AI transcript
Today, we have the creator of RX Bar on the podcast.
This guy started in his mom’s basement with $5,000
and built a protein bar that he sold five years later
for $600 million.
And he tells us the story of RX Bar,
his new protein bar, and why he’s doing it again.
And we got to brainstorm with what are four other ideas
that he thinks somebody could start today?
Trends, opportunities, white spaces in the market,
and how he thinks about them,
how he even created RX Bar using the same process
that he’s gonna outline today.
So that’s this episode with Peter Rahall.
♪ I feel like I can rule the world ♪
♪ I know I could be what I want to ♪
♪ I put my all in it like the days of ♪
♪ On the road, let’s travel ♪
– All right, so here’s how I wanna start this.
You created this, this little bar, the RX Bar that you made,
I think in your mom’s basement,
with you and your elementary school buddy,
you each kicked in $5,000 and five years later,
you sell it for $600 million, which is amazing.
And now you’re back and you’re doing this bar,
the David Bar, which I’ve been eating pretty religiously.
All right, let’s talk a little bit about RX Bar
and then David, I wanna hear kind of this story.
So I think generally the story is out there,
so I don’t wanna make you rehash too much of it.
Can you give us like the cliff notes of the story?
And then I wanna hear about a couple of things.
You said you read one article on Ink and forwarded it
to Jared, so I wanna get a latch onto that,
but give us first just the cliff notes of RX.
– Yeah, so the cliff notes, you know,
in Chicago, 2010, ’11, ’12 at the time,
like there’s an emerging tech scene.
Groupon was there, and it’s sort of like,
if you weren’t doing some sort of information technology,
you’re a loser.
There was no attention or love to like a food brand.
It was– – No status.
– Yeah, it was just like no status, like.
And so we just wanted to, yeah, we wanted a good job,
we wanted an opportunity to be successful.
I had a background in food,
which was really helpful on the supply chain side.
And then Jared’s like my total counterpart,
like very, very level-headed, reliable, organized,
like a more like creative type, I’d say.
And I always like to try to realize innovation,
’cause you know, as an entrepreneur,
it’s like, you’ve all these ideas,
and it was basically like, I just read Ink,
and I was like, hey, Jared, I just sent it to him.
And I was like, $10,000, we can do a nutrition bar.
And it was like some bad article, you know,
like nothing, nothing to it.
– What was the premise of the article?
What did it say?
– It was sort of like an inspirational thing of like,
you can start a biz, like very low cost ways
to start a company basically.
– And it said like the protein bar?
– Yeah, nutrition bar.
– It’s like a wiki-how article.
– Which showed why it’s a low status thing to do, right?
Like, anyone can do it, you know?
And I always was in the nutrition bars,
and so we just started making, you know,
we just started taking actions towards making it.
And right, like, where you start,
where you end up, and I was in a CrossFit,
and so we saw like a distribution channel emerge.
It was very clear, I was like,
I looked at Whole Foods and of the traditional
food retail list and had no idea how to get there.
And it was hyper-competitive.
I was like, how are we gonna compete?
Whereas CrossFit emerged,
these gyms are popping up 2012 to ’13, no competition.
You were not allowed on the shelf if you weren’t pillio.
So that was like the perfect example
of an uncompetitive market, a small market,
that was growing like crazy,
that we could go build distribution in
and we can make the product at home.
So we just went for it.
And once you, you know, you burn the boats
and just jump off the bridge and figure out a fly.
– All right, let’s take a quick break
because I wanna talk to you about some new stuff
that HubSpot has.
Now, they let me freestyle this ad here,
so I’m gonna actually tell you what I think is interesting.
So they have this thing called the Fall Spotlight,
showing all the new features that they released
in the last few months.
And the ones that stood out to me were Breeze Intelligence.
I don’t know if you’ve seen this,
but if you’re in HubSpot and you have,
let’s say a customer there,
you can just basically add intelligence to that customer.
They estimate a revenue for that company,
how many employees it has,
maybe their email address or their location,
if they’ve ever visited your page or not.
And so you can enrich all of your data automatically
with one click using this thing called Breeze Intelligence.
They actually acquired a really cool company
called ClearBit and it’s become Breeze,
which is great because now it’s built in.
I always hated using two different tools
to try to do this.
Now it’s all in one place.
And so all the data you had about your customers
now just got smarter.
So check it out.
