Ten Years In The Making is a weekly podcast on how to effectively grow a startup.
Adam Robinson: All right. So, this is the first episode of Ten Years in the Making, and literally, our best customer, Ryan Pamplin, has agreed to join us. And he’s not just our best customer because he sends us a lot of business. I think he actually is the sort of most savvy guy thinking about all this stuff, so.
Ryan Pamplin: You’re too kind, Adam.
Adam Robinson: For the audience, and by the way, the intended audience is people like us, it is founders of businesses. And just so you know, I thought, and I would love your opinion to see if there’s anything out there in D2C to come like this. Have you heard of this guy, Nathan Latka? He has a podcast. So, like Nathan Latka…
Ryan Pamplin: I do love latkes though, I mean, those are delicious.
Adam Robinson: So, this guy, Nathan Latka, he’s got a SaaS podcast, and now, he has a newsletter. And if you own a SaaS business, it is literally impossible to not read the newsletter and not listen to the podcast because these questions, it’s all about financial metrics and how that reflects into valuations. And basically, you’re building this company, you’re like, I want to get out at some point. Like, where is everybody else? What are they doing? Where are they raising rounds, whatever?
I don’t want that to be the purpose of this, but I feel like people in the audience, meaning, let’s say like the Shopify Plus Store, this is what I’m building for, some sort of eventually, it doesn’t need to be tomorrow, but I am trying to create something that is maximizing the EV of what I’m doing because that’s how I’m spending my time on. So, I send some questions really, I definitely want to touch some of that, but I also just want to touch kind of like some of the how you got here, some of the how do you run your day in your life and stuff like that, and some of the interesting stories about you and your story in addition to just like, well, how do you look at this market for incredible businesses like you have. How are you approaching that? So, yeah.
Ryan Pamplin: A lot of questions, I’ll answer all of them.
Adam Robinson: That was a little kind of intro of like, whatever, so.
Ryan Pamplin: First episode, it’s a four-hour talk. I hope you guys have a memory on your phones for this.
Adam Robinson: Yeah. So, how about we start here? Give me a snapshot of what BlendJet is today and why people– I just want people to know who they’re listening to here.
Ryan Pamplin: Sure. Well, thanks, yeah. Let me start by saying howdy, everybody? I’m Ryan Pamplin, CEO, co-founder of BlendJet. We’re trying to take things from infinity to beyond.
Adam Robinson: Way to that.
Ryan Pamplin: And yeah, we’re very serious, no Mickey Mouse games at all, very serious. But hopefully, you’re oohing and aahing. Also, have you heard about our new mini BlendJet?
Adam Robinson: Amazing.
Ryan Pamplin: Yeah, there you go. If you’re listening to this, you’re like, what is he talking about? But if you saw the video, I’m showing lots of Disney and Pixar BlendJets, so hopefully, for those of you that can see it, this is warm reception, not frozen.
Adam Robinson: Cool.
Ryan Pamplin: All right, I’m going to stop there. But I will say, this is like a huge accomplishment in life, right? So, BlendJet is the number one selling brand of blender on the Internet and invented the portable blender. We have almost 100 patents filed in our technology, over 40 granted. I’m literally sitting here drinking out of this, my coffee latte, which I blend up here, just hit it. It’s portable, no wires. And BlendJet, it’s delicately quiet and can crush ice and frozen fruit and all that stuff.
So, we don’t really sell blenders, we sell convenience. And I like to say that a lot of people because most people already have a blender they don’t use, they don’t want because it’s a big pain in the butt and it’s loud in the kitchen and they make too much and it’s just annoying to clean. So, we made something that’s so simple, literally. Here, I lock this thing, another patented feature, 3, 2, 1, it’s locked. And now, I’m going to drink straight out of the jar and I’m not going to dirty a glass.
Delicious. I threw a little lavender in here. A little secret for you guys if you want to spice up your coffee life a little bit, a little lavender in your latte. But really, this business doesn’t exist to sell blenders, this business exists to solve this problem that convenient food is not healthy and healthy food is not convenient.
And I had a near-death experience. I previously was helping build the first holographic computer. A company called Meta was the precursor to what Meta is today, different company, but eventually some of the assets ended up in the hands of current Meta. So, this was the original Meta that I worked on and I was giving keynotes alongside Bob Iger, CEO of Disney at time, Steve Wozniak, and getting to meet all my heroes in Silicon Valley.
And I went from kind of living the Silicon Valley dream to all of a sudden having a freak accident, cracking my head open, nearly dying, and then up on medical leave for a year. I just upgraded my girlfriend at the time from Beverly Hills to Oakland. And then, about a month into living in the new place together…
Adam Robinson: Scoot that picture over, by the way, because the recording didn’t– move it. There you go. Perfect. There we go.
Ryan Pamplin: So, yeah, so we had this great new life together, got a place together in Oakland. And I was commuting to Meta every day, an hour in the Tesla. And I was having the Tesla park itself in the parking garage and in the most stupid Silicon Valley accident you can imagine. I am running because I’m late and I’m looking backwards, and then I slammed into a concrete pillar, head just decides to open up.
Adam Robinson: I hate to go with that. That is outrageous.
Ryan Pamplin: It is, yeah. I don’t usually tell that part of the story, but that’s what happened. And so, it’s really Elon Musk’s fault. That’s why I have the Tesla miniature on my desk to remind me every day.
Adam Robinson: As a bridge to say, I’m sure you get a cheeky lawsuit out of that one, just like– you don’t want to do that with Elon.
Ryan Pamplin: I don’t think so. Yeah, I’m not one of those people, but…
Adam Robinson: Totally.
