Cashflow, Unit Economics, and Bootstrapping $550M ButcherBox with Mike Salguero | Ep 838

27:18Yeah. So, um, this, uh, nutritionist in California, this guy, Chris Kresser tweeted, like, this is an interesting, you know, I've told you to eat grass-fed beef. This is an interesting place to get it. That's all he did. And we saw a flurry of activity from that. And by flurry, I mean there was like seven people who signed up. But at the time, that was like, holy, what just happened? And then we were like, to what you were just talking about, we're like, we need to do more of that. We need to go find every influencer who's ever talked about grass-fed beef and get them to promote us. So we finished the Kickstarter.

27:54And then we immediately... And that was the CTA. So when you're pushing out to them saying, hey, promote our Kickstarter, basically, and they could send their traffic to your Kickstarter to, you know, the seven buyers that came in from that. Yeah. Is that how that's how the money came in? Yeah. Well, so Kickstarter will tell you, like, where did this come from? So it came from Twitter. So that was but you were still in presale mode for this whole thing. Yeah. OK. Yeah. Great. Because we want it to be capital efficient. The whole idea was we're going to send you the butcher selections. OK. Right.

28:25So I didn't want to hold inventory because I don't know how many ribeyes we're going to sell. And this is really expensive inventory. So the idea was we'll sell a bunch of stuff and then we'll just decide what to put in the box. Yeah. So we sold a bunch of stuff and then it was like, okay, we have 1 ,100 boxes. We talked to the place that we were working with. They created, you know, these different. Did they have all types of meat? The one place that you went to? They did. Wow, that was fortunate. Yeah. We started working with this company in Wisconsin that did, they had a cutting facility and a pick pack ship facility.

28:53It was like they did everything. So they just had it and they had no marketing basically. Yeah. Yeah. And so we shipped out all these boxes and then called everybody. We shipped them out really quickly. It was like a week. They were thrilled for Kickstarter. Yeah. Wow. I got my box already. And then we called them. Hey, how are things going? Do you need any recipes? Would you like to become a subscriber? Yeah. And signed up like 40 % of the people. Amazing. So right away we had like. Well, you didn't just send an email to 1100 people. but wouldn't that have been easier? Nope. We had a guy, Nicky Graham, who picked up the phone and just like pounded the phone.

29:29And he was like$10 an hour plus like a$5 spiff. I just want to hit on this just because like, what's nice is that you're hitting all these really clear milestones that I feel like are just forgotten, which is like just the elbow grease of what I'll consider like unscalable work or unscalable effort is like a lot of times early on, everyone's looking for like, I don't know if that scales. It's like, well, I mean, you know, we hand wrote, you know, 1 ,100 cards and we manually reached out to every single person and we had conversations with them and we asked them if they knew anybody else would be interested.

29:59Just like the basics, everyone's like, oh, I'm sure that would work. It's like, right, but it would just be work. And you did it and obviously it worked. Yeah. Well, and one thing that I think is important is I knew that I couldn't do that. Like if you put me in a room with a phone and said, call 1 ,100 people, no way, like the business wouldn't have gone anywhere. And so it's good to know what you're good at and what you're not good at, what you're willing to do, what you're not willing to do, and invest in the areas that you're not willing to do. Because if you believe in the business, there's a guy who for$10 an hour is just like, okay, we'll just get, yeah, he's thrilled.

30:33And he was good at it. And like, then I didn't have to do it. But I think too often entrepreneurs take the approach of like, they need to do everything. And like, I mean, the business would not exist if we hadn't made those phone calls. But if it was up to me, I would never make those phone calls. Was there an offer that you gave them for the subscription, the 40 %? Aside to like, hey, want to sign up? I don't remember. Like get your next box,$10 off your next box, or you get bacon for free in your next box if you subscribe. There must have been, but I don't actually remember. But what did happen was we launched ButcherBox.com.

31:10So in the background, we signed up these people, and we realized affiliates was a thing, so we started working on that. We launched butcherbox.com to the world. And there were many people who were trying to get in on the Kickstarter and they let you put up a link. So they were coming to our website and they were buying. So right away we signed up like five subscribers, 10 subscribers, like on the first day. And what happened was we had a little tech issue. So when those new subscribers signed up, they got free bacon in their first box because we built the tech to be like bacon's going in every first box.

31:46and two weeks in i get a call from the tech guys they're like we have a really bad problem on our hands i was like what's going on they're like we've been sending bacon to everybody and i was like oh my god this is bad and then uh my marketing guy was like why don't we just tell people sign up and get free bacon and it was like oh well we can't shut it off anyway so let's do that it's broken like we can't fix it so we're just gonna that became the that became because i know that one and like i knew that before even like heard or met you or heard the story from harley and whatnot um so i again like grand slam offers like and and you know the free box of bacon like i knew i've heard of that yeah um and so sometimes it started with get bacon in your box and then uh two years in we created this bacon for life offer yes and that really took off that that was like that was a ripper um so you just one-upped an already really good offer and said not only do you get it in the first box, you'll get it in every box as long as you stay subscribed.

32:43As long as you stay a subscriber. And, you know, ultimately the bacon costs$4 and the box, you know, you're making your profit off of. So it's like, you're, it's not that big of a deal. And you definitely acquire customers for less than four, like the arbitrage on CAC or, you know, CPA, depending on what industry you're in. Yeah. Cost of required customers significantly higher by basically said differently. If you add bacon for life in your cost of required customer drops by more than the cost of the bacon. More importantly, they stayed longer. Really? Yeah. Oh. Because now you have your free bacon.

33:13You don't want to get rid of your free bacon. And so they can't come back. Well, now you can't. If you quit, you lose your for life offers. But we've built a whole thing around these for life offers. Our top people have been with us from the beginning of like six or seven for life offers that they get every month. They're like, why would I ever go anywhere else to buy my meat? Like I have all these for life. Talk to me more about this because it's really interesting. So how can they stack multiple for life offers? Like if I'm one of the 40%, right? So I signed up on my subscription and I still have the tech malfunction.

33:46So I get free bacon every month. Okay. How am I getting these other ones? Well, so pretty soon after, I mean, this is several years in, this was like, you know, we're fast forwarding like five or six years. We started offering like, okay, free bacon for life is kind of getting overused. Let's try ground beef for life. And then people were signing up on ground beef for life. but then our customers our current customers are like what the hell like i want ground beef for life so then we just started selling ground beef for life to our customers so we're like okay for fifty dollars we'll sell you one time ground yeah ground beef for life so we just stacked all of these like offers on top of each other um very few people so your gross margins went down on some of those people but like they never they're just they're just the base that just like never.