You can actually see all the stuff they released.
It’s a really cool website.
Go to hubspot.com/spotlight to see them all
and get the demos yourself.
Back to this episode.
And so you’re literally making bars
in like your mom’s basement type of thing.
– Yeah. We had a five court,
the venture got a 20 court sort of vertical mixer.
And like we didn’t know how to form the products.
We had to figure out how to like form and package.
– And you said there’s this really great article.
You’re like, you know, it sounds cool.
We’re in there just like in the lab
mixing these things together and making it.
And you’re like, it didn’t feel cool.
It felt horrible.
Like we, people were making fun of us.
– Oh yeah.
Like I remember another thing.
You just can’t care what people think.
And it’s also a great test of who actually cares about you
and who’s a good influence.
Like you’re the sum of who you stride yourself with.
Like you want your friends supporting you and saying,
no, you have to work on the weekends.
Like not saying drag, trying to drag you out,
pull you down.
But yeah, looking at, I mean, looking at from the outside
looking at what we were, Jared and I were doing,
there’s no way it was successful.
It was going to be successful.
It was just some local, local little thing.
– Were you doing CrossFit or you just literally saw it
as a distribution channel?
– I was doing CrossFit.
Yeah, I got, I got, I was in the part of the CrossFit
religion.
– So you take a box to your, to your gym and you’re like,
hey, I made these.
– Yeah, I just show up at Tupperware.
And so there was like, well, it’s summer insights.
Like, yeah, what do you think?
And then built a relationship with the owner.
I’m like, I’d love to sell some product here.
And of course they’re good people and, you know,
it starts there.
And then in the theory, so it’s like,
if it’s going to be successful at one CrossFit gym,
why wouldn’t it be successful across others?
And so.
– What, what, what, did it taste good?
So I eat RX bars all the time, by the way, I love them.
But like the first time you open it up,
you, it looks different than a granola bar.
You have to get used to like it being made out of dates
and it being dark.
What do they say at first to the dark bar
and were they, were they any good at first?
– Yeah, it’s, so they’re, they’re really good at first
because they’re made to order.
So we never carried any inventory.
So everything was super fresh.
So that certainly helped.
And the customer back then was all paleo people
who were very familiar with LaRabar.
So there was a familiarity to it that was helpful
for the adoption.
– And I think we had this guy from FitAid come on.
– Yeah.
– And he did the same thing at CrossFit.
He used CrossFit as the initial distribution for same reason.
He’s like, I don’t know how to get into retail,
but I know this community, I’m in this community.
And he, what he realized was he gave them mini fridges.
He’s like, they didn’t have a fridge already.
So he’s like, cool, I’ll give you the fridge,
but then you like stock my stuff in there at the beginning.
And if you want to switch it out later
and put other stuff in there, fine,
you get to keep the fridge,
but sure enough, they just like kept it going.
And he used CrossFit to get to like, I don’t know,
$20, $30 million a year in sales, you know,
CrossFit is the main engine that they think at the time.
– And same for us.
And we, we’d merchandised on top of his refrigerators.
(laughs)
So you go and you’re, so you like,
if this works at one, it’ll work at many, then what?
You’re just knocking on doors every day?
Like what was your schedule, what was your life like?
– We wanted to get data on convenience stores,
grocery stores, other places of distribution
that are to get an understanding.
And so we, we tested at all those other areas
where we’re more like normal markets
where there’s very regular competition
and the brand didn’t work.
So like velocities at a CrossFit gym
would be maybe 80, 80 bars a week.
Whereas the convenience store and the local grocery store
was like one or four a week.
So what, obviously we would just rather be
in every CrossFit gym or in the country
prior to any other distribution.
So we were just laser focused on putting the product
where it’s successful and meeting the customer or the shop.
And the whole plan was like,
let’s just get to scale through this,
this early adopter and this, this market.
And then let’s figure out how to cross the chasm
once we have some scale
and we’re commercially produced around the kitchen.
And so that was a plan to like beat a bar of CrossFit,
get some scale and then figure out across the chasm
once we’re close to that size.
– I kind of triangulated a bunch of articles
and like your revenue was like something like $2 million a year
and then like $7 million and then like $160 million
or something like ridiculous like that.
Is that accurate?
And if, and if that is accurate,
I think that coincides with like the rebrand
making your rebrand or your new labels
the greatest value creation like to ever exist.
