this apart it was a it was a taffy pull you guys ever seen a taffy pull right yeah so you have origin which is which is very let's say in person it's very everyone's close we're in the factory we're jammed together um you got to be on site to be part of the company we have this rebellious culture we're making stuff in america you know it's it's gritty and raw and resourceful and and real and um and it's a little bit slower too uh because it's manufacturing and and it takes a different part of your your brain and of course i'm jumping from left brain to right brain on origin.

42:24And then I jumbled a Jocko fuel left brain to right brain. And so on a daily basis, I get my dopamine, ADHD dopamine. Um, and it was a superpower, I think up until, up until last year, it kind of became my kryptonite. Um, and then on, on the Jocko fuel, as we're pulling the Taffy apart, now we're bringing in executives from these huge brands, right? Like supply chain experts and, and salespeople. And, um, and And that's a different mindset. And it was very hard for me to build the or to keep the origin culture on the Jocko fuel side. I think that that's one thing that.

43:05I would say it didn't go exactly how I wanted it to go. uh and um and i think that's i think that's okay because we have a we have a we have a good culture the team is more detached it's a remote workforce people work hard they're flying all over the country it's fast it's speedy it's now now now now right and and i'm i'm an i'm a infj so i'm an introvert so i like having that one-on-one connective tissue you know with people I like to, you know, I like that one, like, this is perfect for me to have a conversation. Um, not like, not with people scattered all over the place. And I, I, I can't have an intimate conversation with somebody.

43:51And so, so I, I, I, um, I wasn't able to, as we scaled, you know, to, you know, a hundred million, 125 million, 150 million, you know, like it, it just, it got away from me. you know what I mean? And, and I couldn't grab both things and pull them back. And so it kind of tore me apart. Uh, and, and I recognized it tore me apart last year. Um, this time, exactly a year ago, August. Uh, and I, and I made a phone call to my, my partners and I said, uh, I need to cut myself loose. Uh, you became the taffy. You ended up getting old, man. man yes exactly did you did you fire yourself just from jocko and you still run origin is that the idea yeah and yeah how i guess the you know just talking about separating the company so i have this problem i have two brands largely one shared service team and the idea of like at some point pulling them apart or even now it's like which one internally like which one has more importance at any given moment, right?

45:01And like, how does that affect people? Because like you can, an entrepreneur can be like an optimist and somehow unemotional at the same time, right? But I don't think most people can. Like I look at my team and I think there's questions all the time. It's like, well, which one's the favorite child? Right. You know, like we have two brands. Like, how do you do this? I think in some ways them being separate is great. But like, if you start off together, it's how do you manage the people part? Because like, there's probably people in origin right now that at some point we're packing an order for jocko at some point writing copy for jocko yes working on the packaging like something right and now they're like no yeah focus on the boots dude yeah so how did that work well yeah first of all it's just building a culture of trust you know i like to say i don't i don't need to be liked like that's not my goal as a leader isn't to be liked.

45:55I like to be trusted. And if you're trusted, you're respected. And so if you make a decision that somebody doesn't like, at least they trust you. They trust you to make that decision. So they might not like the decision, but they're trusting you're making the right decision. I think people miss that. I've seen leaders that they're looking to be liked. They want people to like them. They want to have good relationships. But I think having a trusted relationship is way more powerful than having a relationship where we can laugh and chuckle and misery loves company type of situation. So our culture at origin is a culture of, of trust, um, and resourcefulness and honesty and, and sometimes brutal honesty, um, at the same time.

46:39Um, but there's a, there's a mutual respect. And so as I was shifting people around, I could have those honest conversations because of the culture that was built, um, that, you know, Hey, I really need you to go onto the, this brand full time. And I need you to physically move, you know, down the road, uh, into this facility and, and, and people trusted that. Um, and, and so, and so it worked, uh, cause I wasn't looking to be liked or try to sell something to them, you know? And I, and so that was provided through transparency uh also um and to pick to pick what brand to work on i had to get real still and silent um because one brand is a monster that's scaling and i they're both krakens you know what i mean they're both they're both monsters and they need to be fed um and if you don't feed them what they need, they're going to eat you.

47:45And that's a big thing people don't understand. The monster will eat you or it can protect you or it'll take the boat down and everybody down with it. And so you've got to feed it what it needs. And I wasn't feeding it either one what they needed. And as I got still and started looking at where I can be effective, it's really, I had to go back to my Myers-Briggs. Okay, you're an INFJ, you're ADHD, you're better in person, you need some chaos in your life. And then ultimately you're better with stage one and stage two businesses, and you're not as good with stage three businesses. So stage one, tactical ambition, reckless ambition, stage two, tactical ambition, and then stage three, you're actually thinking about, you know, systems processes and all that.