Ryan Pamplin: But I think at the end of the day, it kind of threw a wrench in in my life. And before that, I had started another company, first software for measuring video ads on the Internet, BrandAds that got acquired by Extreme Reach or that I was making TV commercials, had an Emmy nomination, kind of word Super Bowl commercial. So, I’m really good at creative. I’m good at sort of analytics and measurement. And then I became good at building cutting edge hardware and figuring out how to build a business around that.
And I got to work with incredible people, and then I almost die. So, everything in my life kind of flashes before me. And then, over this year, I’m recovering and I’m doing smoothies and protein shakes every day to get better. And I’m just going, this is so annoying, like this big, loud thing sucks. Like, I wish there was a…
Adam Robinson: What were you using?
Ryan Pamplin: A big clunky kitchen blender. I don’t recall the specific one. Or if I do, I don’t want to say it, but…
Adam Robinson: The Vitamix people would be so offended.
Ryan Pamplin: Yeah, I don’t want to offend anyone. Look, I have nothing against other blender companies. What I actually am trying to do is not compete with them. The blender tamp total addressable market, our blender is small. And I’m making it bigger. The people on average who are buying my product are people who would not have bought a blender anyway, but they see an ad on TV because we’re 42% share voice on national television for kitchenware, or they see us on Facebook and Instagram. We are top advertiser on there or TikTok or any of these other platforms, of course, email. Thanks to you, Adam. And they see an ad or they see an email or they see something and ends up making them think, gosh, this could be a really good part of my life.
And then, if you love Mickey Mouse with the new Disney collection, you have the CD on your desk. It’s USB-C rechargeable, just like your new iPad. And you plug this in, and in an hour, you get 15 blends from one hour of charging. So, this becomes a daily sort of reminder, a visual cue to have something delicious and nutritious every day.
And as a result, our customers end up using this thing on average one or more times per day versus a traditional blender, which is less than three times per month. So, it really is transformative for the eating habits of now we’re finding people who have these things. And of course, all the retailers have come to us, too. So, we’re in over 30,000 retail stores in the US and we’re just…
Adam Robinson: I don’t know what you can and can’t. You’re selling hundreds of millions of dollars of these a year.
Ryan Pamplin: Yeah, we’re a nine-figure brand.
Adam Robinson: Yeah. Okay, so, and you started in 2018, 2017?
Ryan Pamplin: 2018. 2017 is when we started working on it.
Adam Robinson: So, this is kind of like…
Ryan Pamplin: We’ve launched in 2018, never raised money.
Adam Robinson: Yeah, what I wanted to get out of this entire story was you started the company four years ago. You’re a nine-figure revenue brand. And there’s another topic which I mentioned earlier, like, I love this venture PE versus bootstrapping, whatever. You bootstrapped it. I bootstrapped my business too. I’m really starting to step on the gas now. You really started to step on the gas way before I did. Did you raise money at prior companies? Was it ever even going to be an option to do it with this one, like…
Ryan Pamplin: You know it was. And at one point, we got all the way to a term sheet that we were about to sign.
Adam Robinson: And what stage was that? I’m sorry. Was it a year or was it like…
Ryan Pamplin: Hard to say exactly how you would classify it, but it was a seven-figure number. And it was pretty early.
Adam Robinson: Like a pre-series A or something or whatever.
Ryan Pamplin: Yeah, something like that. And I’m just reading it and I’m reading the warrant. And I’m just like, oh, my God, these are terrible, their ability to buy future shares at that low price.
Adam Robinson: Yeah, it’ll make you want to…
Ryan Pamplin: If they so choose, I was just like, man, this is not a good, favorable entrepreneur friendly deal. Now, I wasn’t creditworthy at the time as a business, so I couldn’t go get a bank loan. But today, I have my CFO, I’m very fortunate, used to be CEO of Uniqlo and was at Nielsen as their CFO and Forever21 and Fashion Nova and a bunch of iconic brands. So, I’m very lucky to have that type of expertise internally that can sort of help us know, like, oh, okay, here’s how you get traditional capital through my bank at a low interest rate.
And at this point, we’re very bankable, right? So, I can borrow eight figures to find inventory because I have very predictable revenue from selling in the inventory for more than it costs me to make. So, it’s a good bet for a bank. But it took a long time to get to that point.
Adam Robinson: I mean, you had money before. Like co-founders, do they can still be capitalized? How did you guys actually get in? Not to get into too much detail, but like I’ve had some weird cap table issues twice with the same set of founders that we resolved very peacefully. It’s just like, how did that– because a lot of time bootstrapping, it just gets really weird if one dude puts in the capital, it’s 50– you know what I mean? Like, how did that all– how do you think about it?
Ryan Pamplin: Yeah, my co-founder John and I, we invested a similar– I don’t even remember the exact number, but something like 700 grand we invested in the beginning total between the two of us and it was just us. And we actually paid ourselves back fully within the first calendar year, so.
Adam Robinson: Boom. That’s when you know you’re on to something.
Ryan Pamplin: We had product market fit instantaneously. Literally, we…
Adam Robinson: Yeah. That’s kind of like to get emails product. It was just like we ran $5,000 worth of ads month one, we had $10,000 MRR from the ads immediately. And like my last company on $5,000 worth of ads, I wouldn’t have gotten $500 worth of MRR. So, sometimes, it’s just like, thank the Lord. This is going to be fun. You know what I mean?
Ryan Pamplin: Yeah, it’s a little bit of luck and it’s a lot of hard work. I think luck is an important factor. And people pitch me all the time their ideas for things. And I’m very brutally honest with friends about how good or bad their ideas are. I would say most people’s ideas are bad. And the reason is because most people think of one thing, and then they move forward. And they’re like, yeah, I had one idea and it was good. And I jumped on it.