– Best use of designers.
– Yeah, yeah, absolutely.
Yeah, basically it was like .com and Amazon’s for three years
and we’d like put our foot into some retailers
and the current branding or the old branding didn’t work.
So it was like didn’t have product market fit
where we, where we, with our core early adopters
wherever we started to go to just like the mass market
or not our core, it was like it doesn’t work.
So basically we timed the rebranding with retail.
And so there was a year before the 160 one that was 36
and that was basically like getting into
call it early adopters of food retail.
So the Wegmans and these like Publix,
these regional ones that are really high quality.
And then once that works, the larger ones adopted.
And so it was like 36 and then most of the market at 161.
– So seven, 36, 161, that’s insane.
– Well, the most insane thing is actually like just
where we were, we use profitable sales to finance the growth.
Like there wasn’t like a big equity check
that came in that finance inventory.
– So how does that work?
Cause that scaling is so crazy, right?
Even the, even if you’re super profitable at seven,
how do you buy inventory for 36?
Did you have a really fast turnover or a line of credit
– Line of credit personally guaranteed by your parents
for 400,000, but we actually didn’t dip into it,
which is funny.
So that’s nice to give you confidence.
– And you started the business with 10 Gs, 10 grand.
– Yeah.
– 5,000 each.
– Yeah, it’s brutal.
And then such as Profitables.com, they give you cash.
You ship product.
So it’s a cycle is much better.
And then it goes back to like sales cures all, right?
We talked a little bit about the rebrand before,
but who, who did that?
You did that, you hired an agency to do that.
Like what was the genius behind that rebrand?
Cause this was, this stood out to me, you know,
from moment one, and it sounds like I’m not alone
that this helped like explode sales in outside of CrossFit.
– Yeah.
So we, we hired an agency called Scott Victor,
very talented brand strategist.
But I think something I want to mention
that’s really, really important that,
because I get a lot of people coming to want to do rebrands
all the time.
And they’re so fixated on the agency
that they think the agency comes in and does it.
But really the responsibility and accountability
goes on the brand owner to articulate the problem to solve
and to communicate it in a brief for the assignment,
for the creative to figure out how to solve the problem.
– What did you write in that brief?
– So, so like the output of our design is very simple.
Like we had a name problem.
Rx meant prescription in the mass market,
but in CrossFit it meant doing something of a high standard.
So in the language, in the culture of CrossFit,
doing something Rx, it was language.
So if you did a workout for first question you get is like,
did you do it Rx?
And so it had a different meaning in this,
this culture than it did the normal American culture.
So, so that was a problem, name problem.
And then it was very clear Rx meant nothing
and it wasn’t a valuable name.
You remembered it, which was nice,
but it was a source of confusion.
Okay, so you pull that through to the design.
It’s the logo and name is very small.
So we minimized it.
Second, we have, when you formulate a product
that’s minimal ingredient and you could,
and like design the way ours is,
you can claim anything gluten-free, soy-free,
dairy-free, high protein.
Well, let’s go on.
None of that mattered when we sampled it to people
and the only thing matters is when I flip over the back,
it’s A to R expert, like what is it?
And be like, it’s like eating three egg whites,
two dates, six almonds, four caches.
So that backup label thing that I referenced earlier,
that was a value communication.
And second, we’re in, the third point,
we’re a protein no man’s land.
The market was at 20.
We’re at 12 grams of protein you’re talking about.
Yeah, so we’re kind of like,
for protein people they’re like, yeah, that’s not enough.
But if you just lead with egg whites,
so three egg whites is the first thing,
that’s like our hierarchies, actually three egg whites.
And so that creates a lot of consumer surplus
because when you go shopping at a cafe for breakfast
and you get egg whites, you get charged a premium.
So egg whites are associated with premium,
they’re associated with quality, and they’re more expensive.
And so that was a great way to communicate
sort of value and surplus.
So all these things are in the brief,
like name doesn’t matter,
here’s the only thing that matters.
We don’t wanna be paleo-positioned
because that is a death trap, it’s a laziness trap.
And so all those factors are laid out in a brief
and then the designer really extracts,
synthesizes and pulls that out.
And they’re not just a designer,
they’re like a brand strategist.
So it’s very important for like any entrepreneur,
like it’s not just, you gotta do the work
and actually define the problems.
And then you bring in an agency.
– You, now you have this thing,
which I feel like you did an amazing job on the brand.