48:30And I know that founders, when a business is a stage three business, sometimes they need to step away. um and i looked at origin i was like origin's a stage two business jaco fuel is a stage three business uh jaco fuel needs a different leader than this guy right here because this guy likes chaos and to create chaos and jaco fuel needs stability and a mind that is organized and disciplined and it was a very easy quick decision i knew where i physically needed to be um and i knew I was ineffective, um, leading a team that was scattered around the country, right? I'm way more effective with my team in person where I can have those intimate conversations.

49:15Uh, and, and so I, I made, you know, I made the call and to my partners and, you know, some silence on the phone and, uh, you know, and Dave Audie, he wasn't totally stoked about it at first, but he, he understood and he helped me find somebody. And we found this guy, Chuck Shupin, who had built La Cologne Coffee from like 30 million to 300. They sold for just under a billion bucks. So brought Chuck on board as the CEO. And, you know, I'm still behind the scenes, obviously, right? I'm behind the scenes, you know, with Chuck still trying to make sure that long-term strategic vision is there, which is something I still feel responsible and I'm still responsible for casting and just that the brand is moving the right direction.

50:01So I still have a touch point on the board of directors and all that stuff. I'm just not in the day-to-day. Okay, because I'm curious, you sold a minority position in this business, but it sounded like you needed the capital to go into the company. So most of it was primary capital? The proceeds, so I needed the capital for both companies, actually. Um, and, and I'll tell you what, what socks is, you know, origin lost a bunch of money last year. Um, as I was focused on Jocko fuel, the first six months hired a team and, um, gave him the checkbook and, um, it just poor, poor leadership on my part.

50:47But, but, uh, but the, the, I think the, the primary proceeds was either maybe 15 or 15 plus million into the business and secondary proceeds were another 10 or 15. I think it was like a$30 million deal. There was definitely a lot of secondary proceeds. It might've been 18 million and 12 million. I'm not exactly sure. So then you, you took your secondary proceeds and you put it into origin is what you did. Dude, you, you pushed the chips right back on the table, Yeah. Yeah. That's the, that was the, that was the purpose, um, um, of it. Right. And that private conversation with Jocko, I was like, it's not just for both brands need this, right.

51:30Cause origin is growing and scaling and it is expensive. And so, so yeah, we, we, we pulled those secondary proceeds through, um, and we pulled a little bit off the, we pulled, we pulled a little bit down. Right. Of course, you know, you want to, you want to do that, but we dumped a bunch back right onto the, we put it right back into origin. And then, um, and like I said, and then last year we lost that, like we bet on black and again, it comes back to me, uh, is why we lost. Uh, and, and, and that was part of the reason I also fired myself from Jocko fuel was because I was being ineffective at that point on origin and I had the gut to gut the team and got the product line and recast the vision and new strategy.

52:22And, um, and it was really hard. Last year was the hardest year of business in my life. 2024, uh, was the first year I ever worked to like truly worked, um, uncomfortably getting out of the chaos that I love. Um, Um, and, and, and it was, it was, it was hard. So, uh, and I don't know how much you guys want to get into that, but yeah, pushed it right back in. It's, it speaks to the kind of like entrepreneur you are too. Like the whole, like just going back to your profile, the fact that last year was harder than standing a barn up in the woods to make things. Yeah. It's just hurting my head. It's like, you'd rather bleed from your fingers than, you know, deal with that.

53:06Yeah. I think Pete thrives in that, man. I do. Dude, it's wild. In the last 90 days, my brands, Pila and Lomi, have doubled our support capacity without adding a single new hire. And that is because we moved to RichPanel. Our CSATs are at an all-time high. I think we're in the 90s now. 50 % of our tickets are fully automated, which means the team can basically handle two times the volume without burning out or adding more people. And with their Trustpilot integration, both brands went from a two-star to a four-star plus, actually, I think four and a half, in like 90 days. and the migration was probably the easiest part.

53:41I was surprised. Rich Panel handled everything, data migration, automation setup, training. We were live in just 14 days. That's insane. And the guarantee you'll cut at least 30 % of your tickets in the first 60 days or you get your money back. Not bad. So if you want to be ready for Black Friday without scrambling to add extra agents, because you know, I'm recording this and Black Friday's around the corner, you should just head to richpanel.com slash demo. Tell them Matt from operators or Sean or anybody, We all use this thing. That's why we're promoting it. Tell them that we sent you and they will take very good care of you.