And what I like to tell people is write down 100. And then out of those, if there’s one that just stands out, that’s like, oh my God, this solves a problem. That’s really good. And I think a lot of the time, people don’t really know what problem they’re solving, if any. And I think that’s extremely challenging then to find product market fit, if you yourself don’t understand. Like in our case, we knew in the beginning what we were trying to solve was not that people wanted a portable blender or that people needed a portable blender, or if people even wanted any kind of blender, the theory was people eat really poorly.
And then the question was, well, why do they eat poorly? We have, what, 70% of the US now is obese according to the US standards for what obesity is. That’s really bad. It’s not bad because people are big and that’s bad. What’s bad is health, health of humans, like we’re not built to be big. So, when you put the extra stress on the body, life expectancy goes down, quality of life goes down, health care costs go up. These are not good things for enjoying your life and having a long life.
So, if you tell people, hey, I want to sell you something to make you healthy, they don’t want it. It’s a very small niche of people who actually are in market for things to improve their weight. People want to eat what they want to eat. So, what I’m really competing with is really effective marketing and brand affinity and awareness and really low cost from McDonald’s.
So, how do I do better than McDonald’s? Well, I got to make something that’s easier than getting in your car and sitting in line and waiting at the drive-thru and cheaper. So, that’s kind of the barometer for success that we had and we thought, well, we could probably make a portable blender and that would probably be easier than doing all of those things to go get McDonald’s if I could just make something here, and even if you make something that isn’t the most healthy smoothie because you’re putting in scoop of ice cream or whatever, it’s still probably better than two for two at McDonald’s plus the 64-ounce Coca-Cola.
Adam Robinson: Yeah, I mean, 100%. There are a lot of interesting topics there. So, I think going back to you caught lightning in a bottle product market fit instantly, did you know, like I think my vision of who were selling to becomes clear every day and like what we’re selling becomes clear every day. When you were getting initial traction, was that clarity that you just described, was that in your head or did that develop in time? Did you kind of realize the reason that you had product market fit was because you were competing with McDonald’s in this way? Or was that literally the goal from day one?
Ryan Pamplin: The thesis when we created the business was to compete with fast food. And the fact that we actually are doing it is surprising. You know what I mean? That’s not expected. I think when you do a start-up, you almost always end up pivoting somewhat in terms of what your initial idea was versus what you find that great product market fit with. And in this case, it really did kind of click. We had a theory and it turned out to be true. This is not normal. This is not how it normally goes. It is not normally…
Adam Robinson: Totally. I thought we were going to sell to affiliate guys, by the way. I actually thought what we were doing wasn’t CAN-SPAM compliant, and we were going to sell to affiliate guys and they wouldn’t care. But there are no CAN-SPAM lawsuits in the US, so it doesn’t matter. That was basically my original thought.
Ryan Pamplin: Well, that is good that you figured that out.
Adam Robinson: Turns out none of it’s actually true. It is CAN-SPAM compliant.
Ryan Pamplin: When I talk to people and I tell them about Retention and I tell them what it does, I told someone like big-time VCs recently who I was talking to and kind of giving my opinion of the D2C software landscape. And they were like, what’s the top thing for you? And I was like, well, Retention.com, you got to have it. And they said, oh, that’s not legit, you can’t do that. And I said, actually, you can. And I said, there’s a perception that you can’t because maybe at some point, you couldn’t, but you can now. And these guys have got it figured out. They got big brands using it, and it works well. And the open rate indicates to me, because it’s such a high open rate, that it’s a very targeted email that ends up delighting the consumer.
And I think if the open rate was really low. Well, I agree with you. I wouldn’t do it. I wouldn’t do it if it wasn’t actually driving good results. People don’t get upset and say, oh, my God, I was on the site, and then you sent me an amazing free recipe content and I’m really upset about it. That doesn’t really happen because it’s not like we’re emailing cold. We’re emailing people who clearly have an interest. So, I think, there’s a lot of value in it.
But yeah, I mean, I think the origin of how we figured it all out is, there’s a lesson there, which is think a lot about what you’re trying to create and the problem you’re trying to solve and invest more time figuring that out ahead of launch and really validate what you’re doing with surveys. So, if you’re not using a post-purchase survey, like what is formerly called EnquireLabs, now called Fairing, if you are not using that and you are listening to this, you should pause and you should go install that on your Shopify store.
Adam Robinson: Hit pause, ladies and gentlemen. That is amazing. That was one of the things I was going to say. If you could tell people to do one thing, what would it be? So…
Ryan Pamplin: You have to look at survey data. And let me give you specifics on what you should do with it. The first question you should ask is, how did you hear about it? And in the very early days of your survey, do not make it multiple choice, make it type in, and let people type in the responses because you’re going to find out that people are going to say, oh, I heard about you from this web forum that I go and people are talking about it. There’s a whole thread, or I read about it on Reddit or I got an email, like whatever it is, it may surprise you.
And then, after a week or two, go through all that data, use a word cloud, just Google free word cloud, copy and paste in the whole thing, or create a word cloud and show you all the words that are most popular, read you every answer if you can, and then create your multiple choice how did you hear about us through multiple choice on the survey where people can just pick one of those answers and get rid of the typing at that point. But do not have Google as an answer. Google is not how you found me. Google is the phone book. You were already coming to me. You just looked me up and found my address.
Adam Robinson: Yeah, that’s great.
