696: This 15-Year Old is Running a $100,000 Business From His Bedroom

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1:20Stick around in this one to hear his process for coming up with the idea, how he made his first sales, and the growth in marketing tactics have helped him scale to hundreds of orders a day from cooltowel.co.uk. Harrison Knott, welcome to the Side Hustle Show. Well, Nick, first of all, thank you for having me on. And I'm really excited to share, you know, my top tips for everyone. Yeah, I'm excited for this one as well. I believe you're the youngest guest in the 12-year history of the show. We probably started when you were a toddler. I was three years old. Yeah, I was three years old. Yeah, that's exciting in its own.

1:56So Cool Towel is a, you know, a cooling neck towel inspired by getting hot and sweaty, playing squash as a kid. Yep. So you just wrapped up your third summer of this business. Started when you're 13. It's kind of nuts too. But can you give us a sense of how this summer went for you? Yep. So this summer, I'm projected to have 100 ,000 pounds in revenue, which is about in dollars, about$130 ,000. Yeah. Obviously, that is revenue. Disclaimer, that's not profit. To be transparent, there's lots of hidden costs involved. Everyone sees that big figure and thinks I'm making loads of money. but actually I find more value in the skills I've learned and the knowledge I've learned along the way.

2:33Yeah. You got to be eking out some profit on that kind of sales volume though. Yeah. I'm probably sitting at around 20 profit, which is good, but it's all reinvested. It's all back into business. Yeah. That's fantastic. You know, to have that kind of experience under your belt. Totally. All right. So where does this idea come from? It seems like almost kind of a commodity product where people would go on Amazon and say, okay, I've heard of this thing. Like I'm not very brand loyal when it comes to this thing. I don't know of any brands that are making this. So it's just like whatever comes up and has decent reviews.

3:01So what inspires you to say, you know what, I'm going to take a swing at this. Yeah. So I love playing sport and going to the gym. That's sort of my passion. And three years ago I decided that I'm sick and tired of being hot and sweaty and uncomfortable. And essentially I went onto Google and I searched up, you know, like cooling towel, you know, like ways to cool down and turns out air con's expensive. Fans don't really work that while they just push the hot air around. And the cooling towel wasn't really a thing three years ago. It was around, but it wasn't, there was no big brand selling it.

3:34So I thought, you know, there is a gap in the market for this. I got my grandma to come around and she bought her sewing machine with her and we got a microfiber towel. And with this microfiber towel, we sewed it together around an ice pack. We made the first ever cool towel prototype on day one. And that was sort of the beginning. That was when I thought, okay, well this prototype didn't work, but actually, I know that there is a future for this. So I went on alibaba.com and I found a manufacturer willing to produce and supply the cool towels and bought 50 units and just scaled it from there.

4:06That's the story of how it originated. Okay. So if they were willing to do a relatively small initial order run, because sometimes when you go to Alibaba, it's like, yeah, we want 500 units, a thousand units. And you're like, well, now that's a lot of upfront inventory costs for an idea that I've maybe not quite proven out yet. Maybe other people are selling them, so there's some level of validation, but it's like, well, I don't know if they're going to buy it from me. Yeah, absolutely, yeah. I did have to sort of negotiate my way down with that. And I think because I've used the platform before and I had experience with negotiating with suppliers and also like, I think they knew that I was trustworthy and I wasn't just going to buy 50, you know, I think they knew long-term that I was going to buy more and obviously I have.

4:47Okay, so step one sounds like personal pain point. I'm hot, it's uncomfortable. like what solutions are out there okay here's something that i believe that could solve the problem step two go find manufacturers people who are making something similar ish did you have any modifications for this initial order or was it just like yeah just throw my own brand on here the cool towel brand and we'll see if we can sell those what else went into that initial production run the biggest part for me with the first initial batch was the branding i think that is you know one of the most important things about the product because at the end of the day there are similar products out there but for the cool town to sell it needs to show what it does and how to use it and all the information on it on the bottle and i think that's something i put a lot of time into at the start you know like developing the brand and making sure it was perfect because then it sort of gave me that clear pathway to sort of scaling up because i think if you have bad packaging if you have bad branding and people won't value your product and you'll get you know you'll get returns, you'll get bad reviews.