I think we talked about this on the pod.
We’re like, dude, did you see the RX guy, he’s back,
he’s got this new bar, love the name,
love the branding, right off the bat.
– Can I read out some of these words
from the lines from his site, Sean?
– You copywriting on the site, yeah, do it.
– It’s beautiful.
Your new thing is a protein bar.
And the whole shtick is that like quest,
which is like a leading protein bar
is only 20 grams of protein, but 150 calories,
you’re roughly 150 calories in like 26 or 27 grams of protein.
And so the copywriting in the website is beautiful.
It says the genius of a product is it has the protein
of a meal, but the calories of a snack.
We thank our predecessors in the protein industry,
but we’ll take it from here.
Meet David, your protein bar, idealized.
I saw the angel at marble and carved it
until I said I’m free.
All these, these are all like Instagram quotes
or a copy on the website.
Be beautiful.
Protein is essential to maintaining your skin’s firmness
and electricity and hair and scalp and nail health.
It participates in practically every process
of a cell in your body.
So you’re explaining how important the protein is.
But then you have this one line where it’s,
you like have this graph on your website
where you say how many grams of protein per calorie.
And you include Quest and Luna, I think,
and a couple others or Laura Barr, something like that.
But then you even include cod, which I thought is ridiculous.
Because when I saw that graph, I was like, wait,
you’re telling me that David is even more protein dense
per calorie than cod.
And so it’s quite good.
Oh, here’s the part that I love.
You say, you know, we are a company
that is here to make your bodies better.
We’re going to give you protein.
And it just so happens, some of our products might be edible,
but some in the future may not be.
– We focus on making, we build tools to help you
increase muscle and decrease fat.
And so that can come in, I think, that’s our mission.
So whether that’s food, beverage, or apparel,
or that’s what gives us permission to go create and serve.
And that came from like my observation
in the nutrition bar space is like,
that’s the most fundamental thing people want.
So we want to deliver that in the best way possible.
– The thing that would be the most fun for us
is if we got to sit down with the founder of RxBar
and just shoot the shit brainstorm business ideas.
And we asked you beforehand, we said,
hey, this is what we like to do.
Are you the kind of founder your brain never turns off?
You’re always seeing opportunities
that somebody could go do.
But you sent us a little list.
So let’s start with that list.
And I think the fun way to do this is,
I’ll just read the name of the thing you wrote.
You didn’t give us any details.
And you kind of pitched the idea
of what you see as a potential opportunity here.
So idea one, vasodilator.
– Yes, okay.
So I’m a big, I think history is really important
to study in business.
Like I think it doesn’t get enough credit
to like look for the patterns in history.
And in two, so for this one in 2003, four, and five,
I was in high school.
This product called NO2 came to market
and it just blew up the supplement industry
in a good way.
– Pre-workout, right?
– Yeah, I was like saying you got these like big pump.
– Was that like NO Explode?
– That turned into NO Explode.
– Me and Ari were just talking about it.
She said she like strict a pre-workout.
And I remember the days of taking that
and it would like make me NO Explode on my butt.
Like it was like the worst.
It was like cocaine, except it would make you diarrhea.
– Yeah.
So what happened is people started adding
different features to it,
but it has like having healthy blood cells
like really important.
And if you look at the market today,
it’s like super, I call it like chains and gains,
like screaming to not a sophisticated audience.
Like it’s just for pure gains.
And so I would say there’s probably an opportunity
to sort of commercialize something
on just the broader benefits of healthy blood flow.
And it’s like, for example, for men,
like ED is a huge one.
Like I think the positioning of the market,
I think they’re all very, very, very bodybuilding oriented.
And I think there’s one for like pedestrians.
– Did you remember the one, Sean,
the deer one that the, let’s like, it’s like–
– Bucked up.
– Bucked up.
– Yeah.
– Well, yeah, exactly.
It’s sort of like analogous to dick pills in gas stations.
– Versus hens.
– Yeah, versus hens, yeah, exactly.
– There was a guy who came and spoke
at one of Sam’s conferences.
He created, Sam, what’s the guy’s name?
He created the Method Soap.
And then he’s created the Band-Aid brand.
And they created Oli gummies or whatever like vitamins.
– Yeah, air frying. – Air frying.
– That’s the guy.
He’s created three brands
that are all like big in target, different calories.