Ryan Pamplin: So, Google’s not an answer. And here’s another thing. Email is not an answer either, because you did not sign up to email or come to my website to get on my email list just randomly. Something drove you to my website. So, what I’m trying to learn from how did you hear about us is what is the true inspiration that caused you to become my customer? It’s not email, it’s not Google. It’s either TV or it’s word of mouth or it’s a Facebook ad or it’s an organic post somewhere. I want to get to the bottom of it.
And then the other thing you can do with Fairing, formerly EnquireLabs, is you can have a follow-up question. So, if someone says TV as the answer, then you can follow up with the question and say, what channel? And you can really hone in on what specific parts of your marketing are working. And it’s just so absolutely essential that you do that.
And then, one more tip on this, most people don’t really know who their customers are. Google, Facebook, all of these guys, when they give you demographics information in Google Analytics or in Facebook Insights, these things are incorrect. They are wrong. This is not true. These demographics are just not calculated as well as reality. And there are all kinds of privacy reasons for that, but you can fix that.
So, what do you do? Add a third, fourth, fifth, sixth question, and say, what’s your gender? How old are you? How much money do you make? Any kind of demographic question you want to learn, you can learn from just asking your customers and you will be shocked.
Adam Robinson: Do you feel like people will be forthcoming with that information?
Ryan Pamplin: Absolutely. And the thing is, statistically, if people are not forthcoming, people give you incorrect information, the likelihood of incorrect data at scale kind of cancels out the other incorrect data. So, people are going to answer incorrectly pretty consistently. And if you randomize order answer, then you get rid of the sort of biases. So, definitely randomize order answer unless it’s like a sequential kind of question and then you don’t want to randomize, like age, I wouldn’t randomize that.
But yes, no, maybe, smoothies, protein shakes, coffee, whatever, randomize things like that to make sure you get accurate answers. TV stations, which station? Make sure you randomize that kind of thing. But surveys solve all your attribution problems.
Adam Robinson: Incredible. We have people who qualify people in the way in which we’re getting more stringent about, but like, I need to get more information about where it’s all coming from, especially because I’m actually starting to do a lot more now. It’s like, where is this effort actually? What’s it yielding? So, question for…
Ryan Pamplin: The old saying is, I know half my marketing is working, I just don’t know which half.
Adam Robinson: Yeah, exactly.
Ryan Pamplin: It’s an old saying and it’s more true today than ever. And I mean, there are so many people that are flying blind, and then there are all these tools. I mean, we’re using Northbeam, and look, it’s a great tool, but Northbeam is clueless about our television. They have no idea.
So, in their universe, they just assume everything is from sources they can track, but then for things they can’t track, it’s not really represented there. So, you can’t just sort of find this one source of truth with a piece of software yet. So, what you have to do is you really have to look at your total spend on a monthly basis and then pick out sort of through the survey what’s my total revenue, what survey? And then sort of multiply the percentage.
So, if your survey says 50% is from Facebook, which is not what I already said, smaller. We’re much more diversified than that. But if it says 50%, then you probably should get more diversified. Well, let’s just assume that, and let’s say your revenue is $1 million, then 50% times 1 million is $500,000.
Now, compare that number to what Facebook claims. Does Facebook say $400,000, and then your survey says $500,000 for Facebook? Great. Or does it say a way different number? For TikTok, it might be half or a third on TikTok of what the survey is showing. What we find is that TikTok way under attributes. So, it looks really like it’s losing, but then it’s really winning when you look at the survey.
Adam Robinson: And I mean, how valuable is that? Yeah, it’s just you need to know.
Ryan Pamplin: It’s game changers. It’s a difference between having a whole ‘nother channel and not having another channel. Like if you are not TikTok today and you’re not scaling up TikTok, you are doing it wrong, like TikTok is the new thing. You’re going to look back in five years and it’s going to be as if you weren’t on Facebook.
Adam Robinson: Do you think it’s the same for my audience is Shopify Plus stores, founders, basically? Do you think I should be doing short-form video on TikTok?
Ryan Pamplin: I think that TikTok…
Adam Robinson: By the way, I am recording a lot of short-form videos right now and I’m having them edited for TikTok, but I’m just putting it on LinkedIn for like whatever, it’s not even a video platform.
Ryan Pamplin: I would try YouTube Shorts, I would try TikTok, I would try it all. I mean, it blows my mind the variety of content on TikTok. Personally, I’m not on TikTok, but I’m also not on Instagram, I’m not on any of these platforms because I stopped 10 years ago using social media.
Adam Robinson: Yeah, totally, but I’m trying to do, it’s like, in my opinion, I’m in a relatively untrustworthy space. I’m trying to build the most trusted brand. I view myself as no direct competitors. I have this huge brand name to build around, and the quickest way to get connection between people and a brand is a person, which I just feel like the game that you’re playing, you’re like way beyond that. Like, you know what I mean?
Ryan Pamplin: Studies show people with beards are more trustworthy. So, I think that’s going for you on TikTok.
Adam Robinson: Right.
Ryan Pamplin: That’s a true statistic, by the way. I do think that there’s value there. I mean, you see people teaching like how to do beading and people how to do power washing and people how to do like everything. There’s something for everyone. And the magic of the TikTok algorithm is it figures out how to show people the right content.
And there is a lot of B2B stuff and there are a million accounts, like I’ll show you how to be big on TikTok. Those things exist. But I think if you were like, let me show you how to scale up your email marketing, and then if you’re like flipping around and you’re like, look, here’s my dashboard in Klaviyo. Look how much they’re making. I think there’s a lot to be learned there. And I think you could build a following there.