34:33We've gotten smarter at being like, it's for a year. It's for life. And it's like, we've gotten a lot smarter and you lose them if you leave. And like, but yeah, Bacon really built this. We built this business on Bacon. So there's one channel. Well, I'll just say, yeah, there's the influencer channel, which we can talk about. The other thing that, so it went Kickstarter, arbitrage, influencer arbitrage, and then Facebook video arbitrage. Okay. Because I want to talk about, I'm guessing paid ads became the next like big thing. Yes. After influencer. Yeah. So how long did you do influencer? So, okay, I'm going to retrace the steps real quick.

35:11So we had Kickstarter and then you officially opened the site. Kickstarter had a backlink to you so that people would go to the Kickstarter because they've got SEO and good rankings, whatever. And so then they'd find you. You started getting sales every day. You have your mess up on bacon, but you're like, you know what? Screw it. Let's give everybody bacon. and so the influencer strategy worked well for the Kickstarter so you kind of doubled down on that and say how do we get every influencer on the planet to talk about ButcherBox? Yes. So did you go like Instagram, Twitter like you just went across the different channels for influencers?

35:38No, so what we did was we figured out that there's a company Thrive Market they're a big like online Thrive had done this thing where they had all these influencers and they gave a lot of them equity in the company to like actively promote Thrive. They were like kind of the first ones to unlock Influencer. Okay. And so first we reached out to like everyone who mentioned Grass-Fed Beef. And then we realized that there's like a lot more people in health and wellness. And so we like Thrive Market's URL was like slash partner slash one. And then slash two slash three. And so we just like concatenated all the URLs and just like took every single person.

36:22and then found their website and their contact information. Oh, so you didn't go to Thrive. You just reverse engineered Thrive. We reverse engineered all their influencers, got a lead list of 400 people. And then I think you'll like this part. I like that part. That's a good one. That's a good way to get your warm leads. How I got my first leads for gym launch was paid a VA to go to CrossFit's website. Sorry, CrossFit. And literally look up every single affiliate box that they had. Yep. And so because, and gym owners usually put their personal cell phone number to their personal email as their actual like a thing on the, on the CrossFit side, but they wanted to get listed because they're paying$3 ,000 a year to get the listing of saying I'm an official CrossFit.

37:04But for me, I got like, at the time, this is super early, you know, we had like 1600 names on this list, but it was enough for Facebook to make a lookalike audience off of that. And that single lookalike audience is like what built gym lunch. Like I didn't, like I tried to hit all these different audiences and nothing worked. And as soon as I hit the ads, that audience, it was like, ding, ding, ding. I was like, oh, my God. This is works. Amazing. Amazing. So you reverse engineered your list. Also, elbow grease for both of these, right? You just looked at the site, looked at the directories, and manually, like, pasted stuff over.

37:32Yeah. But again, you know, like, you used a VA. I used a VA as well. I used somebody in the Philippines who, for, like, 20 cents a record, is just like, here you go. And you sleep, and it's, like, there the next day. Exactly. So the way that we reached out to these influencers I thought was pretty genius. So we had this box, right? We're shipping a box of meat. And at the time, there was like Blue Apron and HelloFresh and all these companies. And they all include - No, Blue Apron's gone, right? Or they're - 2015, they were hot. Yeah, I remember that. Yeah. Blue Apron is now, was purchased by Mark Laurie, who did Jet.com.

38:06And they're trying to like make it or something. And then HelloFresh was a darling a little later than that. Yes. And HelloFresh is still around. They are, okay. Yeah, I'm not right. So at the time, Blue Apron and HelloFresh would include a recipe in the box. Okay. And our customers were like, this is really great, but I'd love a recipe. And so what we did is we reached out to these influencers and we're like, hey, we started this company on grass-fed beef because we believed in like eating grass-fed beef. And you've talked about grass-fed beef, but we didn't see a source of where to buy it. So we'd like to be that source.

38:41And by the way, we're shipping out all these boxes and we don't have any recipes. and what we'd like to do is include your recipe on and the va would like you know find taco bowl yeah steak whatever and we we'd love to include that in our box and so these influencers who like trade on influence are like of course yeah use my recipe no problem are you gonna like link to my website and all that stuff we're like yeah yeah they're like by the way what's butcher box and we're like perfect let's talk so that was like that was like we called it the trojan horse because Because it was like, not only do you get the recipes for free, but you also get, you know, you get in contact with all these, you get them to reply to you.

39:21And as soon as they replied to us, then it was like, let's talk about ButcherBox. So I want to double click on that real quick. So if you're dealing with influencers, you have to think about the currency they care about most. And a lot of influencers care more about fame than they do about money. And so you were able to deal in the currency they preferred. So just as like for any businesses, like, is there a way that we can do this that's realistic, that like actually provides real value to them in the way that they want to get value? Which I think is actually like a really brilliant like little nugget.

39:49This is 2016. So this is a long time ago. At the time, the influencers, especially in the health and wellness space, like didn't really know their value. Yeah. And so we were able to go to those influencers and say, look, like we don't have any money. We can't pay you up front. I'm not paying you like$5 ,000 to send an email. What we can do is we'll pay you$10 or$15 per subscriber for every month that they remain a subscriber. So for life. Yeah, that's great. Baking for life? Yeah. Commissions for life. Commissions for life. And people said yes. They started, yeah, I'll do that. I'll do that. And so we figured out that, you know, tweets didn't work.

40:28Facebook posts didn't work. the thing that worked was a dedicated email blast where they would be like here's butcher box let me introduce this to you and then ideally with a last chance like a last chance thing and there was always an offer twenty dollars off free bacon whatever it was and because we're only paying these influencers ten dollars or fifteen dollars a month um we could do all of this and be box one profitable meaning we still made money because we started with a twenty dollar profit we still made money on that first box or at least it was like we made a penny is the is the so i want let's talk about now that we're here let's talk about the box economics yeah so you're profitable on box one which if we're juxtaposing this with uh custom made yeah right um i i always fundament like there are some business it's basically i think there are significantly fewer businesses that actually rely on outside capital to to work than people like if you want to build rockets it's probably tough, right?

41:25Like you probably have to do that. But so I see a lot of businesses that, like even that, that hit me up and they're like, Hey, you know, I'm raising capital for my insert normal business. And I'm like, have you considered just making money? Right. No, but like, right. It's just like the perspective. Right. And so box when you're profitable. So walk me through like with the, the standard box, like that most people, you know, what the cost is and, and all the costs associated. I know you're really obsessed about the box? Yeah. So, um, the Omaha stakes guy who introduced us to the place in Wisconsin that we worked with, it's massive by the way, the one nugget.

