540: In Retrospect - They Made $1 BILLION Selling Toothpaste | HiSmile

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0:39Just head to omnisend.com forward slash founder without the E to get started. All right, now let's jump back into the show. Hey, founder fam, today I'm diving back into the archive to bring you our episode with the duo behind the massive, massive consumer business, High Smile, Nick Mirkovic and Alex Tomic. These two Australian entrepreneurs have transformed a teeth whitening idea into a billion dollar global brand out of the sunny Gold Coast here in Australia. Starting out at the ages of 19 and 20, they bootstrapped their company from scratch and are now on track to achieve over a billion in annual revenue.

1:22In this episode, Nick and Alex share how they've built HiSmile into a category disruptor, making waves across the internet and among influencers and celebrities alike. We'll explore how they narrowed in on teeth whitening as a problem to solve their R &D journey and their competitive drive that continues to push HiSmile forward, taking on industry giants like Colgate and Crest. All right, let's dive in. Hear the stories, learn the proven methods and accelerate your growth and future through entrepreneurship. Welcome to the Founder Podcast with Nathan Chan.

2:02So welcome to the Founder Podcast, boys. It's been a very, very long time coming. I'd say at least a good three, four years in the making because I've always said, when you guys are in town, we'll do this in person. We'll do this in person. So you're finally here in Melbourne. So thanks for coming down. Thank you so much for having us. We were saying as well, we've been waiting a long time to jump on the podcast. Schedules didn't align, but we've made it worse. We finally got there. So look, as I was saying offline, massive fan. You guys have built an incredibly large business. You said you're on track to do over half a billion dollars in annual revenue next year, doing over 300.

2:44The business is growing super fast. You've been doing it for nine years. But the first question I ask everyone that comes on is, how did you get your job? Okay, how did you find yourself doing the work of your day? How did this thing start? It was crazy, crazy. Yeah, it was a crazy story. I think really random people look at us, two young guys, and first it started teeth whitening, and now we're an oral care company that's really competing with some of the big guys. And I think how we started was there was a big pain point in teeth whitening, particularly amongst our age group. we were teenagers at the time a lot of people were getting their teeth whitened both professionally and over-the-counter supermarket strips and different types of products and there was one common theme the results of products work but every single person had that same pain point with the pain and sensitivity and the issues that went with whitening us being young naive teenagers we sort of jumped in headfirst saw an opportunity reached out to a bunch of chemists and pharmacists from all around the world and universities who are studying and working on whitening products we found a formulation that we thought worked.

3:48It wasn't being commercialized at the time. We bought a heap of formula, packaged the product, and then, yeah, fast forward to where we are now. We've had a lot of learnings over the years. We brought R &D in-house about four years ago, and that took the product and the business to another level. So, yeah, I think being young, naive, seeing a small opportunity, and then taking heaps of learnings to get us to where we are now. Yeah, amazing. So you guys are based out of Gold Coast. so for people that are watching and listening that's not really like a a place or an epicent epicenter for talent or even where businesses like well-known companies start it's usually out of sydney or melbourne um so i'm interested like in the early days what inspired you guys to want to start a business you saw an opportunity like did you did you know anybody on like they had online businesses did you read the four-hour work week like where did that come from exactly we were actually talking about this the other day and it's funny that and mine I know for myself personally ever since I was 14 15 16 I would always look at brands in a different way well try to say okay why do they perform better why do these do these do really well or why these sort of fell off and the likes I feel that intuition is the thing that got the hunger for business and it was something natural it's not necessarily didn't come from any one place but just the interest and the intrigue in the world of business and always keeping my eyes open and that's where me and Nick sort of joined forces and it was something that it was inept in both of us and something that excited both of us and we saw that there was this opportunity a common theme that i was seeing the same thing in the teeth widening field and we just knew we could do something better it wasn't sold no one had this great product that everyone wanted to get behind everyone used multiple products that um had the problems but yeah i feel like it's us looking at it young naive hungry to sort of get ourselves to do something and we found the oral care business and teeth widening to be the one to really target and solve the problem then make something great out of it yeah so you guys are how old at the time 19 or 20 yeah i was 19 i think you were 20 when we first started and launched and how'd you guys meet you played soccer together is that right yeah our mums actually worked together so i played yeah i played football soccer um alex also did but we met through yeah our mums working together at sea world on the gold coast um and then yeah just became family friends friends for probably five years before we started the business got you and so you you got obsessed with the problem how long did it take to launch and what did that launch look like tell me about that first sale i'd say it was a good 12 12 months before launch of doing research testing product and and really making sure we had something that was a bit different talking about launch i think yeah we we basically manufactured a heap of product with this formulation that we thought was really good um and i think influencer marketing companies were doing it but it wasn't really a thing and now the only reason we started and people think of i smell is this influencer brand because that's how we started um we didn't have the budget to market this product so we thought this product was so unique and so different in how it worked it was whitening that didn't cause pain sensitivity and it looked different we could send this out to a heap of people um get them to give feedback on it and hopefully they'll share it to their instagrams at the time so we did that it looked cool enough look unique enough and it delivered results in a different way and at that time people weren't being paid to post or paid to promote so people were just sharing it and they felt a value in that product and the value in the brand that we're trying to create and they started sharing and it felt special and we started to gain a little bit of traction and then yeah the funny thing about the first sale we got I think five sales in the first couple of days yeah but us again being young and naive and trying to do everything ourselves we didn't connect the payment gateway directly so we didn't collect any of the sales so the revenue that came through which was five six hundred bucks which we were like this is amazing there's proof of concept people are buying this just went to nothing we had to contact those people hoping they would come back and buy i think one of them did and they were buying two two kits at the time um but we just had to start from scratch and honestly there's about a million stories like that where we took learnings that we paid the price at the time but because we paid the price and we felt that pain ourselves we won't make that mistake again yeah so you guys weren't using anything like shopify no they didn't come until like three years two years later really and there was so the crashes so we'll be launching we've got this big person to post and then it crashes and it's like your whole world comes crashing down it's like this is everything that we had 100 of all the money i had nick had all right let's do it things are crashing and we're learning on the fly we're figuring things out and then we came across all right this thing shopify you don't have to you can't uh shut down the server like and i remember yeah we're not technical people so yeah can't crash it can't what do you mean we're just used to this hosting it on our own or with like one of the web development agencies on the gold coast a small mob and thinking we're a small business they put us on a basic server basic hosted server plan shared server with a few other smaller clients and if we were to send 50 people decide it would crash um so yeah we just learnt the hard the hard way i guess and if you look at it now looking back we wouldn't change a single thing i think the fact that we took those learnings on ourselves and we felt those um pain points is why the business we believe is in the place it is today yeah so i'm really curious um just the whole gold coast piece you guys meeting is this your first business yeah yeah this is first business business the success you've had is just like out of this world out of coming out of gold coast like i mean a lot of found is a lot of people and like i've always been really impressed from afar just like the moves that you guys are making um so i'm really curious like when it comes to the brand like a lot of people watching this they want to start an e-commerce because they want to start a business but you have this feeling like well that's already done because it's so easy now to start an e-commerce business and like there's a lot of copycats and i saw like in your industry there were starting to be a lot of copycats and you guys were an early adopter but i i saw like there was a lot of teeth whitening companies out there and you guys really legitimized the product i thought that was a brilliant move which i watched from afar where you brought r &d in-house you clearly differentiated your product you did a rebrand which was really fucking cool and you really kind of stood out in the marketplace and now are clearly just growing like wildfire.