5:45I think it's just, it makes it more premium. It means I can sell it for more money and make more money. Were you hiring out that design? You're 13 years old. Were you doing it yourself? This cool little like polar bear with a guy? I did do it myself. Nice. Yeah. Well, this isn't the original packaging. This is updated, but the original one I did myself. I think the main thing for me with CoolTow is it wasn't the first business I started. My first business was at eight years old. I was reselling on eBay and other platforms. and essentially at eight years old, I'm not joking either, I've got proof.

6:13Sure, at eight years old, I love it. I got a nine-year-old, I gotta make him listen to this episode. I think I've always just liked the idea of like, it was never money for me really, the reason why I started it was because I liked the idea of being successful and almost like becoming my best self. But I also enjoyed the process, solving the problems. I enjoyed starting a new business. I enjoyed learning about how to grow as a person and as an entrepreneur. I think that's the main thing for me. And I think a lot of people, when they start businesses is they they give up after the first hurdle you know like they get one problem and they just give up the key to my success was was resilient I kept going through all the because I started 13 businesses and I think out of the 13 10 of them were failures really and four of them are successful but the nine that were failed took so you know so much of my time so much of my effort so much of my money you know and it all failed I think most people after losing all that and spending all that time would just give up but from that I've gained so much knowledge and so many skills I can apply into the next business and keep growing.

7:12Yeah, absolutely. So you're 13 years old, you're lobbing emails off to China to find a manufacturer through Alibaba and you get these 50 units landed. Do you remember the production costs for those first 50? It was about three pounds per unit. So it was 50 units. Yeah. Okay. That's helpful to know. Got it. Okay. So you get these landed out of your spare bedroom or the garage or something. Well, now I got to sell them. So what happens next to try and move these units? So again, from previous businesses that I've done, I've learned skills like web development, you know, creating video campaigns and, you know, learning about social media itself.

7:48And I think I applied all them skills. I spent months developing the brand, but essentially I created a website on Shopify and I then developed video ads and I post them organically and also utilized UGC content eventually. Because I didn't have the capital to spend on paid ads, the organic definitely paid off because it was profitable, much more profitable than it is now. The only difference is obviously paid ads is predictable. You know that you're going to make money, whereas organic is hit or miss. You can't guarantee anything with organic, if that makes sense. Gotcha. Was the organic content under your own handle?

8:22Was it under a CoolTowl, like new handle? It was under a CoolTowl handle. I think the original videos are actually deleted now just because they weren't the best, but they did well. They got, you know, a good million views. Oh my gosh. But content that I've got on there now is, you know, they've all got a really good amount of views. I think they're averaging like 500 ,000 with paid, but they're also, all the ones I've got on now are UGC ads. I only really do UGC right now for that TikTok account. And I think that's been really helpful for me to grow because the people that are making content are experts.

8:53You know, they know how to sell products and they have all the equipment and all the skills necessary. Got it, got it. Yeah, well, I'd love to get into the UGC or the user-generated content in a little bit. But it sounds like you throw up the Shopify store and you start to create these own video ads about the product. Do you remember which one or two, like the format or structure that popped off and got to a million views and I imagine helped move those initial units? Yeah, I think it was videos that I did that had trending sounds. It was almost like a dropshipping type of, if you've seen all them dropshipping videos on TikTok where it's like just the product so i had like just the product it was a good hook it was a controversial hook i think some of them it was targeting their pain points obviously for me it was overheating and it was like and and some of them were about menopause some of them were about you know at the gym some of them were about all sorts of stuff you know i had lots of different pathways i was trying to go down to see what performed the best okay and at the end of the day it was trial and error like there was no there was no set in stone video scripts that worked okay Yeah.

9:55Do you have a sense of the volume of these little videos that you made? You know, 5, 10, 20. What's reasonable to say, okay, this is either going to work or this is not working? I think I posted about 50 videos before my first one properly blew up. I mean, I think the first, the 15th video did well. We got like 30 ,000, 50 ,000 views. but then i think the 30 40th type zone was where it did really well okay the reason i ask is it's helpful to know where it's like well i posted five things and i've kind of exhausted my creativity and it didn't make any sales so i was like well i guess this is not gonna work yeah yeah it's like no no i take 30 40 50 swings and keep iterating on the and it's interesting you say oh i need i need to find a controversial hook and i'm like well what's controversial about a little cooling necktowl.

