The Lessons Behind Scaling, Exiting, and Rebuilding GoSili

0:00These resorts are throwing millions and millions of single-use plastic cups in the trash away. And so we just launched a line specific to hospitality that we hope will tackle that. Canada happened to ban. And so that meant getting rid of all of the plastic baby bottles that were sitting on the shelves in Canada. And we just happened to be one of the only companies at the time that had a solution. Welcome to the DTC Insider Podcast, where online business owners come to find actionable tips and tactics to grow their businesses. Now, here's your host, Brian Roizentl.

0:43Hey, welcome to this episode of the DTC Insider Podcast. I'm Brian Roizentl, your host. And today I'm here with Stacey Fili, the co-founder of GoZili. Hey, Stacey, thanks for being on the show. Hi, thanks for having me. My pleasure. You know, this is, I think we have a lot of special things to talk about today because I interviewed over 200 founders and, you know, CMOs and other directors in e-commerce brands. But this is different because people always or typically talk about what if things go wrong, but they not talk as often about what if things go right and as expected. because there things happen that probably are unexpected.

1:30Like before, like, for example, for you, I know that, correct me if I'm wrong, where, you know, you have like this dream of being on target like many other founders have, you know, but then you did and realized that it wasn't what you envisioned. And then the same, many founders also dream of selling their company someday of that big exit, which you did, but then you bought it back years later. So what happened when you achieved or accomplished your dreams, right? I would love to talk about that in a minute. But before that, why don't you tell the audience more about Go Silly? Sure. So we founded the company almost 20 years ago.

2:15And my partner, Juliana, she's still my partner. We were friends. We were young moms. We were so young in parenthood that we were terrified of anything and everything that we were giving our kids. So we started doing all this research and realized that everything we were giving them to feed them was filled with all these plastic toxic chemicals. And so we really wanted to not do that and find a solution that would be better than plastic. So we started researching different kinds of materials and not even really understanding or knowing that we were about to form a company. But in doing that, we discovered the material silicone and it had all these unique benefits that allowed us to kind of play around with something that would be better than plastic.

2:59So within the blink of an eye, we were making things, we were, you know, building things from scratch. And then the next thing I know, we were calling manufacturers here locally in the States, but then also overseas, and trying to find anyone that would make a line of different things for us out of silicone. In doing that, we also realized very quickly that not only did we want to combat the toxic chemicals found in plastic, we were just abhorrently shocked about the amount of plastics that were sitting on our counters, but also all over the U .S. and the globe, right? And so we were like, oh, gosh, there is a much bigger problem with plastic besides just the toxic chemicals found in it.

3:42But really the single use notion in the kids space, it was a take it and toss it. Like, you know, it didn't matter. You're going to maybe if you lost it, who cares? Because it costs, you know, a buck or something like that. So it was it was pretty evident that we were building this foundational company called Silly Kids at the time that was really meant to deal with that. and then also had a bigger mission and purpose of reducing single-use plastic waste. It makes sense. You know, I'm a father of myself. I have twins. They are six now, a boy and a girl. And yeah, it's what are you doing as an adult, but also what message are you delivering to them?

4:25You know, it's like about, you know, taking care of the planet and all this stuff. So did you have any background on that field whatsoever? No. No, we had no background whatsoever. I mean, we literally, it was like a crash course in business. Like the minute we were like, okay, let's do this. And, you know, we learned a lot along the way. We asked a lot of questions. And sometimes I feel like when you're naive to something, it almost is a benefit, if you will. You can use it to your advantage because you don't know that you can't do it, right? Like I remember telling someone, oh, we contacted this buyer and I can't even remember how, But, you know, we went through like the side door versus the front door, the back doors as opposed to the front door.

5:09We just did things really different because we didn't know any better. But for us, it worked and we didn't have this like overarching view of, oh, well, you can't do that. So we just did whatever we thought we needed to do to make it work. And so that actually really helped. and then we got to a point where we were making all of these glass baby bottles or we were making these silicone sleeves for these glass baby bottles and at the time even flow which is a huge company they're over a century year old they were the only company around that made these glass baby bottles and we wanted to use glass versus plastic we didn't know enough about um i mean you have kids i don't know if you remember twins at some point were like the colicky part and oh you have to like have the venting and the bottle and all these things because you don't want to have gas in our stomachs so we did not want to get into the bottle game but we wanted to figure out how to protect the glass bottles so we developed yes we developed a silicone sleeve to go around them and we had to do all these drop thresholds to patent it and i remember watching my dad i was up at a parking garage those three stories up in los angeles and he was at the bottom And as soon as cars would clear out, I'd be like, okay, you can drop it.