10:40Can you talk to me how you came to that realization that you needed to double down on product? Because you guys are great marketers too. You did influencer marketing really well. There was a time where we were very, very high, high, high spenders on Facebook ads for founder. And we used to share the same account manager from afar. You guys were in the top and we were at the top. So I'm curious, you guys were really strong marketing, but you made that shift to product so for the first question is how did you come to that realization and the second one is what advice would you have to people when it comes to wanting to start a product or they have an idea they're passionate about a problem but there's so many other competitors i think two parts i'll touch on the product part and that's if you wanted to go in the marketing and the evolution of that side but are you hesitating to take the next step in your e-commerce journey founder plus has you covered with proven frameworks tailored to your business needs for fast results a supportive community of over 30 000 like-minded entrepreneurs and weekly live mentorship sessions founder plus is your key to success try founder plus today for just one dollar for seven days and start building your dream business with confidence you can visit founder.com forward slash start dollar trial or click the link in the description to claim your trial quite i i think how we looked at things so we obviously built our business with this teeth white it's singular product and which worked really well helped us stay very lean but I think the thing that makes us unique we're very extreme we go down paths and down rabbit holes and we really take as many learnings as we can but whenever to obsess the sake we have to stay on this path even if it proves us wrong so we learn we learn we learn we did amazing with this kit and like you said a lot of copycats started to come in what we had to do we had to completely break ourselves we had to change and remove pretty much all this content all this cache that we built over three four five years and say put that in the bin we have to transform ourselves over the next three four years and that's where we said okay let's go heavily invest in r d let's get the brightest minds we can um let's rethink what not just teeth widening but oral care could look like and we wanted to expand that out instead of just being so niche yes um and yeah we got the brightest mine we we ticked that box we invested in a great facility that we were able to test every product in-house and that speed and efficiency of from concept to a product that we could actually send to our manufacturers was happening in months as opposed to years and the quality that we were sending was just immaculate so if you go then back to okay if someone's looking and wanting to create a product i think ignore the fact that there are a lot of competitors out there that that to us doesn't matter look people have done toothpaste for 100 years doesn't mean we weren't able to create a toothpaste that's more exciting and more fun just because there's a lot of competitors it doesn't have to necessarily stop you from making the best new version and it doesn't require the biggest change like what most people think and i think not being overly obsessive with oh it has to do this or it has to that just make something fun that works with the market that people are gonna love it will work so you look at the flavored toothpaste for example we really flipped that on its head we created a great base foundation as opposed to sort of these sensitivity or gum health ones we said let's make one that ticks all the boxes but make it fun and exciting and make this so tasty that everyone wants to have it so whether you're six or 60 you're getting excited about brushing your teeth again then it was that that breaking of the mold it didn't mean because there were thousands of different toothpaste options that we couldn't do it it's just you've got to be the one to put it in market it um get people excited about it show the difference through reactions of people um and yeah it will work so i think that sort of ties that little story together yeah and i'm just curious though like that strategic move has been like a stroke of genius for you guys and it's really helped canapult the brand i'm sure because now you're you're not in like a red ocean like i don't know if you guys read the book blue ocean but like you're in this this big blue ocean now it's not you're not fighting against everybody else you're carving out your own niche and big market like where do you learn like how did you guys work that out like do you guys have mentors like who do you learn from are you inspired by the states are you part of any networking mastermind groups are you part of ypo like talk to me about where where do you what how are you guys feeding your minds because you've there's clearly something going on there i'm curious yeah no honestly from a mentor or groups perspective we've never been a part of groups we learn from everyone in every situation that we interact with or engage with those few little stories we shared at the start there's a million of those that we wouldn't have enough time if we spoke for a week to share all the learnings that we had throughout the business and it's our obsession to want to get better we put our own money in we wanted to taste every part of the business and and when we come back to how we how do we pivot and move to caring more and investing more in the product and why was that important and now you talk about the blue ocean that we now swim in that all came from us feeling enough pain early on we'd make a move someone would copy it we'd make a move something else would happen and and it was almost like we're competing and i think back to what you said about the gold coast the beauty of being on the gold is you're isolated you're not looking left or right you're looking at your own self and you're running your own race and i think that early on really really helped us and then i think as we started to do things in the business and test things and bring people in and go okay we're great at marketing we need a better product or we need this or we need to bring our operations suck like we don't understand the final cost of our delivered product or we don't understand true profitability we understand cash flow we're suffering on that side like our obsession to want to understand the full wheel made us really come back to okay when we're building this business moving forward we need to build a moat around what we do we can't just do a moat early on the first three years we're making moves those moves are either getting ripped off getting copied whatever's happening people are taking what we're doing and trying to do it for themselves and then you're swimming like you said in the red ocean for us it's like how do we build a moat and protect every single part of what we do because these days you've still got the same amount if not way more brands that you would call copycats however they're copying one move you can't copy the full pie you can't we're swimming like you said in the blue ocean swimming we believe by ourselves we've got big competitors now got the colgates and the and the big unilevers but we're in our own race because the way we do things is so so different to the way any other brand does it yeah and i can clearly see that right and i've been watching the journey from afar so you're not part of any networking groups do you guys have mentors that you're learning from people that of built large e-commerce brands or exited so it goes back to it's everything like I'm learning from the conversation we had five minutes ago about what you did with founder and how your trend like no matter who it is there's something to learn from someone and sports teams sports managers like no matter who what where if it's a good fundamental principle it's something you can take and bring into business so it's like just isolating it to other business owners or people work it's like it's too limiting there's other people other principles that you can really grab from and if it's really really good bring it in and so we're made up of thousands of different minds and the way people do things and we try to bring as many of those good habits good principles into what we do and i think it served us really well and like nick said being on the gold coast we do our own thing create run our own race we're not looking at what the other guys are doing whether you're big small medium left or right we're doing our own thing and we're loving to do do our own thing and trying to get other people excited and encouraged to do that as well yeah so talk to me about team right because at the size that you guys are at you can to really grow a business and scale it to the to the heights that you want to scale it it comes back to people it's going to come back to your leadership team the strength of your leadership team and the leaders around them how have you guys approached talent being in the gold coast we talked about it just briefly offline but I said let's talk about it while we're shooting because I think that's an interesting challenge because a lot of people they think oh you know if I want to start a business perhaps I need to go to Silicon Valley right or I need to be in a happening area where there's a lot of great talent or people around and you guys are starting from the Gold Coast and you build a very large business competing on a global scale how have you found developed talent and really built your people and culture to scale this business.