54:13That's it. Let's get back to the show. We have 20 ,000 plus listeners who would love hearing that, you know, even a guy who has multiple hundred million dollar a year businesses, even a guy who did everything right. He got a massive celebrity on board. He has private equity. He has these great companies that are scaling in new categories. he still had his hardest year in the middle of all that 2024 was hard for me as well pete um what what what was the the x factor that made it you know so so challenging yeah i mean we we ended the year last year at we were right around 200 million i think is where we find the enterprise like the the combined brands um and you should be like woohoo right ooh la la like Like it's, but scaling at all costs, all costs is what I didn't consider.

55:12Yeah. All is an all. All. It starts with a capital A. That's right. Yeah. That's on Origin, and I'll speak specifically to Origin because Jocko Fuel made money last year, was healthy. But the two, part of my deal with my private equity company is they're bifurcated, right? So there's no more pass through of dollars since 2022. So one doesn't feed the other like we used to have it organized. So we wanted to go hard in the paint, you know, drop step dunk style with Origin in 2024. And so I brought on a big team supply chain. We onboarded eight new factories outside of our own factories for overflow shops.

55:57We went and we placed massive purchase orders for textiles with our mills, our knit goods and our woven goods, blanket year-long POs. We hired three planning people for the demand planning and supply planning. And I kind of was like, okay, go, because I didn't know anything about this part of scaling. Um, and so I put that team in place and I was like, all right, go, here's the checkbook, go. And of course we had put cash on the balance sheet from this private equity deal. Um, and we stepped in it August of last year, you know, I, I was so focused on Jocko fuel the beginning of the year when I kind of stepped back into origin, uh, and sat down with my, my director of finance, I'm like, what the f*** is going on?

56:53and he started to unpack it for me and as he unraveled it uh i knew immediately that i had to make some sweeping changes we weren't getting product our products on time right so we're we're three months past the the entry point of the season trying to trying to move cold weather year in summer, trying to move summer goods in fall, right? We got over our skis about 14 million in inventory. Um, we had ordered the wrong SKUs because the demand planning team was new and, and they didn't have enough data points. And so we planned the business wrong and all these were, they're all good people, right?

57:37Like, and I, as a huge learning lesson, I'm so thankful I went through this last year. They're all great people, all world-class employees from massive brands. But they just didn't know, and neither did I, that all this was going to go so wrong. And we ended up at the end of the year losing$6 million, not a paper loss like losing, with tons of inventory in the wrong sizes, wrong SKUs, wrong colors, wrong season. And so I cut myself loose from Jocko Fuel. I knew in August, found Chuck a month later, let him run as a consultant for three months, end of last year, then brought him on board full-time as CEO.

58:27While I stepped back in, gutted the team, had to call friends that we had relationships with, like that we sponsored had to trim all that out cause some chaos didn't do it a hundred percent right um there's going to be some fallout like when you're when you're building something and you got to make changes and that's your job as a founder as a ceo as like the one casting the long-term strategic vision yeah you get all the praise when you win and if you up to that level that's also your fault. And, and so I knew that. And, um, and I was honest and transparent with everybody. Uh, and, um, and I knew there was going to be fallout inside the company too.

59:09And there was, there was a little bit of, of fallout and the strong survived. I needed that. I needed, I needed that. I needed the strong to survive. And I shrunk the room down to four people from like 15. I shrunk it to four people. And I said, this team, this is the team I'm betting on. This is the team that makes or breaks the company. What are we going to do? And we re-engineered the whole thing, cast a new long-term strategic vision, new strategy, grew our margin profile by eight points of margin, grew our revenue by 28 % in H1, over-delivered on plan, changed the whole product matrix. Instead of being sport, jujitsu, hunt, and then lifestyle.

59:54It became casual, smart, casual, American heritage, had three new verticals, hired a new assistant creative director, new art director, decreased all the bull in the back end, leaned out all the lines, focusing on our core competency, dropped five or eight dollars off every pair of jeans we're making, invested in some automation, took some big risks and went all in last year and we course corrected the business in six months. It was supposed to take us 12 months. And that isn't my doing. That's driving behavior to get it done. It's driving the right behavior. It's bringing people inside the operating room, not keeping them on the outside, not saying, I need you to do this.