But I also will say that LinkedIn has kind of flipped into this social network that no one wanted. And there’s good content on there. I just had a call today with a guy who’s CEO of a CRO agency and I saw a post on LinkedIn that he had made that, was very compelling, and I was like, well, I better talk to this guy.
Adam Robinson: Yeah. I mean, that’s the…
Ryan Pamplin: It works.
Adam Robinson: Yeah, that’s the hope. Okay, so what is your goal for this thing? I mean, it’s in an incredible spot. How are you thinking? Like, for instance, with SaaS, it’s pretty easy. It’s like if I can create the absolute darling and I can get my revenue from 15 to 50 next year, I’m probably going to get at least a 10x, maybe 20 on a secondary. If I want to sell the whole thing, probably 10, whatever, or strategic my way a little bit more. That’s kind of like, do metrics exist like that in e-comm? Or is it like every business is so different in the gross margin, so much lower, that’s such an important component of it? Like, retail versus VC mix.
Ryan Pamplin: I’m not an e-commerce company.
Adam Robinson: This is the answer that I wanted, by the way. Like, how are you thinking about the enterprise value of your thing? And then what are you building for? And what time horizon?
Ryan Pamplin: I am an omnichannel brand. My aim is to build a world-class brand that transforms the eating habits of millions of people around the world, which I’m doing successfully now. With line extensions, things like Disney, it’s incredible validation for us, right? The Disney opportunity came to us. We didn’t go to get, which is extraordinary for me.
Adam Robinson: Unbelievable.
Ryan Pamplin: Yeah. And that was over a year ago. And it’s been like a whole big thing. But it’s cool to do a Disney deal, but what’s really cool is the fact that it’s now going to be more appealing to more people. And as a result, more people are going to have their lives impacted. So, for me, having this near-death experience that then kind of led into BlendJet, I don’t really care about the money. All I care about is financial security.
And if I don’t have to worry financially about anything for the rest of my life, then I’m happy. But at the end of the day, the real goal is to run a sustainable business at the lowest margin I can to achieve the maximum scale I can. And I have a healthy profit that I am maintaining, but it’s slim. And it’s intentionally slim because it’s a choice. It’s a slider. Do you want more profit?
If I wanted to run it at 40% profit margin, I probably could but at a much lower scale. But if I want to run it at 10% profit margin at a much larger scale, my impact on the world is much more significant. When I’m at the end of my life and I’m dying, I don’t think I’m going to be like, how many digits are in my bank account? Like, that’s how I’m going to judge my success. I think I’m going to reflect back on like, wow, what did I do for the world? Is the world better as a result of my existence here?
Adam Robinson: 100%.
Ryan Pamplin: And the answer is yes, then I’m happy.
Adam Robinson: Totally. But other guys like us, when you’re talking about like, okay, I have this thing that’s probably worth hundreds of millions of dollars. I want to get my financial security. In the D2C space, it doesn’t even have to be your brand. You talk to a lot of PE guys, PE brands or whatever. I’m sure you know the value of most companies that you speak to just when they describe a few things about them. My question…
Ryan Pamplin: Yeah, I can figure it out.
Adam Robinson: Yeah. For guys in the Shopify Plus game, how are we thinking about– what is a stop that I could make that would get me that and allow me to keep running this business that I love? And how are investors thinking about partnering with me in terms of a value that makes sense for both sides? And the question is just like…
Ryan Pamplin: So many different ways.
Adam Robinson: Yeah. SaaS to me is pretty straightforward. Sometimes, there are outliers, but there’s really generic sort of like your business is probably worth this, and I genuinely don’t know, I’m asking you, like are there certain different types of these brands that would yield different valuation analysis? Or is there like growth versus capability?
Ryan Pamplin: Yeah. So, I would say that everyone has been extremely focused on market share and growth and even bleeding in order to make money. I have never believed in bleeding to make money because you end up with a Casper, Peloton crisis, which is…
Adam Robinson: Yeah, that’s like a negative unit economic situation. That’s what you’re talking about, where the CAC is basically higher than LTV and your growth is through the roof and you’re just like, I’ll fix this some...
Ryan Pamplin: I do not recommend that because it’s just not the right economy. I didn’t believe in it before. I never had run a business that way. And I just want something sustainable that can get through any kind of weather. And I think we’re about to go into whether that’s really bad.
Adam Robinson: So, by the way, we were on a forum a couple of weeks ago and you were optimistic about consumer demand going into Black Friday, Cyber Monday. Has your view changed?
Ryan Pamplin: I think we’re great.
Adam Robinson: Yeah. Okay. So, it’s not…
Ryan Pamplin: They were great for me, at a $50 price point.
Adam Robinson: Yeah, I was wondering if you have seen something in the last couple of weeks that has made your view of what we’re going into change or not?
Ryan Pamplin: No, I think it’s going to be good. I will tell you this. There were, historically, large amounts of inventory available on national television a few weeks ago to the point that our budget went up by 5x overnight in terms of our spend. And that was shocking. And there’s a real softness in traditional marketing channels for Q4.
Now, why is there a softness? Well, advertisers are spending less money and people are pulling budgets. Why are people pulling budgets? I don’t have the real answer, but I would assume that these big companies are trying to cut expenses, and as a result, they’re pulling back on the marketing.
Now, that’s great for me because it opens up inventory. Wrigley’s chewing gum in the 1920s, I think it was, there was the Great Depression, and everyone stopped advertising. And the cost of advertising went down to nothing. And Wrigley’s dramatically increased their spend and went crazy and became this huge sensation. At one point, they literally mailed a piece of gum to every address in the United States. I mean, they just went crazy and they became this behemoth that they are today, which has survived a millennium or a century. But it will survive a millennium, it’s coming.