6:22So I dropped these glass bottles that had our sleeves on it off of the roof. And that was our drop test. And so we got up to three stories before the bottle would break. And so that's what we ended up patenting, is the shock absorbers that we had built into our silicone sleeves. And during that time, as we were first starting to kind of like get going, you know, and again, not really knowing much of anything, and figuring them out as we went. I lived in a community, Eagle Rock, Los Angeles, that was all college kids. And so I had pallets and pallets of glass bottles and pallets and pallets of silicone sleeves that were piled up in my backyard.

7:02We paid these college kids in pizza and beer and they assembled a bunch of stuff and it was great. And it worked out well. But in that same timeframe, Canada happened to ban. And so that meant getting rid of all of the plastic baby bottles that were sitting on the shelves in Canada. And we just happened to be one of the only companies at the time that had a solution. So that is what launched our trajectory into a much larger retail chain, if you will, or more mass distribution. And that's kind of what I guess really put us on the map, at least initially. And that actually was pretty scary because, you know, then it was like, oh, what do you mean we have to have a million units ready to go?

7:44in 30 days. And so that is, that was interesting for sure. But again, you just kind of, you have to do it. So you figure it out and you just make it work, you know, whether that's funding the business, whether it was figuring out how to find more college kids to assemble it or find the warehouse to actually like do it properly. We did, we got there, but all learning, that's where we went. And so that was, that was kind of the start of our journey into mass distribution, if you will. That's amazing. Great story. I mean, you said that you paid those students with beer and pizza. Only things are a little bit different these days with the rise of affiliated and creators, especially, you know, Gen Z, you know, probably now they will charge a little bit more.

8:26So things are very, very, very different. You know, it's a long time I've been in business. The other day I interviewed someone that's been in business for 18 years and I said, wow, it's a lot. and even for over yeah almost that you know since 20 yeah almost 20 years yeah almost 20 years so that's a long time so many things have changed right so how did you acquire like did you did you even have any commerce store back then because there was no shopify if i recall correctly meta ads wasn't a thing in 2006 how did you acquire customers like was it all offline so i mean originally it was literally pounding the pavement going and knocking on doors and finding the little boutiques next to us and we always found that those smaller independent stores like they're amazing you know they're our best customers they are the ones that tell our end customers, literally everything about us.

9:29And again, before social media really took off or before you had the affiliates and influencers, those are the ones that were our influencers. They knew everything about our brand. I mean, you could walk into a Walmart, they knew nothing. But if you went to a small independent shop, they knew everything. You know, they knew your best story. They knew why this particular cup was better than the next. And so they were really our biggest advocates initially. And we did have a website. We were on Amazon. I feel like it was still almost even like a bookstore at that point. You know, and we were, again, just trying to figure it all out on our own.

10:05And we got to a point where we had a really basic website and it was great. It was super user friendly, but it wasn't very pretty. And it was like, we know probably was informative more than interactive, right? Yeah, yeah, exactly. And so, but it worked. but then when we decided to like make it really nice and pretty and fancy there was so much coding in the back end that we could never update it ourselves and so we like scratched that we like we ended up throwing away a lot of money to like have it redone to go back to something like super super basic because we could change it when we needed to drop in products or you know change to the seasons or whatever that might be so we learned that that was going to be an issue for us at least along the way.

10:50Starting your business before the e-commerce was a thing, even was an advantage. And I ask because we here in the podcast interview a lot of brands, different sizes, and the most successful ones, whether they are seven, eight, nine figures, or even more, they have a few things in common. And one of them is that they go beyond the storefront, meaning that they don't hide behind the website and say, well, I'm a brand because I either manufacture or source products and upload them to a website. It's way more than that. And you had that naturally because that wasn't around back when you started, right?