19:17Yes, it has been very, very tough and very, very challenging. And like the business itself, the people in the team side has had its own ups and downs and own challenges from how we operate as leaders to how we thought the teams would best work to how we thought a leader should be and operate. We've brought through so many different types of people from super experienced people from overseas to a young hungry person who's fresh out of school who just wants to pick anything and everything up and they sometimes turn into an absolute weapon across operations or whatever that might be and we've done everything in between and there's no right way of doing things I don't think but for us it comes back to like Alex said running our own race we we never wanted to run a business the way other people would run a business because we're two very unique different individuals and high smiles are very unique different business so for us it wasn't about looking at other companies and how they were structured anytime we did that and tried to follow another model or apple's organizational structure or how they hire people or how they ladder up and how they have their leadership sort of sitting whenever we did that we'd fail coming back to what we're about and who we are as people and what we've found is the best leaders and our best leaders roll up their sleeves and get stuck in they don't host meetings for meeting's sake they do the most work and if anything when you're a leader you're someone else's assistant first and foremost you're assisting your team not the other way around because that's the way that we operate and we run we're assisting our team not getting people to assist us i think if you earn that respect you earn the position of a leader the other thing is we pick leaders who are yes they're in specialized roles you might be the head of creative you're very much a generalist when it comes to that you've got to have an open mind you've got to have a little bit of a touch and understanding of business you've got to have a little bit of a touch and understanding of marketing to understand that full scope to better brief and better work with a team that is super specialized and the best at doing what they do so for us we're in an amazing place now we're always aiming to get better and better and better and develop the leaders that we have within but we truly feel when we look today where we're at with the people in the company we've just reached i think 110 just over 100 heads yeah um in the office we've got some amazing leaders in place who feel empowered who feel like they they own their role they feel like they're not micromanaged it's not reliant on myself and alex um to make every single decision and the teams are thriving because of that because you get to a point where it's easy to manage a team of 20 with myself and alex but you get to over 100 you really need to have some really really good smart um well-developed well-trained leaders who you can trust and who trust you to then develop and grow the next crop and the next crop to get us to 200 300 and whatever that means um in terms of people so what do you guys look for when it comes to to great people um i think it's if i look prince ben i'll use a couple of examples it's the people who are hungry and willing to get to work and get stuck in the people who are really smart and know what they're doing in their field but are willing to pick up the dirt and work at the lowest level if required um i'll give you a great example of the r d position um at high small so this is a position that we searched far and wide we looked at the top head of r d's from your unilever top top um firms we spoke to all of them and there was always something with a preconceived notion of and a limitation that existed there from whatever exists you have to fit within that sort of mold yes our idea was we wanted to completely break it so we needed someone who had the knowledge of the science and the chemistry required but didn't have any true understanding of what already existed so that when they came on board it was just an open playing field go as far and wide as we could so in the end we recruited a head of science from one of our local universities on the gold coast one of the brightest minds that we have at high small really open but someone he's willing to get stuck into the little most micro details and think as broadly as possible and he didn't come with the limitation of well we can't do this or everything we try everything and then once we try if it doesn't work we're all happy to part ways and move on to the next thing but it's that willingness to try everything to get to that new product new concept that's the ideal that that we're sort of looking at throughout and I think it's a great example because it's so complex it's complex and so technical um that we've been able to break it even in that r d side as well on on what alex said it's like when you mentioned about marrow our team like if i was to say our head of product and procurement she wanted to be a teacher and she came through our customer service team and yeah she's head of product and procurement killing some of the most amazing and getting to to market and manufacturing some of the most amazing products in the world our head of supply chain um the guy runs our supply chain he played football with me um and he just happened to come through actually working in the warehouse and now he's running the supply chain side of the business justin who you spoken about our general manager he was writing copy at a marketing agency working casually for us at the time on a trial he's today he's our general manager i think you look anywhere head of marketing ahead of marketing used to be um in sales for a software business so there's not if you were to look at them when they started at high smile and when they came in i don't think any other company would have given them the chance um but like alex said it's character character over everything because every time myself and alex didn't know a thing about r &d didn't know a thing about business didn't know a thing about anything it came down to what we believe is character and competencies and then just willing to pick up pick up things and and a good personality to work with other people to make things happen so yeah i love that um so i I used to watch from afar as well this vlog that you guys used to put out.