But I think this idea that if your economics make sense, if your business is making money, hit the gas. If everybody else is letting off the gas, it’s a great time to hit the gas. For marketers who are driving success in e-commerce, what an amazing opportunity to buy ads at significantly lower rates. And I’m very glad that, like, the one terrible thing that happened during this whole COVID situation was this supply chain crisis.
Well, it killed all the drop shippers, which is great, because those guys were driving up CPMs and killing customer experience, and as a result, burning people so that they’re not going to want to buy things off those platforms, like Facebook or Instagram, and ultimately, killing the effectiveness of the ad inventory. The fact that Facebook has done things to clean that up and with the score, the 1 through 5 score on the site and asking for feedback from your customers directly through Facebook, all that stuff has really weeded out a lot of the bad actors who were kind of bringing down the trustworthiness of the marketplace. So, that’s all good.
And then, of course, the supply chain crisis has also made it difficult for anybody to sort of run that business model. So, I think we’re in a really interesting time where if you create a product and you hold that inventory and you’re shipping that inventory yourself, I think it’s going to be a good Q4. I think CPMs are going to go down for the first time in a while. And I can’t say for sure what’s going to happen on digital, but certainly, that’s true in all other traditional channels – radio, print, television. I’m buying all of it for a lot less than I normally do.
Adam Robinson: So, to wrap up this last conversation, we can’t really put, I think, your response, what it has told me is it’s very difficult to give a revenue or EBITDA multiple to a direct-to-consumer brand business without knowing a lot more in…
Ryan Pamplin: There are so many factors, but today, your multiple is lower than it was a year ago.
Adam Robinson: Totally. I mean, we all know that.
Ryan Pamplin: And a year ago…
Adam Robinson: SaaS is like cut in half, right?
Ryan Pamplin: Yeah. And a year ago, your multiple was probably a factor of top-line times 5, 10, maybe less. The funny thing is, when you’re smaller, your multiple is bigger. When you’re bigger, you’re multiple is lower. So, if you get too big, then you’re only going to sell based on a multiple of EBITDA. But anybody that’s going to buy you is going to want to buy you for the growth potential, not for the modern-day value. They’re looking at what is the road map? What is your BlendJet 3 and 4 and 5? And how are you going to sell that same product to new people? What new products are you going to create to sell to your existing audience and to also bring more people into the fold?
You really need to know these things and you need to have real progress being made towards whatever those goals are. And that’s how you go back to, let’s say, a top-line multiple rather than a multiple of profit because now, the future looks brighter than the present. And as a result, you’re being valued on expectations for the future.
And here’s something that you should really think about. Anybody that is going to buy you and pay a good multiple on whatever metrics you want a multiple on, you’re going to have to give them so much value that it seems like a really good deal for them because it is. And I have…
Adam Robinson: Hold on, like what happened there? You literally have to sell your company for less than you think it’s worth, right? Or someone’s not going to buy it.
Ryan Pamplin: Exactly.
Adam Robinson: It seems ridiculous at the time when you hear these multiples, it’s like they’re buying it at that price because both sides basically think that it’s better than that.
Ryan Pamplin: Yeah, the buyer must believe that they are getting a good deal unless there’s some really unique circumstance. Let’s say if you’ve created something crazy that’s going to, like, kill someone else’s business, then maybe they buy you as a defensive move. But that’s a different story. But if you’re thinking that you’re going to sell, then you should really try to position yourself so that you’re giving so much value that people look at you and go, oh, my gosh, you’re leaving so much on the table. Why don’t you just keep running that business, and a year later, you could make 10 times more money? I’m in that situation.
I have a killer road map. I have something coming out that is so revolutionary that it is like the equivalent of if you didn’t know what a microwave was and I said to you, hey, there’s going to be a magic box in your kitchen and you hit a button, and 30 seconds later, your food is hot. It doesn’t make your food hot, but it is a portable food preparation device.
Adam Robinson: A portable microwave, I mean.
Ryan Pamplin: It’s a really, really revolutionary food prep device that’s coming out at the end of next year. It’s a brand-new category that’s never existed. And I’m very passionate about it. I’m very excited about it. I’m getting tons of IP on it.
And the handful of people that, under NDA, for whatever reason, know what this is, those people are saying to me, you’re crazy to sell this thing right now. Why would you sell this right now? Because they’re like, that idea is even bigger. Like you own the blender market, but this thing is even bigger than that. Like, what are you doing?
And my feeling is, look, like that’s the point of creating value for the buyer. If someday I sell this company to a larger company and they take this business and integrate it into theirs, keep it as a subsidiary, whatever they do, I really deeply care about the legacy and I want to give them so much value out of it that they’re so happy with it, that they continue to grow it forever, and that it affects the maximum number of humans on the planet in the best possible way. And everything I do is in service of this one goal, which is to give people convenient options anytime, anywhere, regardless of circumstance or geography, and to be able to have, let’s say, a larger entity that’s a multi-billion dollar company that is our parent that can dump resources into driving our vision forward and throwing the multiplier on it because of additional distribution channels, international infrastructure, whatever it is that they can add, that just kind of makes the goal happen bigger and faster.
And at the end of the day, if I give them a huge amount of value, they’re going to, I think, be able to execute on it with bigger and better resources than I could. And I would love to stick around. I don’t have any interest in selling the company and going and living on an island. I already lived on that in Puerto Rico.
Adam Robinson: Check.