41:59And yeah, he like opened the whole business. That's why I was like, I need to start now. Um, the one nugget he left me with, he's like, listen, all we care about at Omaha stakes is dollars per box. I was like, what does that mean? He means everyone at the company knows when a box comes off the line, how much money are we making off the box. And so that's how I built the business. I started the business, right? So we were charging$129. We were trying to make a$20 profit. We were only shipping from Wisconsin, which is a nightmare for California. But it was like, so we were losing money on California, but we're like, whatever.

42:33It averages out to 20. Hey guys, real quick. This podcast only grows from word of mouth. Quite literally. There's no other way to grow podcasts than word of mouth. If there's some element of this that you think somebody else should hear or would be relevant to them. It would mean the world to me if you shared this via text, via Instagram, via DM, via whatever way you like to share stuff with the people you love. Thank you. And it kept our focus. So like when I, and when I talk about$20 a box, I mean, like all in because we put all the costs associated with it in. So you like fully loaded the box in terms of cost.

43:05So it was$20 of net profit rather than gross profit per box. Or are we saying gross profit per box? Gross profit. Okay. Got it. Because we, again, it was hobby business. So it wasn't our labor. It wasn't our. So this is pick pack. So putting all the stuff from our distribution center into a box. The cost of the meat. The cost of the box. The cost to ship the box. The cost of the dry ice that goes in the box. The credit card processing fees. The tape that goes on the box. All of those things. And because we just became doggedly focused on dollars per box. And what I love about this business, even to this day, is that we get to focus on the minutia, like negotiating the price of tape.

43:50And they're super creative, like how are we going to get our next 500 ,000 customers? And we get to do both. But we just started with a DNA of like we're going to negotiate every single line item in this box. So what is the gross margin percentage per box? Currently or then? Oh, well, both. Sure. Like 30 %? is a healthy gross margin. Yeah. We definitely want to be around or above 30%. Got it. One of the challenges that we have as a business is that at least currently, so we're looking at pricing model change. Currently, you pay$169 and you choose six items in the box. Okay. And so it's kind of an inflationary disaster because the prices of meat fluctuate all the time.

44:33So if you stack it with ribeyes, you're way less than a 30 % gross margin. if you stack it with really cheap stuff you're way more than a 30 gross margin that's an area where um i feel like we're in like not in alignment with our customer so i want to change that over time yeah uh but yeah currently we're looking at 30 so what are net margins they're like six okay got it got it we did like six and a half last year it's certainly not a content business very Yeah, yeah, it's different. Yeah, yeah, yeah. We used six and a half, what, million? Oh, yeah, percent. I was like, that is it. Okay, that was, that was, that's making sure.

45:10And you did. And the big, the big line item. So, um, these businesses, like I've, I've seen so many of them, uh, 30 % gross margin. Yeah. Um, you got 10 % to operate the place. That's salaries, uh, technology. So a third goes to ops of your gross margin. Yeah. Uh, and then you got 20 % leftover for marketing and EBITDA later in profit. right and so uh these businesses at scale what they do what you do is you market market market market market for years build your name and then just try to collapse your marketing and take it and hopefully get enough word of mouth you know from from those customers that it can at least stave off churn yeah that's the like the cpg playbook um and that's what a lot of these companies are doing it's a tough business it is a tough business like it's i mean and it's so it's interesting because in so many ways it's like software yeah with the exception of like rather than dealing with development you're dealing with supply chain that's your big like i said like i'm sure i know there's more fires but like if i had if i had to simplify it into like the big buckets most of the time i feel like that's where um why don't you tell me oh that that's yeah no i i agree i mean so um you know that was a blue aprons whole thing that raised a whole bunch of money and it was all like we're we should be valued at a software multiple yeah nowadays box subscription companies are not valued as software multiple because there's like actual physical product being sold um and i don't think stick is as high um as like a i don't know well a consumer a consumer tech company like shopper for example they have 60 annual uh retention for like new new customers right um i would imagine that if if that in the consumables business that that would be unbelievably good yeah yeah what's your retention on like a year one customer gosh it's not how we look at it.

47:01Okay, interesting. Yeah, probably around 60%, 70%. Yeah, that's like, I mean, those are like best in class numbers. I mean, there's a reason that you're doing. Yeah, yeah, yeah. Is it 600 now that you guys are doing? Yeah, well, it's like 550. Okay. Yeah, the 600 has been out there, but it's really 550. So yeah, we're, yeah, 550 million profitable since day one. And you own 70 %? Yeah, so I gave equity to most employees, like early on. Like a software company. And then, yeah, like a venture-backed one. I was like, oh, this is what you do. You give out equity, which - Are you happy about that? In many ways, yes.

47:37Like the people who helped me build this business, the people who helped me hack through the jungle are all millionaires. And, you know, that's cool. That's like really neat. But also we have, if you don't want to raise money, which I don't, and you don't want to go public, which I don't, And you don't want to sell, which I don't. It's like, how do you cash people out? Yeah, right. That has been, that is a concern of mine all the time. It's like, so every year we've actually done a, we've taken profits and repurchased shares. Got it. So that people have an escape valve. For anybody who wants it.

48:14Yeah. And so then you basically set the valuation every year. Actually, we do, yeah. We, there's a, there's a 409A value. Somebody comes in and does a valuation. Yeah. We also have done this thing, which is, I don't know if your listeners are interested, but we've done this thing this year, which is a reverse Dutch auction. Okay. So we are like, we're going to allocate this much money to buy shares. And then we, people can say what they're willing to sell at. And then we, we bought them that way, which is pretty interesting. That's awesome. Yeah. That's very interesting. Yeah. I was right. It's a really, it's actually more common now.

48:46And it's a really great way to get like what the actual market value is. Cause when you do evaluation, it's like not. It's a dude who makes it up. Who knows? Yeah. So, yeah. So I mean, you know, just on that point uh what did you what was the reverse dutch auction valuation of the business it was like 50 of the what the um 498 was what was the 49a they have one valuation and then they do this control premium that they take off but the the valuation is about a one one for one with revenues okay so like 1x okay got it uh which is probably low uh who knows i mean it doesn't matter Yeah, because you're not trying to sell it.

49:24Yeah. One for one with revenues is what people - Yeah, I will give$1 so that you have a trillion dollar valuation. Yeah, exactly. I owe 0.0000%. Thank you. Yeah, so the 30 % that other people own, it's a$150 million problem. That's - Yeah. It's a big problem. Yeah, yeah. Do you see it as a problem? I don't. I mean, you have to get comfortable with telling people to be patient. Right. Right? It's like, look, we're not going to spend$150 million here. No, this is super relevant for me. Yeah. And, you know, so during COVID, COVID was, we grew the business tremendously and we almost shut off marketing.