25:19A lot of friends of mine overseas as well being the e-commerce space, I used to watch that. You guys probably wouldn't know. You never used to get many views. You went down this pathway for a little bit where you guys, it looked like you were looking to build your personal brand. Then you did it for a year. I got to know and feel the team. There was the videographer. Was it Stefan? Stefan's brother, Daz is the videographer. Yeah, yeah, yeah. So like, so I used to watch that. It was so cool. You guys should have put in a lot of effort as well. And then after a year or so, it was all gone. What the hell happened?

25:53Tell me about that. Like I've got to find, because I've always wondered like, because it looked like you guys saw the power of building a personal brand and then you just wiped it all and you just cut it all because it looked like you're putting a lot of effort. And it was cool, but you weren't getting many views either. So it's funny. and it's funny you say that there's nothing at high smile that we haven't tried and i'm telling you nothing we tried it all and through that again every situation every occurrence every little detail we're learning from every every moment it's and it always guides us in what is the right path there's a great example of okay let's test this let's really try to build up that personal brand and see what can we build beyond this there's so many exciting things and then when we took a step back and it's like okay what are we doing this for for us it's really about creating this new um category what we're calling small okay let's i mean it takes a lot of time to do that if we're taking one percent of time off that we're losing and that was something that just took so much energy and time because not only we're now thinking of what is our progression forward which business always moves and it's always changing and to then have to think about okay are we getting this on camera or not it's like our north star was how do we create a new category how do we make something special and we can't have any distractions from doing this so it was a great great time and something that i'm so happy that we did do it because it made us learn a lot okay what's it about what what really exists there and it gets you out of the present because you're always thinking about okay am i saying this the right way to appeal instead of is it am i actually just saying it the best way or thinking in the best way as well so it took us a bit off track um more than what was necessary and i think yeah i wouldn't change it for the world but i think after we looked at it our north start to to do what we're doing in this space requires full 100 focus and we can't change from that because yeah i remember watching one and you were setting up an office and you wanted multiple walls i remember you're saying nick you're like oh we want model walls so then we have multiple locations to shoot from and multiple backgrounds that's how i thought about when we moved to this office like i remember that from that particular tip so i have a crazy memory and i always wondered like why did you guys stop that so was it literally like just one day you came in what one of you guys and see this has got to stop or like what what happened we spoke to each other i think like alex said it was the north star thing was so true like alex said we've tested and done so many different things sometimes it takes us in the wrong direction i think we we personally we don't want to be famous like it like if people know us cool we're happy we're friendly we're happy to say hello speak to people but it was it was doing the it wasn't where we wanted to go speaking opportunities podcast we love doing them but when by all means we don't want to do a world tour and just do that we want to build the best business and get people so interested that they want to ask us a question we don't want to build the best personal brand because we're really interesting characters so it's like we went back to our roots and went let's do it with the best that let's build the best business people will be intrigued people will be interested we have plenty of opportunities for us to speak and get out of comfort zone because we do we do like doing things like this gets us out of our comfort zone shares the story inspires someone it's amazing but through the vlog like alex it was so labor intensive took up so much of our our mind power that sometimes you feel like you're not being authentically yourself the more you get into that race and you were conscious we're like we don't want to become actors that's not what we want to do we don't want to be on tv yeah we it started going all the emails were getting down the wrong path was to be on tv and do all this other and we're like, no, no, that's not what we are and who we're about.

29:27It served its purpose. I think it helped a heap of people, but I think we can do more by doing good work and then speaking about it on platforms like this. So I remember even during the vlog, you guys were working on some other products or it looked like you're looking to launch some other brands. Did that ever happen? What happened there? No, we did. You had like a secret project or something you're working on? Yeah. Your memory is probably better than mine. we did we did we did flirt with the idea of launching other types of brands because again when we did launch into high smile and we saw the early success we were like right we've got the recipe for success as you've seen a lot of people do and then again the vlog was almost a bit of a project like that where it was a bit of a wandering eye we started dabbling into something else we're like one percent of growth in high smile is better than three thousand percent of growth in something else and truly we truly mean it we're passionate about this category a lot of people go what's to be passionate about teeth, whatever.