1:00:39I need you to do this. Hey guys, look at the loss. Look at where it came from. We're doing this together. Okay. You're going to feel everything I feel. Let's fix this business. And last year was like the first year we ever lost the money too, because we've always made money. And so I'm so thankful for that learning experience because I will never repeat paying that amount of tuition ever, ever. Dude, you're, you're, you're a doctor five times over, Pete. You know, I just want to highlight, you know, one of the challenges in owning your own manufacturing is if you get over inventoried, you know, if let's say you're, you know, if you're using third party manufacturers, you just don't order for whatever, right?

1:01:24You wait a season, you wait two seasons, you clear it out. When you have a factory, those people are employed. They get paychecks. They have to make something, right? And that's why owning manufacturing can be, you know, it's a double-edged sword. You get better prices, better costs, better control. but the flip side is if you f*** up on inventory, it compounds on itself, right? Matt, what were you going to say? I was going to say, Pete, are you not more just in time in your origin business? We were. You are now. Yeah, we were. So we were, we got away from that chasing scale at all costs, right?

1:01:56So we were very lean. Then we chased scale. We over-inventoried. I mean, it sucks. it sucks having a nine box your team right and this goes back to i'd rather be i'd rather be respected and trusted than than liked like have you guys ever had the nine boxer team uh i don't know what that means um it's basically a matrix of nine boxes and you you place people on your team within these boxes um is this like a way to who you're keeping and who you're not. It's a depth chart. It's a depth chart. Yeah. Yeah. Who you're keeping and who you're not. Um, yeah, I've done that. Yeah. So like nine boxing, nine boxing people you work with, like, this is the job.

1:02:41That is the job. Like you have to give the monster what it needs to eat. And sometimes it eats people. And if someone's straddling the threshold, that's the first one it's going to eat. Right. So, um, the, the thing that sucks is like, you also, So we also had to decrease our capacity because we didn't hit those delivery timelines. So we had to pull people off the floor that didn't do anything wrong, you know, but you're cutting 30, 40, 50 people loose, you know? So we had the, we had the cut. And I say that we'd cut down to the bone to get back to a baseline. Again, origin is a DTC business only to get back to baseline so that we could have a breath of fresh air to, to go.

1:03:21And that was really, it was really uncomfortable. It was really uncomfortable, but, you know, that was what needed to happen. And it's my job. It's what I have to do. It's what you guys have to do in those types of situations. It's what people never see. They can talk about you. They can be upset with you. They can spread rumors about you. and they cannot understand. And it's not something someone will ever understand unless you have the shared experience. When you have the shared experience, you're like, yeah, I respect that. I respect that. Yeah, Pete, misery loves company, right? Earlier this year, I probably let go of, it's like 12 or 15 people.

1:04:09And it was planning department, inventory department for a very similar reason. I started the year with 12 months of inventory on hand. You know what I mean? It's like, and, you know, people, I think, who don't work in apparel don't understand the importance of getting seasons right. Because, you know, the last thing you're going to be doing is selling beanies in July and swimsuits in December, right? Like, talk about like slow moving skews, right? And, you know, luckily when we're over inventory, no expiration date, sell it all season, whatever. But still, we had a cash crunch, right? We have a bunch of money tied up in inventory that I have to move through.

1:04:47And I still have to place orders because we own part of our factory, right? Yeah, dude. It almost took us out. It almost took Lomi out two and a half years ago. Coming out of COVID, we were just over-inventoried in a product that we then found out had a freaking defect in it from our supply chain. And I'm like, now I'm sitting on$8 million worth of shit I need to fix before I have to sell it. Oh, my gosh. So inventory is the most common thing that nukes consumer goods businesses. It doesn't matter if it's apparel, whatever, man. Like that is the part that I am just, I now have a, it's probably the thing I will lose sleep over.

1:05:24Yes. I'm scared of inventory more than I am of like grizzly bear in the woods. Like that terrifies me. It's so true because like, and honestly, that is one of the blessings of owning manufacturing. Yeah. I have this stellar guy, Andy, he's our SVP of operations, Toyota, lean Toyota guy, used to set up Toyota factories. Been with us since we were doing$2 million a year. And I gave, I said, Andy, go, like, just go fix this and do what you think needs to happen. I said, my initiative is factory consumer just in time. So I need to, I want you to go backwards. I don't want crazy days of supply safety stock but the most important thing is to get our pants business right so designing the pants for manufacturing so we can jam them in the same line at the same time and they can go through the same operations and so he just took that and he ran with it and in three months he had the whole plant re-engineered all the product the pants re-engineered all fit the same way all can go down the line the same way uh and so manufacturing became a superpower for us again and then he's like 30 days of supply on hand we set up a new training program so we can train operators um you know and so we really we really had to focus on the back end and that wasn't time you know talk about time capital and capacity as the three macros you got to feed the monster like protein fats and carbs time capital capacity we didn't have to feed a lot of capital a little bit of capital but it was mostly time.