50:02So, I mean, we just made so much profit. And then we bought all these shares and we just started buying and buying and buying. But then inflation took over. And so our inflationary disaster, like our margins just got super compressed. We went from like a 30 % gross margin to a 25 % gross margin after doing two price increases. After two's. So it was like there was no money. Yeah. And we never like ran out of money. But, you know, we're all looking around being like, dude, we just like did a share buyback like for 20 or 30 million dollars over the past like three years. I'd really love that money right now.

50:35Yeah. That'd be nice. So like, hey, can I? Yeah. No Indian universe. We take that back. Do you want some shares? Yeah. All right. Well, did you, so with, so this is a great follow up question. So do you take regular distributions from the company or have you just been like, kind of like you took once or twice and that's like my, you know, my family set and now everything's still like. Me personally. Yeah, yeah. I take a salary. Okay. And a bonus. And then very early on, because we started as an LLC, I owned all of the technology and employed everybody. Okay. And the company bought that from me.

51:10Got it. And so there's been distributions to cover that. And you controlled both companies. So you got to pick what that was valued at. That had to be third party. Oh, was it? Okay. Got to be fair to the show. Because it's not all you, right? Yeah. Yeah, yeah. Okay. So when you've been doing the buybacks, were you at like 50-50? And then over time, you've kind of like bought your way back to 70-30? Yeah, I think it was like 60. And now it's... Well, originally, the Omaha Steaks guy, and there was also a brand guy. my biggest mistake when I started the company was I valued the company at a stupidly low rate.

51:48And so I had just raised$10 million on a$30 million valuation. I started this and I'm like, it's going to be a hobby. This isn't going to be anything. So the Omaha States guy is like, I can make all these connections. I can do all this stuff. And it's a$75 ,000 worth of work. And I'm like, well, I don't have that. So it could be equity. And he's like, okay, great. How much is the company worth? I was like 750 grand. So he took 10 % of the company. So he's a 10 % stakeholder. Not anymore. I bought him out. And then there was a brand guy, which was the same thing, 10 % of the company. And as we got going, I was like, that's like way too much.

52:21And they're not doing anything. Right. They did one-time work. It's like one-time work. Right. And so we bought them out. We bought them out when the valuation was$48 million. Well, I'm sure they were thrilled. And it was, yeah, they got$200 ,000 a month for two years. Okay. I'm sure he was still thrilled. Yeah. Right. Probably more than he made at Omaha. Totally. Yeah. Way more. One good phone call for him. Yep. A little bit of work. Yeah. Except for life. Man, there's so many directions I want to go. But to put a button on the story, and then I want to go back and kind of unpack some numbers and things like that.

52:56Yeah, yeah, yeah. If you're not going to IPO, and you're not going to sell the company, and the CPG playbook is that at some point you turn off the marketing, when is that? Yeah. Not anytime soon. Okay. So you just want to keep growing for a minute. Yeah. So. Do you have a goal, like a billion a year in sales? I mean, a billion, I'm very goal oriented. So I do have a billion on my whiteboard, but I recognize that before that I had a million and before that I had 10 million and then a hundred million. So it's just like. A billion will be enough for sure. Yeah. Totally. Then it'll be enough. Then I'll just lay down my arms and walk away.

53:33And then you'll be happy. You know, I'm just messing around. Yep. Exactly. I would like, I think running this to a billion in revenue would be a lot of fun. I don't know how fast that's going to be. We've definitely learned that it's gotten a lot harder. Like as you grow, you just lose more people and, you know, it's just harder. Yeah, 1 % on, how many customers do you have right now? Like 430 ,000. Yeah, so 1 % on 430 ,000. It's like, oh, all of a sudden that's just, you know, 4 ,300 customers that we just have. If we lose 1%, it's like, okay, that's a decent amount of customers. and you're like, well, if it's 10 % churn annually, and you said, I think you were keeping, well, 60 of your one or something like that.

54:10No, I mean, our churn is like 3 % a month. Right. So that's 30-ish percent or whatever. It means you have to sign up 12 ,000 people a month before you stop treading water. Just to chill. Yeah. Yeah. So it's like, those numbers just get bigger. It's 400 a day. Yeah. Just like, they're leaving. They're leaving. Yeah. They're leaving. They're falling out. Don't leave people. We have a great product. You have bacon for life. What are we talking about? Yeah, you're losing your for life offers. I really do love the lifetime offers. Yeah. I have a book that's coming out that talks about this particular offer structure.

54:45Yeah. A lot of fun. Yeah, lifetime offer. People getting a box of meat seemed really magical. Like, I was like, wait, this is going to show up. It's going to be frozen. I don't trust it. So money back guarantee, like no questions asked. We'll just refund you. Let me talk to some of the fears of business owners around money back guarantees, because I talk about them a lot too. What percentage of customers do you get who ask for refunds on like a monthly basis? Oh gosh, I don't even, like so small I don't even know the number. Right, and the conversion increase is certainly worth having. For sure, for sure.

55:17Also like, you know, one of our core values is being customer obsessed. Like we actually want to deliver you an amazing product, right? And so if we fail at that, you should get your money back. That's like, and it's like, well, I'm worried about that. That will fix your product. Make your product better. Spend time obsessing over your product. And you'll do very well with money back. It's like dollar per box and then also like happiness per box. On the customer side, like your delight per box. Totally. Yeah. I mean, it's all about your, well, the metric that is commonly used is the net promoter score.

55:52So it's all about your satisfaction with the, and we're constantly asking. What's your NPS right now? It's like a 63. That's great. Yeah. Yeah. We're pretty happy with that. We want a perfect experience every time. Yeah. And when you're shipping multiple species, you know, you have 12 to 15 skews. Do you fish now? Yeah, we do seafood. How did that, how did you get, was that just a whole nother, have to find another supplier? Yeah, I mean, we don't use any of that. So basically, we got going. We'll go all the way back. We got going. We're shipping out boxes. We're making$20 a box. The influencer thing is working.

56:26Then we get to about 6 ,000 subscribers. Oh, God. and it was clear to me that we had no idea what we were doing it was like okay we've been faking it that's great but like we need somebody who knows how to buy an adult we need an adult right there um and so again i went to linkedin usually while on the toilet uh and i reached out to um this guy who lived in boston and um ran meat and seafood at one of these big grocery chains but he had retired and so i was like interesting background let's talk yeah pull them out of retirement and he came and started purchasing yeah meat and seafood for us meat and then seafood and i mean the saving my whole thing was okay we're shipping 60 000 pounds of meat i've got all i have to believe is that somebody can save me like 25 cents a pound and this is like worth it right so um he came in and just he's like you guys are paying there's like second day he's like you guys are paying enough in chicken breast that you could send people three pounds instead of one pound you want me to do that and i'm like yeah yeah that'd be great that'd be good yeah 25 cents was the target and he was like i can give you a buck and a half yeah like total yeah i mean multiples of his of his salary back um and you know i think it's really important to that you hire experts in certain areas at the right time, but in certain areas.