30:22It's boring. It's a boring category. We're really, really excited. I think we're starting to see that come to fruition now in the products that we're bringing out, the battles that we're having with competitors, the retailers that we're playing with, the activations we're having. We're truly making a dent. There's a lot of skincare brands. Haircare is a big market. But when you look at small care, oral care, no one's done what we've done and no one's going to do what we're about to do. And I think that's, we've got this once in a lifetime opportunity in everyone brushes their teeth every single person not everyone uses this skincare product not everyone cares for their hair every single person that i know has to be 99 percent in our major markets brush their teeth we've got an opportunity to be the brand that that dominates that category for us being competitive people who have always played sport our whole lives there's no bigger stage than that to compete on and to to wake up to every single day um to that massive never-ending challenge yeah so so you you really focus like it's just so dialed in yeah so switching gears as well um you guys have done a lot of cool stuff on the influencer side you've worked with i think is it all the kardashians yeah we've worked with i'd say yeah all the all the kardashians but maybe one or two now i know you probably can't share exact details around on the commercial arraignment arrangements.

31:44Can you give us like kind of an indicative figure around what that kind of investment is in any capacity to work with them? And why do you choose to work with like influences this big? Does it, do you get the return? But I guess that's what people would be curious about, right? Like, is it worth it? 100%, I think that's what people ask every single day. It's like, is that worth it working with Kim? Kim's a massive face for the brand. We work with her a lot on a lot of our products. look when it comes down to what something's worth i think it's looking at the business holistically what like when you look at nike for example they'll attach themselves to certain figures not just to sell more product but to tell a story to tell a story to retailers and and to it to sell dreams to to potential customers as well for us we look at it in a similar way working and engaging with Kim to launch a product.

32:37Does it get sales? It gets sales. Does it get attention? It gets attention, but it takes the brand forward. It positions the brand where we want the brand to be positioned. It taps into a customer that we want to sort of get the attention of. And it obviously helps and assists now that we're in retail, helps and assists our retailers with driving people in store and making high, small the beast that it is today. I think just working with big talent um isn't going to make a brand make or break a brand i think for us influencers now is if maybe less than five percent of what we do and where we put our dollars and where we put our attention like you look at we spoke on r d yeah other marketing avenues retail support um the team itself and what we do there spending money on our own internal culture to to get that team sort of firing and make them want to work for high smile um influences went from something that was such a huge part of our business to now probably where it should be around five percent of what we do and where we put our energy and focus and i think yeah for sure working with someone like kim elevates a brand positions us above a lot of the competitors like when you talk about our space i don't think some of the big brands are cool enough to work with a character like kim and i don't think some of the smaller brands are reputable enough to work with someone like him so we're in this unique place where where kim is a is a great influencer for our brand and a great um face for the brand and and someone who i think has a unique alignment with high smile compared to any other brand in that category yeah okay awesome thank you for sharing and uh you guys were pretty heavy on direct response paid advertising i know you did a lot in the snapchat space as well killing it on TikTok very early on Facebook ads when CPMs were much more cheaper than they are now.

34:26I'm curious, for many e-commerce brands or many companies in general, when the privacy stuff changed, iOS 14, a lot of brands that were heavy reliant on paid advertising, direct response type stuff, they suffered. but there was one key thing that I saw and that was the brands that had a strong retail arm behind them they didn't really feel it but the ones that were heavy paid only they really really really felt it what did you guys do and how did you guys overcome that challenge in particular and talk to us when did you start looking into retail because I think that's a big piece of the puzzle now for d2c brand definitely i think on retail probably about three four years ago we had the discussion and then actually properly started activating about two three years ago yeah um from a d2c perspective and when you talk about the advertising ios 14 i think it always comes down to owning what you do building a motor around what you do if you're overly reliant on influences overly reliant on advertising overly reliant on retail um some you're you're at the mercy of something i think you want to build a true brand true business you um you want to swim in that blue ocean that you spoke of before you want to own as much as you possibly can in that wheel and you want to be in control of that success as much as you possibly can i think that gives assurance to the people who work for the company the company's not yo-yoing up and down um you know there's some stability in the strategy and what's going on if retail if there was to be covered retail stores closed we've still got online something happens that we've got the professional network as well for a product perspective we're not just in whitening we're not just in oral care we're covering that full that full range of oral care from cosmetic to general care so for us we've we really looked when we when we spoke a couple years into the business about building that moat we took that super super seriously and even today like we're nowhere near where we want to be when it comes to protecting what we do and it doesn't just come from people think of protection as ip or or something legal.