1:07:04It was mostly time and capacity. Um, and on the front end of the business, that's what we fed capital. So the monster actually needed to eat out of both ends, right? It needed to eat on the factory level, two macros. And on the, on the front end, it needed to eat cash capital. Um, and we were able to, in that square group, I started this octopus group, cracking group that And they all understood the assignment, right? Like Andy operations, Phil marketing, JP e-commerce, Tom finance. If we don't fix this, I didn't say like, we don't fix this. You guys don't have a job. I didn't need to say that.

1:07:43I didn't need to say it. Like we do or we die together and I'm in the room with you. So that pressure was, that was the healthy tension, really healthy tension. I talked about this a little bit on the last podcast it really has worked well, changing the room Jason, what do you like about Saris? You were gone for the past week in Italy were you checking Saris dashboards? I wasn't checking anything in Italy but I will say this, whenever anyone on my team, like growth team or anywhere else sends me data anymore, it's likely coming out of Saris and every once in a while I'll get something from them and it looks really slick.

1:08:22And I'm like, where'd you get? Is that Sarah's like, yeah. And I always feel really good about our investment. I do get a daily email of some metrics out of Sarah's that comes through. But one of the things that I've been thinking about a lot lately is AI. I mean, duh, right? Everyone is. Duh. But like, I finally woke up a few weeks ago. I finally woke up a few weeks ago. I was like, I got to get serious about this. And I was actually talking to the Sarah's guys And they launched a next generation AI-powered stuff in their platform, which I'm excited about. It's Saris IQ. It's invite-only right now.

1:08:57If you mention Operator's Podcast, you can probably get access, hopefully. But the next level of all of this is, first, with AI, you need to have all of your data somewhere. I mean, it's going to be really messy to just drop stuff into different AI platforms. If you have your data in one place and then you can leverage, you can really leverage AI. So the way I've thought about our investment in SaaS analytics was getting all of our data in one place, understanding our customers better, understanding our marketing metrics better. But then being able to lay your AI on top of that is, I think, the really exciting next level here.

1:09:35You brought up bringing in Costco, Amazon, and Shopify. The ability to have all sales channels with the same data is so important. if you're listening to this and you sell on Amazon you know how painful that platform is you have to wait like a couple extra days to pull your reports like the SKUs aren't the same as the rest of your SKUs like the titles are different so like to get actually like clean data to compare it's very manual using XS Analytics they matched all that up for us so like they cleaned all that data so I can actually look at what is the true margin profile of an Amazon sale what's Amazon return rate what's Amazon customer frequency like all the type of data compare it to our dot com and have like a comprehensive overview.

1:10:14And now with their new AI tool, I don't have to look at it. I could just ask it. I could just tell me cool questions. So doing that across our five Shopify stores as well, we have an EU Shopify store. So now I can compare EU ring customer cohorts versus Canadian ring customer cohorts versus Amazon ring customer cohorts. So now we're getting to different functions of my business across different channels, different categories, and actually looking at the margin, the repeat rate, and is it worth investing in these different things? So if your business starts to feel like a spider web and just like keeps going and going and going, it's just like this nonstop proliferation of different channels.

1:10:50Maybe it's time to check something out like Sarah's Analytics. I remember, Sean, at the very beginning. This is a very typical Sean thing. Sean was like, what is this? Why do I need this? Right. And I'm actually really happy that you've you come to understand like how important having a data warehouse is and and what it does for for managing your business, because you are not like a true believer from the beginning. No, I was I was angry when you told me I needed to pay for something new. But Jason was right. He convinced me. He got me on board. I'm using it. So a rare Jason W. you. So thank you, Jason.

1:11:30I'm on Saris Analytics. He's on Saris Analytics, proud sponsor of the Operators Podcast. So if you want a data warehouse and you want an AI-powered data warehouse, tell Saris about the Saris IQ feature and then you crave it. You're demanding you get access to it. All right, guys. Talk to you later. How are you splitting your time now, Pete? So you're no longer the CEO of Jocko, right but you're still obviously like you and jaco are business partners yeah in in both yes so you clearly you have like a care for jaco how much time do you spend there even though you're not technically yeah so um jaco's jaco's now spending more time on jaco fuel especially in the market he's like on all the meetings and i i had asked him like like bro i need help you know Like, I think that's one thing people don't ask for is help.