57:48I want to, so I want to, I want to hit on, on the meta part of this, which is like, all right, like the big, the big turning points. Cause I like, I like, like, what are those, those inflection points in the business? So it's like, all right, you switch from raising money to pre-selling. That's probably, I feel like that's like setting yourself up on the right path. Okay. So that was number one. Number two, um, is you realize this influencer thing has some legs to it. And then you go hardcore on getting influencers. You also reverse engineer somebody else's database, which I highly recommend if you're trying to reach out to people, to find the high, like I call them HVTs, but high value targets.

58:21Like how do we find the HVTs and then grab them? Okay. So you do that. You have a happy accident with free bacon that ends up being a core component of the offer. And then later you turn on the lifetime version of that. And then you do that across kind of horizontally across the box. You obsess about gross margin per box. So whatever your unit economics are of the business, you got super dot on that and just want to make every single key, every single penny count because, you know, you're on the same side of the table figuratively as the customer. You got experts, um, in at the right times, the branding person up front, the Omaha steaks guy, later the meat purchasing guy, um, that all came in at key points to like unlock, you know, levels of profitability and growth.

59:03What's, what What are some of the other ones that might have been skipped over? Jeez, man, that's good. Just like boil it down in a good way. I think working like so our backbone today, we still don't own our backbone. So distribution, we don't do. We don't own our own farms. We don't own our own. Do you want to? No. Okay. Because we believe that it's better to work with partners. It's kind of like the Toyota approach. Work with partners. Hold them, hold their feet to the fire. Hold them to a tight spec. have them do things they're not doing for anyone else, but trust that they know better than me.

59:38I don't know anything about farming. I don't know anything about slaughterhouses. That's a bad place for me to spend my time. The only piece of our entire backbone that we control is dry ice. We have two dry ice plants. And that's because if you don't have dry ice, you can't ship a box. And so we were like, it's like a great insurance policy. Everything else - Because if you lose that, revenue goes to zero. Yeah. everything else is like not um i don't think it's worth us us taking and so and i think that's like one common mistake in box subscription companies in overfunded companies and just with the entrepreneurs in general vertically integrate bro yeah you need to you need to like own everything you need to control all of it and uh that has been a huge it's actually been a huge um part of our success well then let's so because i'm sure you've had partnerships that didn't go well yep and you've obviously been really good at building these relationships so to the greatest degree possible do you have any kind of test for how you

1:00:48Yeah.

1:01:03So, I mean, on the meat side, we do robust safety audits. and you like, we're not working with you unless we've done a whole bunch of audits. On the other partner side, we're generally trying to work with the best people, like best in class. So you just look at an industry and say, okay, we want to find, okay, so of all the different farms in the U.S. that are grass fed, who's the biggest and the best? And you just try and do a deal with them? Yeah, I mean, you try to balance like helping small farmers, right? And working with big farmers because a small farmer might have 50 head and we might need like 100 ,000 head, right?

1:01:39So we can't work with 2 ,000 small farmers. We generally work with collectives that then work with the farmers. So we're working with that collective saying, this is what we want, this is our spec, this is how we want to raise, and then they go and find the farmers. And again, it's like, we don't want to be on the ground. You know, I love meeting with farmers and doing all that, but like that can't be what we do full-time. Inspecting hoax is probably not the error. So it's like really important to know what you're good at and what you're not good at. And anything that you're not good at, including picking up the phone 1100 times, like just don't do.

1:02:15Try to get someone else to do it because you can't. I don't think you can build a business unless you're feeling that flow and you're feeling like really engaged. And that can only be done in the work that you're really good at. You've been really good at picking those people, though. So like what's your obviously there's the reputation of the company. Yeah. Right. But like also you're really good at picking like the Omaha Steaks guy and the branding guy that you picked out. And even Nick, who did those first, you know, 1100 calls, like it's, it's an uncanny trait. Like you've been really good at it.

1:02:42Just, I'm just like listening to the story. I haven't, you haven't mentioned, I'm sure there were some horror stories, but like, it seems like you've had a huge amount of success. And I feel like if I had had a different entrepreneur in the chair, I would have, I could, I could totally hear the total other side of the story. I went to a couple of partners early. And what I learned is you got to control everything. If you want, you know, like I've, you didn't mean like I've heard that side. And so you're obviously better at picking partners than most people. So like, what do you think about in trying to isolate?

1:03:10Like this person will work. I mean, so early on when you're talking about your first employees, I have this analogy. I think I stole it from someone, but like building a company is like hacking through the jungle with machetes. And so you're just like there's you just dropped in the middle of the jungle. You have a machete. You're like, I don't know where we're going. At that point, you need people who are just going to hack day and night with you. Like you just and it's grit. So I'm looking for athletes. I'm looking for people who have failed at something. I'm looking for people with a chip on their shoulder, you know, daddy issues, all of that.

1:03:44Because I've got all that. So, you know, I want to, you know. As all great men do. That's the type of person I want. And then as you grow, you realize that like, OK, we need some experience here. And how do we get experience? One thing, this doesn't totally answer your question, but one thing that we did that was like, I think pretty, I thought was pretty smart is I call it the barbell strategy. We hired people like out of retirement because they were so far along in their career. And we found that the middle, like so really young and really old worked incredibly well. I would say personally, I've had a lot of experience with that too.

1:04:22Yeah. And the middle is like, they're super busy. They've got kids. They've got all these commitments. They want this to be like the one mark on their career. Yeah, the one career. The careerists rather than people who want to do the work. Hunger, hunger. Yeah. It's interesting because the people in the very beginning want to work all the time because they want to learn a lot. The people at the end want to work because they have nothing else to do. And they want to, in some ways, like have their experience be used. Like they want to be useful. Right. And that both of those are actually concentrated on the work itself rather than the label ascribed to the work.

1:04:52And everyone, a lot of times people in the middle are, it's like, you're three years on my resume. Uh, and I want to, you know, just leverage this brand name. I need to go from director to VP and then I need this and I need this. And, and yeah, we just found that people on the ends were just like so grateful. And, and so like my meat guy. Title obsession. Yeah. Yeah. I hate it. My meat guy. I just remember this, uh, dinner I was at and it's like, I, my meat guy and a blue aprons meat guy was there and blue aprons meat guys like 32 years old and like skinny jeans and a nice best. and my meat guy's this grizzled 65-year-old.