36:40It's like, no, no, no, there's much, much more depth to that. Make it so, so difficult for someone to literally copy exactly what you do because what you do is so much more than what you're putting out. It's what's in those four walls in the office. It's the people that are there. It's how you operate. It's how you move. It's your strategy and where you want to be in the future. No one can copy that. You said that you guys got a lot of stories, lots of battle scars. can you both share maybe from both your different perspectives kind of the hardest time in this journey because building a business is tough the the level that you guys are playing at with such aggressive scale and growth fundamentally things break all the time to my knowledge you guys are bootstrapped is that correct still to this day so you you know you've got to you've got to worry about cash flow and sales sales is one thing another thing is to be to fulfill that with an e-commerce business and you can get yourself into a lot of trouble especially when you bootstrap so i'd love to hear from each of you like the hardest time that you've ever experienced during this journey and it was there ever a time where you but either of you felt like giving up no it's a good question i feel if i go back the toughest time was at the time that we made that decision for that transition that transition from singular product business is going great things are working it's easy to manage and it's a team of say 10 to 20 um what things were things up and breaking that so obviously transforming to r &d led building products that cost more at the time that everything becomes more expensive advertising marketing the whole lot came this oh my god we have got to roll the sleeves right up so this was called three odd years ago um and yeah it it was the time that was very difficult bootstrapped cash flow all of that we had to really say okay we've got to make ourselves out of this we know what we're doing fundamentally makes sense it will be for the longevity of high smile and we'll be able to carve our own thing but it's going to be a tough year and a half and it was a tough year and a half and going back to us looking at things, it was the best year and a half for us that we could have ever gone through because it's the thing that taught us about so many things in this short little window from how do we look at sales?

39:05How do we look at the business as a whole? How do we look at products and create these amazing products and how do we make something more? So how do we expand it out? How do we not limit ourselves just to one thing, whether it's advertising or the products or retail or online? and i think that those that key moment is what has transformed the business the toughest part which it might which is what most people say it's the toughest part is what makes um makes it shine and make it makes it what it is and i feel no more is that true than what we experience just on that one did you did you guys have to go in the hole to be able to make that significant investment in the whole as in negative absolutely and we and looking at it's like what it was the toughest most grueling thing because it was on our own back when the the last result we're never asking for anything external because we have this vision we knew the vision never changed it was just that transition period with everything stacked up at the same time um made us that crystal clear focus of like it is exactly what we need to do and that's business that's what makes business so special is there are these tough times that you have to become even more clear and even more precise with the actions and the moves you make and yeah again speaking that's what has made I guess and created and curated what we are today and how we sort of operate in this very unique where we're not overly we never now go too crazy in that one direction so we have these amazing people who we work with who each own their own thing but our goal is to always take all of the moats into perspective to make the best decision so it's a bit of a change in the perspective of how we we operate it yeah I think that that's someone I'll tie it down to thanks for sharing yeah I I think Alex has pretty much covered it and summed that up.

41:02But I think one thing that's interesting from what Alex said, and I don't know if this is luck, intuition. I think you need a bit of both when it comes to running a successful business and getting to where we are now. But we've never waited for a catalyst. We've always been that catalyst for change. So we didn't decide to change as a brand and from a product perspective and invest all that into R &D and product because something happened or something triggered it we've we always had this gut and we still go off gut feeling i don't know it's just just something that we've always had and it's we've got a similar gut i think because the intuitions tend to align um but there's something in us that goes we think we need to go in this direction it's not like you said you spoke about mentors before we don't get on the phone and speak to someone say should we do this should we not it's the two of us jumping in a room going i've got a bit of a gut feeling we need to do a bit more of this and then alice go you know what that's weird I agree with that and if both guts agree oh we do it and every single thing we've done we've pivoted when we moved it's not been because of a catalyst we've felt something and before something's been on fire or something there's been an issue or there's been a drama or something's forced us to change and move we we have seeked to make that move and I think it's because we're never satisfied or never we never sort of sit there and go what we're doing is amazing we're always looking forward always looking at that next step and I think now we've got the responsibility to do that we don't just have myself and Alex we've got over 100 people that we're responsible for as well for their growth and their lives and their passion and their careers so for us we always have to be obsessed with moving forward moving forward not smelling the roses but instead looking at what could be a potential red flag what could be a potential harm in the future rather than waiting for that catalyst to bite you in the ass and go make that change yeah and where does that come from like that hunger where does it come from is it you guys fall like did you guys always have this your whole life i think it's that's competitive nature that our obsession with sport and the teams and the managers and the great sports stars and sports managers who have done exceptionally well it's something they innately have in themselves if you look at the top top top level of performance in sport you have to be another level you have to transform yourself whether it's football you're talking about you have to treat if you're a striker 10 years ago to what a striker is today it's two completely different things you have to transform yourself and become something even better whatever the standard is you've got to break that as well and i feel business is the never-ending version of that it's every 10 years look you're always in that business you have to transform the business the way you think the way we're going to elevate in our category how we're going to we need to accept that over 10 years there'll be someone that creates something special in our category how do we keep our eye on our eye on the pulse and how do we obsess so much at where the one's constantly transitioning and everyone's looking at us as what the next move is in the category and yeah it's just this obsession that both of us have and yeah we just don't sleep on it's not something that we practice it's not something that we have this technical thing we do it's just a never-ending every day type of thing it's that constantly that one percent effort goes to that every day yeah you guys love to compete yeah we love it yeah so put frankly so this is what's interesting is like to get a business to any kind of true worth significance it has to be an obsession right but there's the other side of the table where you can burn out have you guys experienced burnout out before I haven't experienced burnout I think as hard as we try on the business side and I'll speak for myself and I know it's the same we try equally as hard at home to be there for our families at the same time I feel you it's not something that oh I've worked so hard now I'm home I'm I can relax as of you what you have to work hard to creating a good family creating a good home you have to be emotionally there your attention has to be there so when you get home you're there you're not oh now I can relax and go to sand I feel that's the thing that makes it most it's the thing that's the ultimate true north star for both of us that family nothing really matters more so you're doing this amazing thing this business that we'd love to do but coming home seeing my kid there's nothing better there's nothing that excites me more so I think it almost if anything neutralizes me really well it keeps you grounded keeps me grounded you guys on the Gold Coast, you both surf too?