Ryan Pamplin: But yeah, I mean, I think focus on actually running a business that is a sustainable business, and then focus on future. And if you want to keep running the business, PE is a nice option. You could sell…
Adam Robinson: And by the way, so like another question I was going to ask is like since it’s not an easy exercise, everybody’s super busy. Is there like somebody you trust and would recommend for a plus guy who wants to know what his options are to even reach out to? Or is it just…
Ryan Pamplin: I mean, look, if your revenue is not tens of millions of dollars, you can reach out to anybody.
Adam Robinson: Yeah, I know exactly. We’re talking about sort of like $20 to $100 or $20 to $200 million or something like that, and they just want to sort of know what their options are.
Ryan Pamplin: You should go talk to investment bankers. Go on LinkedIn, search investment banker, and read posts that people make and look up companies that have been acquired that you admire and that you look up to and that you want to follow in the footsteps of and look on the press releases who the buyer and seller had to represent them as investment bankers. And then you call up those investment bankers and say, hey, I got a business that I think is really interesting that I think you’re going to like. And they say, great, give me a pitch. And then you pitch them and you show them a deck and they go, wow, this is really great.
And then sometimes, those people lean in and they bring resources to you and they really help you in incredible ways. And they open up their networks to you and they say, oh, you need a bank loan. I got a bank for you. Don’t worry about it. Here, here’s my friend, he’s the CEO of this bank.
Adam Robinson: So, part of your job, you consider talking to these people, not necessarily to sell the company, but just because eventually, if that’s the plan, you need to have this whole finance engine in your wheelhouse.
Ryan Pamplin: You’re not going to call up a banker and then say, hey, I want to sell my company. And then three weeks later, you’re on the market selling the company. It’s not how it works. You’re going to call them, and a year later, after you call them the first time, maybe you’ll be ready to go on the market. But they’re going to say to you, Adam, look, you got this problem, this problem, and this problem. I can’t take this company in a market. You got to solve these three problems. And once you do that, then you’ll be in good shape.
Or you really need to achieve at least this EBITDA, and if you do that, then you’re going to be good to go, or gosh, you’re just a little small right now because you’re too small for these companies and too big for these companies. So, you just need to get a little bigger in order to fit the mold. So, I think, understanding who your likely acquirers are and starting the conversation with a banker, it’s a good exercise to go through. And you should not talk to one banker, you should talk to a dozen bankers.
And you should ask for referrals from people you know that might have sold companies. Or if you don’t know, literally, just go read the press releases and figure out who did the deals and reach out cold. Bankers reach out cold to people all the time. So, they’re just…
Adam Robinson: Yeah, and by the way, I love an inbound. It’s the greatest kind of business as long as you know that they heard from you first, right? Like…
Ryan Pamplin: Yeah. Figure out your attribution.
Adam Robinson: Right. Rock and roll, man. So, we’ve only got like a few minutes left here. Is there anything that– I mean, I didn’t hit half of this stuff. I would love to talk to you forever about all this stuff because I think there’s so much wisdom always spewing out. I really think it’s interesting, this finance stuff, because I just feel like in the D2C world, I just don’t see anything about it ever, a bunch of, whatever, people, I just feel like if we’re talking about…
Ryan Pamplin: There are these players that specialize in just selling D2C brands. I’ll tell you this, they are not getting premium valuations for their customers.
Adam Robinson: Right. Yeah.
Ryan Pamplin: And I would be very weary of anyone who represents buy and sell side because, oh, yeah, I’ve done a lot of deals with that guy and like on the favor, let me give them this deal, give a good deal on this. You really want someone who has that unbiased perspective who’s going to fight for you. And you’re probably going to pay your banker a fee every month just to be your banker, and then you’re going to pay them a percentage of the deal.
And there’s kind of standard expectations around rates which you can just Google and find, but there’s a lot of choices, but I would really pick your people based on the chemistry and I wouldn’t work with anybody unless they really believe in you and your team and your business because if they don’t believe in it and they can’t sort of explain it as well as you or better, then they’re not going to be able to sell it very well. Ultimately, you’re hiring a salesperson.
Adam Robinson: Totally, 100%.
Ryan Pamplin: Just a very sophisticated salesperson.
Adam Robinson: Rock and roll. Well, let’s wrap it up with, I’m calling this the final five. Do you have a favorite book or piece of content related to building businesses?
Ryan Pamplin: I really love Predictable Revenue by Aaron Ross, which is more B2B focused.
Adam Robinson: So good.
Ryan Pamplin: Yeah. I love Aaron Ross, good guy. Hi, Aaron, if you’re listening.
Adam Robinson: Hey.
Ryan Pamplin: He and I met at a conference that– well, it was like a little meet-up or something he was doing and he was speaking and I told him how I built BrandAds from $0 to $5 million in revenue in the first year. And all my outbound strategy was him. It was his book. I literally knew nothing about sales. And then I read his book and then I made my team read his book. And then we just went from zero to hero very quickly. So, I think, it’s a Bible. And every email that you can hit within your inbox for B2B software that you did not sign up for, it’s just small.
Adam Robinson: True. Okay, founder or CEO that you are following that is not you because I am following you?
Ryan Pamplin: Adam Robinson, he’s really good.
Adam Robinson: Thank you. Flattering. How old are you?
Ryan Pamplin: How old am I?
Adam Robinson: Yeah. Are you– I mean, if you…
Ryan Pamplin: 34.
Adam Robinson: Cool. Single, dating, married, kids, what’s your family situation?
Ryan Pamplin: Married. No kids. But it’s in the cards.
Adam Robinson: Rock and roll.
Ryan Pamplin: Yeah. You saw my wife.
Adam Robinson: Yep, totally.