10:47You got to make it applicable and try and find some angle. One thing I did do in 2023 especially is I looked at similar, not calling towels, but similar, so it was dropshipping ads I was looking at and seeing the viral, the outliers, the ones that have done really well, and then taking them and sort of putting that idea and not copying it, but putting my own spin on it. I think that's what I did because obviously you say about my my creative mind and I couldn't develop you know two videos a day doing it all by myself I had to go to other people who have done well already and it's the you know the the proof of concepts already there okay is it all uh Shopify at this point on the cool towel.co.uk site or is it set up a TikTok shop in parallel so at the start it was Shopify but then after about a month I went to TikTok shop so throughout the end of 2023 and the whole of 2024 I was only on TikTok shop oh okay because it was doing incredibly well i think the conversion rate was like like numbers i have never seen on shopify before it was just i think because the platform was new it was pushing my videos out further okay and also it's got a bigger platform for businesses i think um like it's got a built-in affiliate system that really helped me um grow and it also i think the fact that users don't have to go off the app is also really good so they you know they don't have to go to a separate website.

12:13They're always on TikTok. I think that's good. Yeah, maybe there's something in the algorithm where TikTok wants to keep people on the app or maybe they make a cut of every sale. Yeah, absolutely. Yeah, I think TikTok Shop is great. It's definitely got its big benefits, but the only thing I would say is it's also got its not so good aspects. I've had a lot of issues with it. You can go into detail if you want me to about the not so good bit. Like fraudulent orders or what kind of issues? Yes, well, the first 50 orders I ever got, so this is the story. So when When I first got that viral video that did really well organically, I remember waking up, running into my parents' bedroom and like going, oh my goodness, I've just sold 50 orders.

12:50Yeah. You know, I've just got, I've just sold 50, all of it, it was the whole stock, you know, everything that I bought in my first batch. Right. And it was literally like, it was my first time properly that I've, I've done side hustles in the past and I've done like, you know, small businesses, but that was the first time that I thought I can really scale this. I can really take this to the next level. And obviously it took a lot of time to do that, but in the moment it was amazing. Sure. Long story short, I sent out the orders for the first time via like it was called second class shipping. We call it in the UK.

13:17But essentially they didn't have a tracking number. All of them didn't have a tracking number and I thought that would be okay. But TikTok shop did not like that. And even though I had proof from every single buyer that the order has been delivered, they didn't pay me a penny. So all of that time, all that money spent on the product, I had to pay a TikTok shop fee even though I didn't get any money back. So it was a big loss on the first one. Oh my gosh. Okay. They were like, we require you to send it some method that can be tracked. Correct. Yes. I mean, it was in the small print, but it was just a mistake.

13:48Oh yeah. Brutal. Oh my gosh. I'm sorry. Yeah. I mean, I had lots of things like that and, uh, and that was all my capital gone. You know, that was, that was a big moment. Again, a lot of people would have given up then. Yeah. I was going to, I was going to plow that into more inventory. Yeah. Oh my gosh. So what happens after that? I think the main thing that there in that moment was I learned that the proof of concept was there. I know that, you know, there is a demand for this. It can work. Yeah. Well, you got kind of a narrow selling season. And now if you got to go back to your manufacturer and it's going to be another four to six weeks to get the inventory to you, it's like, ah, I need it now.

14:24You know, I got to get it here now. And that is definitely one of the big issues I had was one cashflow because it takes, especially when you start off on TikTok shop, it takes, I think it was two months for, from the order place to you getting the, you know, the money in to your account. Oh, sure. Sure. Okay. So, and then I also had to then take that money and then spend it on product. So basically I had no money for half the summer and that was my big issue. I had no cash basically. And this is across any type of physical product e-commerce where even if you find something that hits, okay, it was a big initial order quantity.

15:00Okay. I got it landed. Now I'm either almost practically giving the units away this is the traditional amazon model to get reviews and build sales momentum to try and climb in the ranks and hopefully make some organic sales or i'm running paid ads to try and you know boost up the conversions and everything else and it's like and then whatever you made if there was any margin left now you gotta plow it back into more inventory sometimes for years like this cycle goes on so i can i can relate to that yeah that is exactly what happened really so for the whole of 2023 and i would say half of 2024 it was just recycling just literally like trying to build up their capital but then waiting again and then i then got into paid ads in mid 2024 and that's when yes i started to scale up a lot more i had months where i was selling 500 600 cool towels you know that was big for that time yeah but then obviously my margins were significantly cut down because i was selling the product for eight pounds and And I was spending£5 on ads alone.