1:05:27It's like, who do you think is buying chicken for cheaper? Yeah. Like, my guy looks like meat. Yeah, yeah, yeah. I mean, so I don't really know what's happened here. I like to say the business wanted to be something way bigger than I expected. And I just honor that as like some of these people just kind of fell into my lap. but I definitely my first company I knew people were off culture and I hired them anyway and this time around we wrote down our core values and we're like okay this is what we're this is what we're hiring for one of our core values is relentless improvement and to your question about partners any partner you work with there's going to be problems and we're just not afraid to talk about them we do quarterly business reviews we're like you know auditing We're doing a whole bunch of stuff and telling you what you're doing wrong so you can fix it.

1:06:22Because most partners don't want to like just. They want to fire the relationship or not talk to you. It's like, no, let's just keep getting better. Yeah, let's just get better. Like we want to lock arms with you and get you better. And so we're also, because we're trying to build a long-term thing, like we're just locking arms with partners and trying to just move forward with them. Talk to me. So given the growth rate that you had, so it was like, was it, it was like 5 million was the first, like, or second year, I think, of business, right? Yeah, so we started in September of 2015, and we did like 200 in the Kickstarter.

1:06:51We did like 500 grand. And then we did$5 million, and then$33 million, and then$105 million,$220 million. Then COVID hit, we went to$450 million. And then you had what, like 500-ish the next year? $450 million,$550 million,$550 million,$570 million. And then two years ago, so 2023, we went down for the first year. Okay. which was pretty heartbreaking for a team that you know prides themselves on growth so talk to me so yeah and then last year we started growing again okay that's good so i have two follow-ups so first one is talk to me about rush like what's your because like you grew really fast yep and then you were essentially flat for like basically four years yeah how does your perspective on where you want to take the company affect how you run the company with regards to growth's rate yeah And like rush around goals.

1:07:42Yeah. I like talking about a rush a lot because I think it's where all mistakes happen. And you grew really fast without the intention of growing really fast. Yeah. Which I find has happened to me multiple times. Yeah. You know, I think that we, so we grew, obviously we grew incredibly quickly. um the biggest mistake that we made the biggest rush that we made was we it um the wheels kind of felt like they were falling off the bus at like 450 and we decided to bring in a whole bunch of people to help like fix the wheels we need bodies we need bodies we need bodies and we need managers yeah we need people in the middle the middle right yeah what was headcount just so i have context what was headcount at that at like i mean going into cover we're 85 people uh so doing 200 going into covid with a headcount of 80 yeah it's great and then uh coming like uh end of 21 we're at like two like one maybe one 160 and then we got to a height of 240 yeah uh with designs on And, you know, we're going to be like 300 people.

1:08:57And now I'm like, you know what? Like 150 sounds really good. So, yeah, we currently have we have 25 associates in our drives facility and then like 170 people outside of that. And so the rush was we hired a lot of people. And what happens to companies and apparently I've learned now that this is a classic$500 million trap. So you can add a book to your thing later. the 500 million dollar trap is something bad happens you hire a bunch of people because you don't know enough and everyone starts saying no no and you go from um capital e entrepreneurship like a bunch of pirates like very little process we're just going and growing and like to like oh we need we need process like we need capital p process and entrepreneurship needs to come way down here and that's what happened you guys are a bunch of kids you're a bunch of kids like you mike are like you know have all these ideas and like we need to corral you and um and that's what happened and at the meantime i broke my arm like my everything in my life kind of fell apart at the same time and uh it was it was a slog uh and i'm i'm really proud like last year we grew like six percent and i'm like fuck yeah like we'll take it yeah um and you know so sometime along the journey um i went from like this is a hobby to i'm gonna just flip this thing like let me build this up and sell it for a hundred million dollars and i went on a couple meetings and i was like it just doesn't feel right interesting and then i i just it just kind of over time came to me of um the meat industry is broken yeah uh animals are not being treated well in this country and that's like hurting the health of like people who are eating it and it's like i just wish there was a company that like wasn't funded had no one breathing down their neck who could just take the play the long ball yeah and just like this might take 25 years it might take 100 years but who cares like we're in it for the long run and then after a while it was like after pointing on everyone else who should be doing that it's like oh maybe that's me yeah um and so i have no idea if this is what's going to happen but the the plan is to build a multi-generational long-term hold um If you look at food companies in the U.S., many of them are family-controlled, multi-generational, long-term holds.

1:11:21And so that's kind of like, that's how I've built since the past few years. Yeah. While reinserting myself and becoming a pirate organization again. Does it feel better? Yes. Yeah. I mean, we did a lot of work in the middle layer. Like, a lot of directors, a lot of, yeah. Yeah, right. at our at our height we had 230 people and um 85 managers so like the average person had like one person underneath them i just equated to um like the restaurant worker where the receipt comes out and they grab it and they're like where's the chicken parm yeah on their phone like chicken par you know it's like dude what do you do all day yeah um and so we've done a lot of work and like retasking people and just making sure that people are in the right seats doing things doing things and uh it feels much better we're moving much quicker we're growing we're yeah so you're losing 12 000 customers a month yeah something like that yeah do you have any idea what the split is of new customers per month in terms of where the sources of customers come from and is there a an acquisition channel that you have not mentioned so far that has that major really contributes to that yeah so uh right now we're we're heavily on referral and heavily on meta those are like the two ads ads and refer like ads and referrals um what's the split uh we're like 30 referral okay uh and then i don't know what meta is because it's you know there's also organic and google and whatnot um say 30 meta and 20 organic affiliate all the other yeah influencers are 10 or whatever it is yeah um referral's been really interesting uh we now if you're a member you can uh refer a friend for a trial box and it costs 20 dollars um and we've just seen that work really well does the refer what does the referrer get uh nothing okay yeah We tried a whole bunch of different things.

1:13:26You get$50, you get this, you get that. What they like the most is giving their friends a box that's almost free. They just pay for shipping and handling. Oh, so like a free plus shipping, basically. So it's like boxes free, it's$20 for shipping and handling kind of thing? Yeah, exactly. Interesting. So that's another offer. Yep. And that's worked really well. You obviously get a lot of people who just get one box. They're like, sweet, free me, and then they cancel. But executed well, you see a lot of people stay, and then they just become great customers. And if you, yeah, if you like a referred customer is a better customer.

1:13:59And so we've really leaned into that as a program. Because it compounds at scale, which is why it's so great. Yeah, exactly. Yeah, we've shipped a box to 1.7 million, 1.75 million households in this country. And so at a certain point, you're like, how do we inspire those people to do the sales on our behalf rather than us trying to like, you know, retarget people on meta? Yeah. Yeah. So there's there's two two things that I wanted to get into. So one is the ad strategy. And second is, if I'm not mistaken, you guys did a media play, correct? Recently. Yeah. Yeah. I want to talk about that. I think that's really cool.