45:34Do you have time for a surf? We try. We try. We're not too good at surfing. I've tried. I wish I picked it up as a kid. It might have been better, but we're probably the only two people born and raised living on the Gold Coast that don't surf. We love the beach though. Yeah. So people would look at you guys from afar, especially younger types, right? You know, early 20s, early 30s, and kind of look at you guys and go, wow, you guys have got it all. An interesting question I like to ask people is, from your perspective, is it ever enough? I think it depends what you're doing and what you're trying to do.

46:13I think people usually look at that from a financial perspective. And I think early on is when you get carried away from success, by success. And you think about, I want to do this and I want to do that because you're young, you're immature. But now we feel so content with what we have in that respect, but our competitive side it'll never be enough no matter where the company gets what the company gets to ignoring the revenue numbers ignoring anything on that side for us it's like the obsession of developing the next rough diamond from high school who had no opportunity and now they're now they've got the opportunity next five years to become a head of or a leader in a department or whatever that might be that's exciting and the challenge of taking on the biggest brands in oral care that have been there for hundreds of years and dominated every single bathroom for us to be able to have that place so from that perspective the challenge i can't possibly see where where that stops and what the limit is because every time we think the company's at a level where it's like oh this is great it's like there's always another level there's always somewhere else we can take it which is super super exciting the competitive nature never is about the dollar you make or the dollar you have in your account it's a weird thing and yeah it's always about how do we transform what what we're doing the category we're in how to like nick said how do we get the team like these superstars and how do we make them more special and the the absolute last thing that you think of is how much do you have and the competitive nature isn't around that which i feel if it is it's it it's hard to create that business that survives a lifetime that's because you're not focused on the right thing you can't really think of the best things because it's always an incorrect sort of path that you'll take well yeah it's it's a it's just really a scoreboard right that's that's all it really is yeah um so the reason i asked that question is because i think all of us as humans we always tell each other oh when we get here it'll be better when we get here it'll be better how amazing will this be and then when you when you get there it's like what's next and that's very common amongst founders successful founders and you guys have the same kind of makeup right you guys are telling yourself how how good is this going to be we get there and then when you're there you don't even smell the rose what's next what's next what's next what's next what's next so look i could talk to you guys all day we don't have a all day unfortunately but um i have to ask like for people watching if you guys were to start a brand now in 2013 like what what would you do how would you approach it like with everything you've seen all the lessons all the the money in the bank in terms of lessons that you've had like incredible like how would you approach it can you give our community kind of from a how you've built high smile how would you do it in 2023 just because a lot has changed and it's still very possible right like it's absolutely um and maybe you can talk from a product side you can talk from a marketing side yeah okay good idea i think first and foremost not to get crumbled by there being too many competitors in whatever you want to do so first and foremost find something that you absolutely love as in a category an industry or something that you could really get behind and support because you figured out a way that you can do it better than what it's already being done and i feel when you have that idea as fast as you can to create the concept that you have in mind put it out there don't wait don't overthink just put it out there and start that process and you're going to have to start small effectively be very effective with that you don't have to start big and put crazy amount of dollars in there don't look for external funding don't look at any of that just figure it out get it up and running as quick as you can create a product in a very small batch and just get going i think the thing people do most of the time when they're first starting out they just get crumbled because oh it's not perfect or there's too many competitors or it's going to be just do it just do it and if you truly love it you're going to succeed you'll make the best product customers will get engaged you'll figure it out if you don't you'll never know you'll never have the chance to do so so just a believer just do it just get it done thank you Nick?

50:34Yeah, I think it's funny. We always talk about how hard it would be. Like someone's, if people say, oh, would you sell the company? And people start throwing these crazy numbers. The hardest thing is, I don't know how we would start another company again, because you have to go straight from step one. And we take all the learnings that we've had, and we would immediately inject that in to that company, which means we're starting ahead of schedule, which is probably a disadvantage i would say weirdly because we would naturally as as egoless as we want to be you're coming in with a bit of an ego if we were to sell up shop and go let's start this glass company we're going to sell glasses we're coming in with all the learnings we have from high small and no matter what we're going to treat that as high small which is the rock the person who comes in fresh and starts that glass company probably has a better opportunity of doing well I believe and succeeding because they're running their own race.

51:29They're focusing on it themselves. So when I look at what we've done as a brand, what we've done as a business, I wouldn't take any of those learnings or install them in my head and have them so I don't make those mistakes. It's all those little mistakes. And to what Alex said, you've got to jump in. You've got to make that move because you want to and you need to taste every single part of the business. I don't care if you're a finance guy, you need to figure out marketing. If you're a marketing guy, you need to figure out finance. you need to figure out legal you need to figure out product you're not going to go study law and get your degree and become the best lawyer that's by all means not what it's about but you have to be dangerous enough to have a conversation with a lawyer who's going to give you advice because you're making the decision if you truly care about that glass company you're going to want to touch every single aspect of that glass company throughout its journey not all at once not at the start like alex said just start but don't try to be high small from day one start that glass company start selling it at the markets find proof of concept find what people like get customers feedback do it like the good old days and i think just because we're in the future just because we've got more technology don't get crowded in thought and don't get distracted i think people first start a company and they look online and they go i want to be the next high smile i want to be the next this the next nike the next apple focus on yourself take inspiration for all from all of those tests and things that they've done um but understand where you are today in your journey because tomorrow will never be the same as today and you want to really appreciate that and while we don't smell the roses we appreciate where we are in our journey we could easily where we sit today raise hundreds of millions if not billions of billions of dollars and the offers are there to inject straight into high small but we'd still be in the same place we are today maybe we'd sell a bit more product we get a bit more reach in retail we up spec our office in our space but we would have then skipped 10 years of learning that we would have had and something's going to crumble because we're not ready for that yet clearly because we haven't achieved that yet so for us it's about taking those steps all the way through the business and obsessing if like i said if you're starting this glass company start that glass company with yourself your friend whoever that is and touch every single part of that business don't try and make that glass company this is made by ikea don't try be ikea today ikea wasn't ikea at the start high smile wasn't high smile at the very start we're very different to what we were before and it's because we touched every single part along the way.