1:12:25And I just told him straight up, like, I need help, you know. And so he's really stepped in and helped a lot on Jocko Fuel with, especially on the marketing side of stuff. He doesn't get all into the business lingo and metrics and all that stuff. But his daughter, actually, Freya, she's a genius. She works for Jocko Fuel. She's like an analyst. My son just started working for Jocko Fuel. He's handling the Northeast. Oh, cool. Yeah, he just graduated from college. So, of course, I still consider it my baby, right? If you love something, set it free. My connective tissue with the brand is still through, like I was doing packaging design.

1:13:11I still want to give my insights on on bringing product to life, the visual aesthetic of it, the the brand voice. What ground are we going to go claim like long term strategic vision, becoming a beverage company, leaning into protein? Like even the initiatives I set before I left, which was which was beverage or bust protein is power. Like those are the two executive strategies that the team is still running with. And we're going into eating that market share. We have like a two or three share of protein right now. Crazy, dude. That's crazy. It's crazy. Such a hard thing to do, man. Yeah. And that has nothing to do with me, guys.

1:13:52I don't want to, like, I'm not out there selling in. Like, that's the team, right? The team makes this shit happen. Yes, organizing the team, hiring good people to hire good people, having a good culture. um you know i don't want to i don't want to like take anything away from the the team is the one doing this they're living into those strategies but they still got to go execute those strategies you got to have good people to do that as you know but yeah we're crushing we're we're we're eating muscle milks lunch which goes back to that 10 year conversation with jocko if we ever could do something to rectify this, I am all in on that.

1:14:32You're a man with a purpose. Because I remember, I was drinking muscle milks because they tasted so good every single day in high school. And then you end up here and they have lead in them or something and you have to stop. So, dude, insane full circle on that. And then I just wanted to highlight, you made it two years in a PE-owned company or PE-invested company. The average tenure of a CEO in PE comes in is about eight months, right? So yeah, you must have been doing a good job if they were trying to kick you out and they were bummed that you were leaving. So great strategies, man. Hey Pete, I asked Jason this with Hexclad and his deal with Gordon and I'm curious if you can answer this, but what as a percentage, if you look at the success of Jocko or like Jocko Fuel and Origin, how much do you think is Jocko's trust and audience as a percentage?

1:15:26Because I asked this about Gordon Ramsay at Hexplad and Jason was like, oh, it's half. I was going to say 50%. You 50? Yeah. Yeah. Especially early on, like the first five or six years, because that was our marketing arm, right? Like, yeah, we were doing paid advertising and everything, but I don't think you can quantify the value of having a trusted voice out there to tell your story and talk about the product. And so I'd say for like the first, like first five or six years, it was 50%, at least 50%. It's a little bit less now, but that's, that's natural as you gain scale and more brand awareness.

1:16:09um you know it's it's it's less but jaco fuel obviously jaco's volumes yeah i mean his name's on the his name's on the on the bottle so um even more effect uh on that and still and still to this day we're actually need to we need to change that right so we're we knew at some point that that the brand has to transcend the man. And so we're in the process of that. And the way I explain it to the team is like, okay, well, you, if you see this on shelf and someone doesn't ever, they've never seen the brand, they don't know who Jocko is. And you're going to get that as your distribution outpaces your immediate demand of your early adopters.

1:16:52Once that outpacing takes place, the brand has to stand alone. The brand has to be strong. And so the first thing you see is jock, right? Like that's the, that's the first thing you're going to see on the bottle is jock. And so what is, what is a jock? A jock is an athlete, right? So my whole thing is like, this is a brand for the athletic minded, not, not just for people who are, and you could be a former athlete, but people who want to be healthy and athletic endeavor. And so I'm trying to help guide the team as we shift from Jocko podcast to Jocko words that transcend the man to Jocko the brand I've never seen that's very cool because the product's badass the packaging's badass and that's kind of a cool name Jocko uh so that's the I don't think you can actually beat the name the problem with Jocko is nobody googles Jocko for like something else right right like if you put in jocko and google right now it's a dude that your partner's face comes up like 10 times exactly you know so like it's tough to get the brand to be bigger than the name because the name is so unique yes yeah maybe chat gpt fixes that for you yeah but we've got to yeah we've got to transcend the the man right like it's the natural progression is you you you leverage the trust that was built with the man to the trust that was built with the brand and product and now the product and brand outlive that thing, regardless of you're coming in from the opposite end.