16:00I was choosing quantity over actually making money. It was stupid, really. Now I look back on it, it was stupid. I just wanted to see what I'm ordered. I wanted to see the success. That was just a schoolboy error of me, I think. Yeah, how much volume can we push? Sure, but meanwhile, you got to... Correct, yeah. It was like, how far can I take it? Okay, that's interesting. Have you been able to get the cost of acquisition down this summer? Yeah, this definitely 2025, yes. TikTok have released this new thing called GMV Max. It's essentially, what it does is it runs ad campaigns for you via AI. And essentially, it just means you don't have to know anything about ads to run them.

16:41But what you do need now is a lot more creatives. You need a lot more people and you need to make a lot more content to do well on it and to get your CPO down. Okay, got it. More with Harrison in just a moment, including how he thinks about the per-sale profitability of each cool towel and his large-scale user-generated content campaign coming up right after this. There are less than 100 days left in 2025, which means less than 100 days left to hit those goals that you set or to refocus your energy on what really matters. If you've got some catching up to do and maybe you've been procrastinating on taking that next step, our sponsor Indeed can help you find the best candidates for the role you need to fill and find them fast.

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18:00Just go to Indeed.com slash Side Hustle Show right now and support our show by saying you heard about Indeed on this podcast. Indeed.com slash side hustle show. Terms and conditions apply. Hiring indeed is all you need. One of the tools I personally see make a huge difference for business owners is Quo, formerly OpenPhone. It's the same great business phone system you've heard me talk about before, just with a new name. When you're running a business, you know that every missed call is a missed opportunity. So Quo, formerly OpenPhone, this is the number one business phone system that streamlines your customer communications.

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19:11That's Quo.com slash Side Hustle. Look at them getting that three letter domain. Quo.com slash Side Hustle. And if you've got existing numbers with another service, Quo will port them over at no extra charge. Quo, no missed calls, no missed customers okay is now a good time to talk about how you think about the the unit economics of this where it's like okay well the initial production run was three pounds per towel but now we're ordering way more at a time so that production cost goes down we could sell them for eight dollars we could sell multiples you know and give customers a discount talk to me about how you think about the margins on like a per sale basis when i first started i was buying them in about three pounds and I was selling them for about eight pounds.

19:59Obviously there are lots of hidden costs with that. So TikTok take a 10 % fee in the UK. Now I have to pay 20 % income tax. Then I have to spend a set amount on the ad spend if it's not organic. I then may have to spend 20 % on affiliates because they get a commission for every sale they get. I've got subscriptions to software that I use. I've got lots of stuff. I think that's what people need to know about starting a business is the numbers look amazing. But when you really deep dive into it, I'm making money, but don't get me wrong. I'm making money. I'm grateful to be where I am. But yeah, but it's thin.

20:32There's not a lot of wiggle room there. Correct. Yeah. I think I have improved that over time. So as I developed my brand, I've started, I now charge 10 pounds per unit instead of eight. So I've increased the price a bit. I now get charged 20 % VAT. So that's almost taken off. I've obviously lowered my CPO down. I've lowered my ad costs down. So yeah. And also my product costs. So it goes both ways. Okay. So the advantage of the ad spend is, well, I can drive steady sales at a somewhat predictable cost per acquisition versus just trying to hit the next viral spike on the organic side. Am I kind of understanding that correctly?

21:09Yeah, pretty much. Okay. How did you go about recruiting affiliates or user-generated content creators for this, or those are kind of one in the same? so TikTok shop has a built-in platform for affiliates and for for creators um so in 2024 what I did was I well first of all I was manually going through the list of I don't know what it was like 10 ,000 creators and I was manually pasting in each message sending off each message I was spending hours on this and I was getting like you know people were replying to me and I was sending up free free samples but it was slow it was very slow and there was definitely a lack of creators on the platform at that time.

21:46But now in 2025, I use a subscription-based software to basically automatically send out messages for me to creators that are doing well, which is obviously much better. All right. What tool is that? It's called Reacher. Reacher AI. Oh, okay. Got it. It's a good software. I think it's only good if you have an established brand, really, because I don't think I could have done it from the start. Just because to get them affiliates to accept, you need to have proof of concept with your product. You need to have sales, you know? Yeah, yeah, yeah. Is there an opening pitch where they'll send you a free towel or do you have to lead with, I'll give you 500 pounds or do you have to lead with, you can earn 20 % commissions on all this?