53:54So there's something about you guys where you guys really want to just embrace that journey. You're not looking for shortcuts. No, you don't want to take shortcuts, not at all. I have to ask, just delve a little deeper, like most people are looking, listening, watching, reading. You guys could raise a lot of money from PE or VC and you haven't, why? Because you love to compete. You could go faster and take the market even faster, right? Hypothetically. So why? I think it comes back to sort of what I said. I think you take that money on, you use that money to spend on the strategy that you have today.

54:37But the strategy you have today is ready for what you're there to do today. You will put together, we've never put together a business plan or a case study or anything because we roll with the punches because we haven't had to we've we work with what we've got so we're ready for the level that we're playing at today but it's like you i love playing football you put me in the premier league today if i played in the a league i'm not ready for that yet i need to earn my dues i need to earn my stripes i need to be top scorer in the a league before i even consider sitting on the bench of a premier league club and training at the premier league club you can't put me in a game yet so we see funding in this exact same way we can hypothesize and we can cross our fingers and go i hope this works or we can control the outcome and go okay step by step we're going to have wins we're going to have losses but going to play in our field in our race in our space we're not going to be colgate today not going to be apple today we're not going to be nike today but they didn't get there in one day either i think you see a lot of companies flash bang and then crash ultimately because they maybe tried to bite off more than they could chew they look to the left you talk about silicon valley i think if we were in silicon valley we have would have taken funding straight away and i don't know if high small would have been the highest mile we are today we probably would have been a tech company or an app or done something different because that's what everyone else to the left and to the right of us was doing but we stayed on track we stayed on focus yes it's changed a little bit throughout um the journey but it was never these crazy turns or turbulence that a lot of brands face because we tried the whole time to be in control of that race as much as we possibly can and i think money is the the biggest the biggest thing when it comes to it i think you could only do what you can do with what you have in the bank to work with you can't spend money and you can't we can't we couldn't launch into all the retails we're in today that would have sunk our ship if we had all these contracts on on the table we wouldn't be able to fulfill them because we would need money to fund those projects and then you fund the project your business isn't ready you get the product in the stores but the product aren't selling because you're not where you need to be so there's always I believe 90 % of the time it comes undone somewhere unless you're really, really, really, really, really ready for it.

56:44Yeah, no, thank you for sharing. Because it's interesting, right? Like the economy has definitely changed and you look at some of these DTC brands that are on the NASDAQ, hardly any of them are profitable. And I know you guys know that, right? And they're so capital intensive and the culture is let's solve the problem with more money. and you guys like it's interesting because you know founders bootstrapped as well and i'm a big big believer in that in early days right especially like for a long time right and having that to be resourceful and work out how to build a business and now that this is what the markets are looking at they're looking at profitability they're looking at how how is a company actually sustainable so it sounds like you guys uh maybe in the future but when you think you're ready like what's the plans for the future of high smile what where would you like to see this business in the next decade in no near future or long term do we have intention to part ways or bring on an external partner i think for two reasons and to add on what nick was saying one it makes your focus around making money and two it slows down your vision to get you to where you are because now instead of us moving at the pace that we do which is insane like what we when we see something when we both think about it and if it makes sense we move and we move very quick that process slows down the one who's doing the newest stuff the most exciting stuff and doing it fast and effectively you're going to win slowing that down and then focusing only on what your net outcome is every quarter or whatever that is it's not something that would be a part of um anytime soon and i can't see it and And I think that makes it even more exciting because it shakes up that industry.

58:33And I think it alerts that if you're a product business, this is an unpopular belief. But if you're a product business and you're asking for money because you're not yet profitable, there's something wrong with the business. And you just putting more money in it is making potentially a problem worse and harder to get out of it. So I think that's going to shift a lot. And I think we're going to see a lot of that over the next year or so. look if you got a business model where you're a software company and you're going to transform to selling ads or whatever that might be different story and i'm not going to but if you're a product business that is finding it hard there's questions that need to be asked and i think that's going to be the big shake-up over the next year or two years all right last question for you both uh always ask this to anybody that's a guest these days i want to hear from each of you if you could have dinner with any entrepreneur dead or alive who would have been why steve jobs yeah we've always when we started we loved apple we still love apple today so it was one steve jobs so the packaging yeah he's relentlessness to create something and transform something and now he's dead and he's if you look at what's still happening with apple they're untouchable so the full experience yeah and everything you got that yeah all right we'll wrap there thank you so much guys thanks for having us hey guys that's it for today's episode so i got one quick favor from you we put in so much effort to find the most craziest hard to reach founders super successful fans the greatest founders of our generation all i ask is can you share this with a friend just one friend it really really helps us grow this show and it's going to Help your friend, right?

1:00:14So please share this with just one person. It would mean the world to us so we can grow this show and build this community. All right, that's it from me. I'll speak to you soon.