11:34So how do you feel about that? Do you feel that you understand something that most founders who started a business in the last four or five years don't? yeah i mean it's we we did start that way we did have to start kind of boots on the ground like that and what we learned along the way very similar to those independent stores we were talking about is that if you don't have a face or personality like a true story behind the brand people can't connect i mean they're not going to connect in the same way you're not going to build that loyalty and that love for a brand right and so still to this day like we'll do some boots on the ground stuff.

12:14We'll go pop into our favorite stores. And, you know, one of the things when COVID hit, we stopped doing a bunch of trade shows. And those were always awesome because you saw all your people, you know, whether it was the big stores, the little stores or your PR people or your just even your competitors. It was a great place to like just talk to people. And so I still feel like that is really, really important, that face-to-face time and building of that relationship. It's so natural. Do you think that trade shows gave you back then or still gave you if you're still doing them? That you miss, like for those founders or decision makers working for brands listening to these that probably don't often go or don't know the value about, you know, those are the value in the trade shows.

13:01What would you tell them? I think there is still serious value there. I'm glad to see that they're coming back. And I think people ultimately want to interact with each other. They're expensive, right? So, you know, when we were first starting, it was like, oh, my God, how are we going to fund this? You know, we found ways. They were weird ways sometimes, but we found a way to get there. And, you know, we were in the beginning building our own booths, which was like a disaster sometimes. You know, it was like things in the back were like put together with glue and, you know, maybe a paperclip.

13:31I don't know. But calendars do what they are starting now. Yeah, it's totally normal. Yeah. And so that's what you do. But I do think there's real value. And I love to see that it is still a thing. And even if you're not going to, say, put up a booth or, you know, be there to buy or whatever, just go walk the shows because you learn a lot from what you see, what you hear. And if you're not out there doing that, you miss all that. So you miss what's in your space. You miss what your competitors are doing. I find them very, very valuable. Yeah. You know, many founders here say that they are successful in the DTC channel, but depending on the vertical, they say, you know, real scale and real growth comes once you unlock or you break through, you know, you, like you break through into retail, like you go into retail.

14:21So you wanted to target, like, I don't know what year was it? Oh man. That would have been. Never. Gosh. 2000 maybe 16 or so 2015 2016 I think what were your expectations with that was that your first you'll start like the big one that was it wasn't our first like big one but it was like the one that we really really wanted and we wanted it for like a decade you know I mean it was like we wanted it like like from the very very beginning like oh we've got to get everything at Target, you know, for, and that was at the time that was where our, where we could meet, you know, the masses and our customer, like they were still shopping at Target.

15:07And when we finally got there, it was like, okay, great check. What's the next one? Like we had all these other future goals that it was like, great, we did it. But then it was like in the past, you know? And, um, so it was, if I look back on it, I had all these like dreams and aspirations and we were going to pop the champagne bottles and maybe we did like a toast, but not anything like I had expected it to, you know, 10 years previously. You just get so, so busy and then on to the next thing and planning for the future. I don't know. It was kind of anti-climatic, if you will. It was a big thing.

15:47Like, did you pull back the products from Target or are you still there? No, we are not still there. And that's a conscious choice, actually. And that kind of ties into what you were mentioning earlier in our journey of our company. What we've found over the years is, again, like our true north, as far as our ideal customer, they are, they're smaller, you know, they're the ones that tell who we are. They're the ones that really drive our message and our messaging. and the larger retail stores, they're good. They're great. They bring in the money, which is important. So there is value to that for sure.

16:27But what we learned along the way is that if you don't have the big budgets to really market within those stores or to support those sales, we got in pretty early and didn't have that. And so we were really scrambling and struggling to one, stay on the shelf, but two, to drive sales into Target. A lot of these large retailers, they put it back on the brands, whether you're big or small, to do their marketing. And so that was a tough lesson to learn. And we lost a lot of money doing that. You get fined like crazy if you miss a ship date or if you don't do a certain sale by this time or something along those lines, you know.