22:25What's the initial conversation look like? So I filtered on the platform. I said, only message people that have over a hundred pounds gross merchandise value. So essentially what that means is I only message people who have sold a hundred pounds worth of product in the last 30 days. I said it very low barrier for me, because my product is so cheap to get out, I actually would rather go quantity over quality. I'd rather just get loads of people making videos. And if one goes bang, it's easy. I'd rather do that than choose specific creators. And also just because I'm doing a commission-based idea and a couple of retainers as well.

22:59I'll go into that in a minute. But essentially, I didn't have to pay people to make videos. I only had to give them free samples and a commission. Okay. Yeah. So all performance-based. Hey, look, if you drive sales, you're going to make money. i'm gonna make money everybody's happy and it all cost you was the cost of the product to get in their hands correct were you focusing only on uk creators too is it or is it like this this is worldwide yeah so this is the thing so uh cool tail for 2023 2024 and basically all of 2025 has been uk only okay mainly because tiktok shop does not allow me allow me to sell internationally that's one big issue i've got with it but uh it's definitely definitely got its downside to that because the UK weather is extremely seasonal.

23:40So I've probably got a four month window of relatively hot weather. Then it goes to rain and cold and winter. So I'm almost out of time really. And that's why I've planned in the future is definitely to expand internationally. But do you want me to read out the cold message I sent out to the creators? Oh yeah, yeah, go ahead. I said, hey, creator name. So I basically extracted the creator's name from it. And I said, I hope you're well. I'm reaching out from Cooltel, a trademarked family owned brand with over 11 ,000 sales on TikTok shop and hundreds of five-star reviews. We've built a movement around cooling towels, helping athletes, parents, menopausal women, pet owners and outdoor workers beat the heat naturally.

24:18No batteries, no chemicals, just science that works. You wet it, wring it out and snap it to feel cooler in seconds. What makes us different? We're not just a dropshipping store. We donate to charity, reinvested creators and care about actually making a difference. We already have proven video formulas shared with affiliates that drive thousands in commissions. And if your content performs, we will boost it with paid ads and offer retainers for long-term deals. You'd earn a 20 % commission and we'd love to send you out a free sample so you can try it out first. Let me know if you're interested by requesting a sample and I'd be happy to answer any questions and get you involved.

24:52Best regards, Harrison, founder, Koutou. That was the message I sent out. Yeah, that sounds great. And that had a pretty good response, right? I think for, you know, cold messaging. Yeah. Yeah. Did you pay any attention to follower account on those creator accounts that you're reaching out to? Or is that pretty irrelevant? When I was manually doing it, I did. But I actually realized that followers, especially on TikTok, don't really matter. Because someone with 2 million followers can get the same amount of views as someone with 50 ,000. And someone with 50 ,000 can get the same amount of people with 100.

25:21It all depends on the quality of the video. Yeah. No, that's good. Do you have a sense of how many free cool towels you sent out to creators to influencers to try and cast this really wide net this body of content you're trying to build up probably sent around 800 maybe a thousand free samples out a lot of them a lot of them haven't got any sales back you know a lot of them were even people who didn't make a video at all you know i'm not saying everyone was successful but i mean i've had some cases where they've done 15 000 pounds in revenue just from one video like some of them have been ridiculously good and and that it's really been successful yeah that seems to be the name of the game it's almost playing like micro venture capitalists where it's like i'm gonna plant a bunch of seeds and i know most of them aren't gonna grow and most of them aren't gonna do anything but the one or two that do they're gonna wipe out all the losses all the costs of doing everything else and uh and make a make a ton of sales yeah okay so we mentioned shopify we mentioned the reacher app to kind of automate some of this outreach process.

26:21Anything else on the tools and tech side that is helping run this business? I use a lot of Canva. Yeah, anything to do with design, you can do on Canva. It's ridiculous. Yeah. I use a lot of ChatGPT. This is a big one. Yeah, I use a lot of AI. Totally. Just to help me. I mainly use it for a customer service. So I have an AI bot to do some of the customer service. And if it doesn't respond in time, if there's a big issue, it then goes to me. But I also use ChatGPT for if I have to do anything that needs a lot of time, I chuck it into ChatGPT and see if it can do it for me. But if it can't, obviously I will do it myself.