1:14:37So let's do media play first. OK. Yeah. Yeah. We bought a company called Truffle Shuffle. These two two guys. One's actually in Vegas. We're going to see him tonight for dinner. And they they raised money on Shark Tank. and during COVID, they decided that they were going to sell truffles direct to consumer, these little mushrooms that are hard to get. And then once they started selling truffles, they realized that no one knows how to cook them. And so they started doing these instructional videos. Yeah, you have my DiGiorno and I'm just putting my truffles on top. Exactly. People are like, what do I do with this?

1:15:08And that took off. And this is like COVID where - Everyone's at home trying recipes to support. All these corporations are trying to treat their staff well and give them stuff and whatnot so so they they ran a pretty interesting business for a while great content thousands of classes where they're teaching people how to cook and live people live interest uh also recorded but live yeah um and they just like that they're experts at hosting a live class to cook yeah it's virtual virtual yeah our biggest challenge as a company if you look at our churn the people who are leaving, our biggest challenge as a company is how do I inspire you to take the meat out of your freezer?

1:15:52Yeah, they put it in there and then they're like, oh, I've got two months worth. Like, I don't need any. Right. And people think of their freezer as like a savings account rather than a, like, so when you say what's for dinner, you open your fridge and look inside or you look on your phone and order something. So how are we going to, like, inspire you? Well, one way to do that is if we do cooking classes. So we, you know, really liked the founders, Jason and Tyler, and just decided that it was a good fit. We got it for, you know, like a good price. And we ended up ingesting them. And so now we're doing cooking classes for our members.

1:16:26We're doing - And that's included in the subscription. Yeah, included in the subscription. Do you do, so how much of it is public and like available for people who are not buyers? We're trying to figure that out. Okay. Because I'm so, like - Yeah. Because I don't know how big of a media company in terms of like, you know, impressions they do. But like, because my whole, my, my whole, my whole business model around content is just demonstration, right? It's just like show, don't sell. Yeah. And then the selling will occur. Yeah. And so like whenever you have the opportunity, in my opinion, that's the, that's the most elegant, you know, way of, of selling.

1:16:58Yes. And so like these, you know, high-end chefs having these really engaged, high-end, you know what I mean? Obviously, they are relatable. They're high-end. Yeah. Um, I, cause on one level there's the retention piece, but I have this theory around the idea that this is this, I don't have a double blind placebo test here, but this is Alex's opinion. I think that you retain customers that pay for a subscription with free content that's available for everyone for a couple of reasons. Number one, a lot of people don't log into stuff. It's just like, you're not like, oh, I'm going to go log in. What's my password?

1:17:33And then it's already, it's already like gone. It doesn't, it's not going to happen. So the reason that I have like all my courses on my site are all free and also available with no login is for that purpose. And it's certainly been a significantly better thing than me trying to hide it behind even an opt-in wall just to collect people's emails. You can watch them. And then at the halfway point or whatever, it just says, hey, you can opt in if you want. You can also not opt in and keep watching the video. Yeah. And it's been exceptional for lead generation. And so the thing one is that I don't think a lot of people, I think the utilization is not as high as I would like it to be, even when you make these really high end things.

1:18:12The second is that it certainly doesn't drive. I think that you will drive more, not you, but like one, anybody can drive more sales with making the media available to everyone. It also makes it more shareable. And I think that spins the referral machine. You get the media machine from platforms. And that will drive top of funnel sales and awareness. And I think that maybe you put a handful of them behind a paywall if you want to as a membership benefit. I'd be curious to know if, because if we're thinking about like, how do we solve the problem? Sorry, this is me. Like, how do we solve the problem of the customers I have bank too much meat and don't cook it because they're not inspired enough to cook?

1:18:52So it's like, okay, so we want, we're trying to maximize on consumption in two ways. consumption of meat, but consumption of meat cooking so that it leads to consumption of meat, right? And so if you were to pre-educate, right, where people watch some show about some truffle meat dish and then purchase, they're purchasing with intention to make a specific dish. And I think it's almost like it colors them a different type of customer because their consumption experience was pre-framed with recipes versus I'm going to buy meat because this is good quality meat and it's a good deal and I'm getting free bacon.

1:19:30This is me just, I'm totally spitballing here. But when Harley told me that you bought that media business, that was immediately where I guessed or where I thought you were going. I was like, that's brilliant. Yeah, good. Push as much of that as humanly possible out, incorporate the product into everything, way more eyeballs come in. Existing customers still attribute the benefit of their subscription to the show because they're still going to consume the meat. Right. And so you still get the positive brand association, even if it's free for other people. And that was something that actually, like, I stumbled upon that.

1:20:08So, because I've had media businesses, right? And there's always this big fear in anything media related, especially if you have memberships and things behind paywalls, that what if I give away too much for free that I upset my paid customers? But in my experience, it hasn't been the case at all. One, because basically no one logs into anything. Big point number one. But secondarily, that I think the human brain has a very hard time attributing whether the content they watched was behind a paywall or not behind a paywall, I think we zoom out and say, has ButcherBox provided$129 of value to me this month?

1:20:51And you think about the one meal that you cooked, whether from a recipe that you found, whether it was your recipe that was behind a paywall and not in behind a paywall, or just that they saw on a cooking show and used your meat, right? That wasn't even associated with the truffle hustle. Is that what it was? Truffle shuffle. Truffle shuffle. Yeah. And so anyways, that's my - That's genius. two cents yeah that's more than two cents probably that was probably worth more than two cents i'll come back in a couple years and we'll you know i'll cross off the billion still won't be enough but uh yeah i mean that's um that that's the beauty of owning content is uh pushing it out more doing more with it serving our member but i think um that gives me a lot to think about in terms of like how are we pushing it to non-members because we've we've definitely been careful, we've been like, well, this should be a benefit for our members.

1:21:41Yeah. I would just, I'd be curious because I think that because there would be, because the math problem, right, is solvable of does the increase in conversion and retention on members with this added benefit, which I'm sure you've measured like now that we added in the box, has it measurably reduced churn or has it measurably increased conversion rate on the page, whatever, versus the amount of new customers that come in with first, second, third touchpoint via content. And my bet would be that you would, this is my bet, obviously, I don't know, but my bet would be that it'd be more on the top end.

1:22:15And then from the ads perspective, because I know you run a ton of advertising, I'm sure, it's like, I feel like that kind of content taking them, because if you have it public, then you can let the algorithm tell you which pieces are the fire, fire pieces of content. of the cooking and then push that out as top of funnel awareness ads, you know, retarget people who are at, you know, do 50%, 75%, whatever it is with now your conversion stuff, but they have positive brand sentiment because like now they're like, they're in, they're in the market. You know what I mean? They just consume this. They're literally, they were watched enough to be inspired.