17:09And so we learned a lot of those lessons. And some of them are pretty costly, but, you know, we learned from it and then we didn't do it yet. You got to learn. Yeah, you got to learn somehow. Yeah. So going back to your story, you know, not to those early days specifically, but, you know, you started, let's say, offline, but then at some point, I guess you started the DTC channel right online. So when did that happen, more or less? And what was like the main inflection point in which you said this channel like is working yeah i would say that was probably about seven years ago or so where we were we were in enough like retail stores and small stores big and small to really get an understanding of where our true customer was living and what they were doing and how they were shopping and that's when we were able to and this is like when i feel like i don't even know if we were on shopify at that point, but, you know, we, we still had a site where we could get in and play around and like do things on our own and not have to maybe hire a developer or coder to go with investors.

18:15Right. Um, and social media was just kind of starting to really like pivot and like into a totally different direction. And, um, and that's when we still had the capacity to do it ourselves and tell those stories online and to still connect directly with the customers. you know we would do these like funny little videos sometimes and then we would post them to our social media and it was like a just a video chat with like a customer that would call in about you know a cup that they had you know and um so we were those what's that you recorded um those calls in video and you posted those on instagram let's say or facebook yeah so we would ask sometimes we would have like a reoccurring customer we would ask it's like hey do you mind doing a quick little interview with us.

19:02We're going to ask you some questions about the company. We're going to ask you what you think about this item that you just ordered and tell us your story. And so it kind of created this real dialogue with people that we knew followed us and loved us. And that just spun off. And it was so fun. It was so fun because you're talking directly to the people that you're selling your things to. But we also got a lot of ideas on next protocol launches. When we started off as silly kids, we had tons of parents that were like, well, where's my adult cup? Where's my coffee cup made of the same thing? And so, so that's what launched Go Silly.

19:40And then Silly Kids became a sub-brand of Go Silly. And, and that came just from like those direct conversations of our customers and listening to them. And a lot of that came from online and just, you know, really being and trying to have the best customer service as humanly possible. That was like my big beef, if you will. Like if you did not have good customer service, it drove me absolutely bonkers. And so it was a goal and a mission of mine to make sure that whatever we were doing, we were going to be the best. And we were going to have incredible customer service. And we were going to, we were going to become your best friend.

20:16And that's what we tried to do. It's amazing because, you know, more I talk to founders and more I realize something that, you know, of course, the success isn't the simple stuff. You know, it's like some books say, you know, it's like extraordinary results doesn't come from extraordinary efforts. It comes from ordinary efforts in an extraordinary period of time. Right. So it's the reps they put in every single day. So it's the little stuff. But even more, it's showing your customer, like really caring about your customers, not doing that for social, like caring about your customers, caring about being the best in what you do, delivering the best product, best customer experience.

20:57calling your customers whenever you can, how many you can, but I can't stress enough. And I talk about like this a lot, like a broken record, but it's because it's important. Like founders, like many, many operators or founders are chasing the next big thing, the perfect attribution, perfect whatever. And they don't have any data about their customers. They don't collect that data. And even if they do, they don't analyze, you know, the, I don't know, post-purchase surveys, reviews, they don't call their customers. So they don't know what they want and how they want it. They don't have a community and their community will tell them what they want to see next, as you said before.

21:32So, yeah. I know that everything is an effort and everything takes time. Building a community needs, you know, maintenance and to administrate that community and keep that engaged and alive. But it's worth it because those brands with the mission and the vision and those that go further and put that mission and vision into action are the ones that at least I see thriving the most. Yeah, I would agree. I mean, it's, you know, we had days early on where it was like, felt like a sinking ship, right? And it was like, do or die. And over our dead bodies was this not going to work. I had to, you know, and you just, and you did, you figured out how and why, and there was a much bigger cause and purpose behind that.

22:20And to its core, the mission of what we really were tackling and the reason we formed the company just drove us, you know. And so that was the greater good of what we were doing, you know, so it had to work. And we found that we had a solid community that supported that. And so that, if, you know, I went away tomorrow and that's what my claim to fame is, I'm happy. That's great. So we already talked about what happened with Target. But then I would like to talk about the exit. You know, it's something that, again, some brands probably don't aspire to doing, but then they do and some don't. But some, they really build the company with that intention in mind.