1:18:28And so, you know, I love Simon Sinek's, you know, customer journey, kind of the early adopters, et cetera. So we're doing the same thing. Oh, yeah, man. And I think it is genius. I think Jocko is a great name because you want to be a jock. Also, you brought up that Amazon isn't really D2C, And I think that's so true because I knew you guys had protein. I didn't know you guys were in hydration or energy. It's because I buy on Amazon. It's because I, I mean, when I go to your website, I'm just looking for the krill pills and I take. So, uh, right. I think the, the other lines of your business will end up being way bigger because there is convenient stores because there is retail and everything else.

1:19:09Yeah. But this is what, like for people should just learn that Amazon does a disservice, right? Like it limits your focus of the brand to just those keywords. And you can't really tell that full story. Exactly. Yeah. You need to use Amazon for the tool that it is. Yeah. And then, you know, don't mistake it for something else. Yeah. Sales channel. Dude, I got Origin's website pulled up. I'm probably going to spend$1 ,500 today, man. I'm going to get some boots. You know how I discovered Origin? You guys are the only people who make athletic shorts made in America. Really? I didn't realize. Yeah, that I could find at least.

1:19:43So you guys really should own that market. Yeah, no, it's a good. my kip's been calling that out training he's like training training training and he said the same thing but i didn't i didn't realize that yeah i guess i've never thought about that because we do we've been freaking phenomenal training shorts too has the customer changed a lot pete in the you know you start you start off by saying that the overlap between the the two companies was pretty high as jocko fuel has gotten bigger has that customer just evolved away from the origin customer, because the origin customer you described, which is still my favorite thing I've heard in this pod is the professional patriot.

1:20:19Yes. Right. Is the Jocko Fuel customer still heavily the professional patriot or is it now like just anybody, any athletic minded person? It's funny. The way I got comfortable unwinding the brands was through data showing us that only 5 % of consumers were buying jeans, boots and nutritional products. Wow. At the same time. Now those consumers, there might've been another 10 or 15 % that bought origin at one, you know, one part of the year and Jocko fuel, but only 5 % were buying the products. And so, cause Jocko fuels website lived on origin right up until 22 or 23. Right. So, yeah. So it was the same website, right?

1:21:02We had to unwind that whole thing too. Um, and I got comfortable unwinding it because I saw that I saw the data on that. um, as far as that consumer, I think origin is shifting and has continued to shift to this professional Patriot. Um, and he, he likes, you know, he, he, he obviously loves stuff made in America. Um, he loves the mission. Um, he lives in suburbia, which I didn't realize. Uh, it was crazy to me to figure find out this new data um he wears polos uh which i said we'll never make a polo uh we're leaning heavily into making polo so i'd like so yes i'm learning about this consumer a little bit differently and who he is um and and and part of this revelation was was when i got real still, I thought like, I think about like the founders of, you know, like, um, these brands, you know, Kip is unrelatable.

1:22:09He was, he played lacrosse for 10 years. He's built Under Armour and he shoots grizzly bears in the face. Jocko's unrelatable. Like he, he is Captain America. He's the Navy seal of Navy seals. He's a New York times bestselling author. He's a juju black belt. So Tadeco is unrelatable. He immigrated from Brazil, was one of the greatest jujitsu athletes of all time. Right. And I'm unrelatable. I traveled around the world competing in jujitsu and I built a factory in my backyard. So part of part of my understanding of our customer is our customer is not us. So let's stop putting the things that make us happy on them.

1:22:50And that was a big part of what happened last year. is we were trying to put what we wanted on them versus listening to what they want and delighting them. And once that shifted, my mind opened. And once I looked at the data, I still use gut a lot. I use gut to think we need to go this direction to cast the vision, et cetera. But I need data to back that up. It's too risky not to have that. And so full circle, when it comes to the customer, they're changing. The origin customer and the Jocko Fuel customer are definitely different. They're definitely different now. Um, I think Jocko fuel is starting to skew younger, athletic college kids love it.