1:22:50They were inspired enough to watch. And so now we just want to see if they're inspired enough to buy. Love it. Just love it. Yeah. There's a, there's a book called how brands market and what they've, what they found was they put up all these ads, like billboards and stuff trying to get new customers, but they found that it actually drove more repeat orders. Um, and so that's similar. Like if we, if we put out content to the, they'll be reminded to eat their meat. That's right. Right. I think it's brilliant. And I think that like, I'm really excited to see what you do with How long ago was the acquisition?

1:23:21We bought it in June of last year. Okay, so it's still pretty recent. We just launched a spice line with them. We've done a bunch of social content. But yeah, I think making more of it public would probably be a good thing. And so the last piece was the ad strategy for Facebook. So what's been your thinking process for generating probably the amount of creative, I'm assuming, I mean, you probably have to put out 50 pieces a day in order to maintain that kind of. And you probably have gotten a crash course on running ads if you're the CEO of this business. Yeah. So we've gone all sorts of different ways.

1:23:57We have had ad agencies work on our stuff. So buyer ads and, you know, update and whatnot. We've done in-house. We've gone back and forth. We're currently outsourced on our ad buying. So outsource media buyers. Who does the creative? They do as well. They do the creative too? We do sell them. We give them guidelines. But there you do it. The reason why was we weren't moving fast enough. So it has become, as you said, yeah, it's become a game of, it's like an arm's race. You got to like be changing your creative all the time. And we noticed that there were multiple, multiple, multiple meetings to like talk about and obsess about all these things.

1:24:36It was like, this isn't going to work. We can't do this. So we, you know, we've made a hard pivot. I imagine at some point we'll come, we'll be like, okay, we're paying way too much. we need to like do it in-house but the speed do they charge a percentage of ad spend yeah they do yeah but so when you're spending a lot that's a lot of money yeah um and that's baked into cac that's baked into the cac yeah yeah um have you you have you done multiple different agencies over time or is it we have i mean there's certain agencies that work well at a smaller size and certain ones that work at a bigger size uh we have we haven't been able to grow with like one agency okay um you've had multiple at yeah at different times uh where we've one right now it's not like you have four running we have one yeah got it okay because i had a buddy who had a really big company and he had four different agencies working at the same time and he was like yeah the world's big all i need all of them just fully focused and i was like are you worried about like crossover like well yeah and that was the kind of the response was just like well there's 300 million Americans.

1:25:40Yeah, there's a lot of Americans. I'm not giving them, no one's getting any other access besides like pixel traffic. And so they can make their own lookalikes off of whatever they think is going to convert. And if there is some overlap, there's probably overlap with 10 other thousand companies that are also advertising. And so it's more, because I think the deficit, like the constraint is more the creative power and mental bandwidth and attention and skill than really anything else. And so like one team, and you probably know this from the companies, or at least you've experienced this the same way I have.

1:26:12There's this law, I can't remember what it is, Tom Billy talked about it, but basically the square root of every company does 50 % of the value creation. So it's like, if you have 100 employees, 10 people do 50 % of the value creation. And I thought about it, I was like, that sounds about right in terms of where's the contribution towards revenue and all that kind of stuff. And so when you think about that from the agency owner perspective it's like i'm getting these four really good people from this agency on my stuff but i also want the four really good people from this company and the four really good people from this company so it was just like a interesting this you had you've had one agency that runs all of it they're doing i can't believe they're doing really everything so how like they're going out we do some stuff internally yeah but they're going to like so they're like going to farms and capturing stuff no we have all that b-roll like because we have b-roll we have all that um So they're not really taking any, they're not going all the way to shooting.

1:27:05We have all that content. And yeah, I mean, I think Facebook has been a wild place for the past few years. It's like either working really well or not working at all. We've also had more competitors come into our space. HelloFresh launched a company that is like - HelloMeet? HelloMeet, yeah. Is it really? No. I was like, I don't even want to mention their name. No free press. Yeah, no free press for them. But, you know, everyone's copying us. Everyone's advertising against us, which I think is a good thing. But it's like, here's why we're better than ButcherBox, you know, and it's a different world.

1:27:44You know, I think there's been a lot of conversation about this on Twitter recently around, like, Facebook is great for retargeting. Somebody comes to your website, great. Top of the funnel, a little bit harder. Top of the funnel meaning, like, you're exposing your brand to new eyeballs. um that's where i think you know in order to grow from to just continue the growth which we have to do we have to have 12 to 15 000 people a month like at least yeah um we just need a lot more top of the funnel awareness and one of the challenges i've had is uh driving top of the funnel awareness has been really hard it'll make sense for the media acquisition that's why i like I heard that was like brilliant.

1:28:24Yeah, yeah. So we've done other things. Like we've tried to do a lot of like brand top of the funnel stuff that has not worked. I'm hopeful on the media thing. But really we're trying to like get the word out about what we're doing. We're trying to change the industry. But the, yeah, Facebook has been, I mean, you could see it in our numbers. We were like grow, grow, grow, grow, grow. And then there was the iOS change in 2021. And it's just like, and then inflation. Yeah. Made for us. Business is easy. Yeah, super easy. Super easy. Everyone should do it. Yeah. Yeah. I mean, I think that like focusing on the fundamentals is so important for people.

1:29:04Like you broke down the business into like these moments and fundamentals along the way. And, you know, yeah, business is hard. It can be really challenging. But if you just focus on the things that matter and know the things that matter, it can be a lot easier. And I think, oh, a big, this is me just saying from an outside perspective. I think a big part of the success has also been that like you haven't had a mental option for pulling the ripcord, you know? Um, and so when problems come, it's like, well, we're not, I'm not going anywhere. So you just kind of take it one bite at a time, you know?

1:29:37And I think that when you, when it's almost like, uh, in a marriage, if you like, if divorce is an option in your mind, then maybe you don't feel like having the conversation. It's like, you're like, you know what screw this right um but if it's just never an option and you're just like um i'm in right under that hypothetical guise or premise then it's like that's the that's the premise that you approach all the problems within the business it's like well i either die or we keep going so we keep going i'm still alive therefore we will solve these problems one at a time yeah um yeah it is really interesting with the top of funnel component um i feel like i feel like the content is the ultimate top of funnel because you can harness the algorithm finding all those people because it'll serve your meat stuff to the people who really want meat.

1:30:25And you don't have to figure out what the perfect look-alike audience is. They'll do that. And then you have this massive retargeting audience where you can spend the amount of money you're spending now, but it's all warm traffic because you're getting a billion impressions a month on all this content being pumped out, which I think is so cool. I think it's, I think it was just a brilliant acquisition. Thank you. So, yeah, I think I can say on behalf of, uh, all the entrepreneurs who listen to the game, thank you so much for sharing, uh, the story of, uh, ButcherBox, ButcherBox to a Billy, uh, and beyond.

1:30:57Um, but thanks so much, man. Yeah. Thank you. Thank you.