23:08Like they want the exit, that juicy exit, dreamy exit. You had that exit. Could you please tell us more about that first before talking about the other part? All right. So, let's see. We did have investors and, you know, we had an obligation to our investors. And we got to a point where, you know, we were doing awesome and we were, you know, we were doubling every year and it was amazing. we were on this really awesome trajectory. And what we wanted to see for the brand was, you know, a larger partner, if you will, that had even bigger distribution that could take our vision and our mission and not only two times it, but like 10 times it.

23:57And so that's what we were looking for. And if that meant an exit, you know, that was something we were going to have to think about, or if it meant staying on and like continuing to grow it in another way, like we were open to lots of different ideas, but we did, we really, really wanted to find a bigger partner that had that foundation to help us grow faster. And, and in that we knew we had to exit our investors. And so we ended up doing a full circle with Evenflow, who I told you we were using their bottles way back when, and they reached out just, and it was kind of random. Like we weren't exactly, we, we knew it was coming, but we weren't exactly ready to start talking to people yet.

24:38And, um, and he just happened to reach out actually from a trade show. And so we started talking to them. We thought, God, this is so serendipitous. Like it's, you know, coming full circle here. And does this make sense? And they were looking for, um, they were looking for a way to take their brand and tweak it a little grit and give it a little bit of a spin. We were very different. They were very, how would I explain this? Kind of like if I could put it in the way of color, beige and like lights. And we were like hot, pink and loud and ridiculous. And so they needed to kind of like, they were looking for more of that.

25:18And so we had that. And, but we also had a very, very different type of customer. And so we had kind of asked a lot of questions around that and whether or not that was going to be, harder for them to like implement our business into their current business and you know like nope we got it and so we did we did a we did a an exit and we stayed on for a good while to do some r &d and you know some background stuff um it became pretty clear that we fundamentally just had very different visions for the brand and that core customer that we built and loved and we had this great connection with was not their customer, like at all.

26:02And they didn't really know how to reach that customer. And so we just kind of saw the writing on the wall. And five years in, I guess, it was like, okay, it's time to, it's time.

26:18During those four years, were you still working for the company? Or at some point you left? We never really left. We were there, but we were not involved in the day-to-day. Right. Yeah. Right. So we did, we did, we had like this huge thing of like R &D in our back pocket that we'd been working on, which was, we'd done some, you know, marketing things and those things. But they just, again, it was like a very different model, very different customer on their end. And, you know, it was, the idea was to just integrate and it just did not work. Like it was like well-known. Did your customers react to that somehow?

27:00They did. They did. They didn't like it. They didn't like it. And we lost a solid chunk of our business. And so while we maintained in all of like the mass, the heavy retail, like the Targets and Walmarts and those channels. And that was their main business. Like that's what they were really good at. And so we stayed in that funnel. But in doing that, we lost our core. So when we had an opportunity to buy it all back, we partnered with some other investors. We bought it all back and got to this place of, oh, man, we are going to have to rebuild the foundation. We're going to have to redo everything.

27:38And so we did. We went through this pivot and went through a complete rebuild and used the lessons along the way to kind of get there quicker, if you will. So when you asked, are we in Target right now? No, we're not in Target intentionally. because we wanted to rebuild this foundation with our core and our base. And we just, we know we need to do it right. Because getting them back, you know, may be hard to do, you know? Yeah. I guess it must have felt like having the second baby, right? Getting it back. Because you need to, like, all over where they left things. because it's like it's a question i have for you it's like i interviewed one more company that was through like went through the same which is battle box they sell like survival gear they're an amazing brand mid-eight figure brand they do like they have their own netflix tv show they have their own reality show like i love that company and they sold it and bought it back because of a similar reason you know they they didn't want uh to have the company that you know they didn't like the version of the company that it became after they sold it right so yeah they they put it back and they're doing amazing stuff so i forgot what i was going to ask you but yeah

29:05yeah it's i mean it's been it's been awesome to kind of it is like one of those things like you know i have some friends oh my god are you are you crazy like what is wrong like why would you do that but it's like it's like your baby and you know when you see them kind of going in the wrong direction it's like okay reroute you know and um you know once we did get it back it was it was a bit of a relief because now we we got it back right but then it was like okay now some really hard work's going to come again. And, and it, and it is, it's good. You know, you kind of learn at the times and your experiences and here we are and doing a bunch of regrowth and finding that our, our core is still there.