1:23:33Professional athletes love it. Crossfitters, people looking to be better. Um, they're very interested in that mindset and the health and wellness and the origin customer is very interested in the legacy of America, their personal legacy, upward trajectory, self-actualization you know like they're definitely now they're still crossover for sure but they're starting to grow apart yeah I mean look Jocko could be the Nike of supplements you know what I mean like it's for athletes like I think it can be for so many different people right you know Nike crushes it with Jordan and it crushes it with golf and it crushes it with all these people I think Jocko could do the same thing where I think Origin I mean it's a payroll needs to be, it's more niche.

1:24:21It has to be cooler. It has to resonate with smaller groups. Right. Um, so it's, it's just by nature going to be more exclusion area. I think it is exactly definitely like our Tam is maybe like 31 million people right now for origin, you know, and I don't, I don't know if that's bigger. It feels small, but that's about what it is. And, you know, it's probably honest. It's not a bigger, small, Pete. Yeah. I think it's honest. And you're looking at, you know, in over a hundred grand a year, that consumer, you know, is like more like 20 million. Right. So we're starting to look at our product roadmap and just our positioning because we're, we're like affordable premium.

1:25:00We're not like fashion premium. Like you can still, you know, our t-shirts are 30 bucks, you know, our jeans are 98 bucks, you know, and we're trying to build this good, better, best strategy, um, out right now for, for this new vision. But, um, Well, Pete, I shop almost exclusively Made in America. You guys are the most affordable option, right? So like Imogene and Willie is probably double the price on everything you guys are doing. You know, Buck Mason still probably 50 % above where you are, right? James Purse is 400 % above where you are, right? So I think there's definitely room to scale that upper end, right?

1:25:44Yeah. And that's part of our strategy is going up market on a collection, you know, Horween leather. I want to do a wool pea coat, whaler knit. I want to do salvage jeans. I'm looking to find salvage looms right now. Dude, that'd be so awesome. Yeah. It's like my personal, I'm calling it 20th Maine. I just put it for the trademark, but it's going to be based off of the Battle of Gettysburg. We're going to take a rubbing of the 20th Maine. There's a Maltese cross. That's going to become like the sister brand of origin. So I'm working on that in the background right now, which I'm, I'm, um, kind of given to the world, the process of building a brand through my YouTube channel.

1:26:19Um, cool. Uh, which is, which has been, which has been fun, but, but yeah, it's gotta be careful with things. Yeah, dude. Well, you're a bad man. Everyone's had a hard year at some point, right? Um, you know, 2024 was probably, you know, I know a lot of people who had a horrible 2022. It seems like you were crushing it. But yeah, 2024 was hard. Early part of 2025, we've all made these inventory mistakes. But it's amazing to hear how you've been able to run two successful brands that are totally opposite, right? You've had a weird, weird life, man. Yeah, tell me about it. Yeah, congrats to all the success on Jocka.

1:27:00I'm about to drop$1 ,500 on Origin. I hope the audience does too, right? We have a lot of patriots in the audience. We have a lot of cool people. They would love to shop OriginUSA.com. That's good. Anything else you want to say? No, man, Pete, this is great. It's just, it's very cool to hear you run, how you run your companies and just how thoughtful you are. I think that that's actually, it's refreshing, right? And you're very self-aware. Yeah, and Pete, come back on all the time. We'll get all the other guys monthly, dude. Come be a reoccurring guest. We'll pay you for your time here because you got your wisdom to share.

1:27:31Yeah, yeah, I love it. I'm pretty much an open book. I'd love to continue coming on. If you guys want to have me on, that'd be great. Seems like there's a lot of synergy here. So yeah, man, I said, we're just nerds for how brands get built, man. So like, I think it's, it's very cool to see, did he see you even go off and now you're thinking of a sister brand? I'm like, holy, this guy's maybe worse than I am. So it's great. Doesn't stop cooking. I'll ship you a bunch of cool wallets, Pete, and I'll buy some gear from you. So awesome. Yeah. Thanks for being here, man. Thanks for coming on. Thanks, fellas.

1:28:00Appreciate you. I would talk to you. All right. Thanks for making it all the way to the end of this episode. Wherever you are in the world, it is awesome to have you here. If you do not already subscribe to this show, that is my one ask is please go to whatever platform you are watching or listening to this on. It could be YouTube. It could be Spotify, Apple. I don't care. Just go hit the subscribe button. Please pump our egos up. It helps. And before we go, one more thank you to the sponsors, Fulfill, PostScript, Northbeam, Saris, and Rich Panel. Awesome guys running these companies. We all use them.

1:28:32These are our vendors. That's the only reason they're sponsors of the show. So thanks again to those people. www.jax trabalho tips