Ryan Pamplin: She’s at BlendJet as well. So, we work together every day. She’s the star of a lot of our ads, used to be a commercial actress, and is also the head of our customer experience team. But yeah, who else do I follow? I mean, obviously, Elon Musk, right? I mean…
Adam Robinson: You have to.
Ryan Pamplin: I love him. And I’ve loved him since before it was cool. I bought my Tesla stock at $27.
Adam Robinson: There you go, f*cking egg.
Ryan Pamplin: So, I’m a big fan and I’ve been driving his car since 2013. So, I’m a very, very big fan. But a lot of the stuff lately is like, it’s uncomfortable. He’s not keeping it professional in the way that he used to, which sometimes some of the stuff, I’m just like, oh, but he didn’t say that. But I still like it. He’s still an innovator.
Adam Robinson: I think he is the most…
Ryan Pamplin: I think, in history, he’s going to go down…
Adam Robinson: Yeah. The things that he is doing are the most bold things that you could possibly do. And I think he understands the call to greatness that he can sort of just like pull out of these amazing people that he had, like this mission, occupy Mars. Are you kidding me? Making a statement like that, it’s awesome. Anyway, we both love him, man.
Ryan Pamplin: It’s crazy stuff. I do love him. I will say I think he’s going to go down in history as one of the greatest minds of our time. And I think because I’ve been following him for a very long time and I’ve watched his transformation, he’s very different now than he was five or ten years ago.
I spent a little bit of time hanging out with his brother at Ted, Kimbal, who is a really cool guy, and walks around with cowboy hat, real tall guy, a lot of fun. I think he had a really rough childhood. I think that it was a difficult upbringing in South Africa. And I think that he’s a person who has a very thick skin as a result of everything he’s been through.
Adam Robinson: Sure.
Ryan Pamplin: And I suspect that he thinks that– I think he probably views himself as bigger than the US government or bigger than any of these entities. And I think that he really feels like this responsibility that he’s created for himself to kind of make sure humanity survives. And I think he’s very serious about it. And I think the guy lives to do what he does every day. I don’t think there’s any other thing going on in his life that he cares about more than the things that he’s working on.
Adam Robinson: With everything that I’ve read and observed is, I totally agree. So, last question and we wrap up here. Your favorite vacation you’ve ever been on?
Ryan Pamplin: I love Dubai. Dubai is amazing.
Adam Robinson: I’ve never been. I want to go so bad. I want to go so bad.
Ryan Pamplin: You got to save up those Amex points and you got to fly Emirates private suite and take a shower on the plane. I drink the free Dom Perignon and have a really good time. I spent half a billion dollars on their wine collection year that I last flew with them.
Adam Robinson: Well, I got it.
Ryan Pamplin: It’s incredible. It’s a crazy experience. And the malls there are enormous and it’s all indoor because it’s so hot outside and people are very nice. The food is incredible. The hotels are outrageous. The scenery is beautiful. I mean, this is a city that 25 years ago was nothing. It didn’t exist. And now, it’s this metropolis. And the level of service and attention to detail there is unlike anywhere else. And everything is very new because it didn’t exist that long ago. So, it’s a very interesting place.
I don’t know a lot about the Middle East, but I would say that it probably is kind of like the New York City of that region of the world. It’s just a melting pot of everyone. And it’s a very progressive place relative to, I think, the perceptions of the regions around it.
Adam Robinson: Perfect. Awesome. That is the next spot I’m going with my two-month-old. Well, thank you very much, Ryan Pamplin from BlendJet. That was an awesome conversation. There are so many nuggets that I will be able to repurpose for social media on this. I mean, it’s just a wealth of knowledge. Appreciate it as always. Thank you for being such a great customer. And Episode 1, wrapped.
Ryan Pamplin: Thanks for being a good partner. See you, Adam.
Adam Robinson: See you.
Today, I’m talking with Ryan Pamplin, Co-Founder and CEO of BlendJet® — the fastest-growing blender brand in the world.
While Ryan has a long track record of success building startups, this one is completely knocking it out of the park. The fully bootstrapped company was launched in 2018 and, within 4 years, became a 9-figure business serving more than 5 million customers.
In today’s episode, Ryan shares the company’s origin story and how a freak accident shifted his priorities and motivated him to create something that would inspire people to live longer and healthier lives. The BlendJet® was born, turning a household appliance into a category king and giving the fast-food industry a run for its money.
You’ll hear us talk about finding product-market fit, bootstrapping vs. raising money, valuations, preparing for acquisition deals, and more.
Key Takeaways from Ryan Pamplin
- What is BlendJet®, and what problem is it uniquely solving?
- How Ryan eliminated the competition by turning a household appliance into a category king that now serves 5M+ people.
- Why Ryan declined 7-figures of VC money to stay entirely bootstrapped.
- How to think differently about finding a product-market fit in your industry.
- The value of post-purchase surveys and how to use them to uncover exactly why your customers buy from you.
- Taking less profit in return for making a more significant impact in the world.
- Buying ad inventory at a major discount as the economy takes a turn.
- What’s your startup worth? Learn how investors think about valuations.
- Tips to prepare for a future acquisition deal.
Ryan Pamplin on How Investors Determine Startup Valuations
Ryan Pamplin Inspiring Quotes
- “My aim is to build a world-class brand that transforms the eating habits of millions of people around the world.” - Ryan Pamplin
- “When I’m at the end of my life and dying, I won’t think about how much is in my bank account. I think I’ll reflect back on what I did for the world. If the world is better because of my existence, I’m happy.” - Ryan Pamplin
- “We don’t really sell blenders, we sell convenience.” - Ryan Pamplin
- “Convenient food is not healthy, and healthy food is not convenient.” - Ryan Pamplin