And he talked about, he goes, what I could do,
I could just walk through a department,
like a store, like a target or a grocery store.
It’s like, what are you looking for
when you’re walking through those aisles?
He goes, I’m looking for a sea of sameness.
– Yeah.
– And anytime I see a category on his shelf
where they’re all positioning,
they’re all chasing the same target
or they’re all positioned the same way.
So for example, he said, Band-Aids.
Band-Aids were all sort of boring, neutral,
try to be the color of your skin, blah, blah, blah.
So they made a Band-Aid brand that was the opposite.
It was like very loud.
It’s a badge of honor for a boo-boo, right?
Or vitamins looked a certain way.
They came in and tried to do it differently.
So do you have a similar sort of philosophy
where you see, let’s say, these vasodilators,
like they’re all broed out.
And you’re like, if I just repositioned the same product,
I would have a new audience.
– Yeah, I think Eric’s strategy is very much design-oriented,
like differentiation through design,
and that’s like looking for.
I don’t have a clear of strategy.
I just really focus on differentiation
and actually like determining how competitive a category is
and how easily you can differentiate
with what I call like valuable novelty.
– Sorry, does that mean that you actually
want it to be the most competitive
so then being very different?
– Yeah, yeah, so it’s like,
you want it to be perceived as very competitive,
but then when you actually apply some rigor,
look at it, it’s actually not that competitive.
Like the protein mark is perfect example of that.
Like barrier entry is pretty low, lots of noise.
On the surface, extremely competitive.
So if you look at it, there’s actually like three
and then a long tail.
And that’s, you know, it’s like,
you want it on competitive market.
And so like, where can you find an uncompetitive market
in a competitive, like in a perceived competitive market,
I’d say, ’cause like a food leverage is like,
it’s too easy to, it’s just the low,
easy to make food, like relatively.
So it’s an unavoidable, like of course, everything’s competitive.
– Hey, let’s take a quick break to talk about
another podcast that you should check out.
It is called The Next Wave.
It’s hosted by Matt Wolf and Nathan Lanz
as part of the HubSpot Podcast Network,
which of course is your audio destination
for business professionals like you.
You can catch The Next Wave with Matt Wolf
and he’s talking about where the puck is going
with AI creators, AI technology
and how you can apply it to your growing business.
So check it out, listen to The Next Wave,
wherever you get your podcasts.
– Yeah, it’s like Peter Teal, Peter Teal talks about
the best investments are ones that seem like bad investments,
what are actually good investments
and the things that seem like good investments
but actually are good investments,
the returns aren’t even there.
So you need that sort of,
you need to be counter consensus,
meaning you need to find something that looks one way,
but is actually another.
So you’re saying, looks super competitive,
but when you sort of break it down,
you realize actually there’s a pretty big opportunity
that it’s not as competitive as it looks on the surface.
– Yeah, I mean, yeah, exactly.
And it’s just simple, like people will come to me,
oh, protein bars are so competitive.
And I was asked, tell me about that,
like how, you know, you just ask a couple of questions.
And it’ll be interesting, they one can’t either.
– What are those questions?
What are the questions? – Tell me, please explain more.
Like what do you, they just can’t explain the competitors.
They’re only referencing the volume of the category,
like the volume of brands,
but they’re not necessarily actually referencing
what they like, who’s good, who’s not.
And then second, a lot of times
they’re not even consumers of the category,
which to me is the opportunity.
It’s like, all right, well,
why aren’t you the consumer in the category?
It’s some dissatisfaction with taste or texture usually,
or price or something else.
And so that’s the opportunity actually.
It’s like, how do you bring new people to the category?
So, yeah, just stuff like that, it’s just funny.
– That’s cool.
So let’s take this visa dilator thing for a second.
In the first 90 days of that,
what would you be doing to figure this out?
Like, what do you actually go do to get these answers?
– Oh, so first I’d figure out,
I’d look at those literature and is it good or like just,
so it’s like two searches.
One, what does the internet say?
Like, what is the reputation of it?
What does culture say about it?
And then two, what does the actual literature say?
So like, what is the,
what are the ideas of the world?
What is human being?
Wayne Norton, what do they believe
through through syndicating the actual literature?
– So does that basically just mean like,
like is the perfect blend of that?
Like a vasodilator is good.
And then you also see like EnoExplode looks way too bro-y
and is lame or–
– Do you want yes, yes on the culture?
Or do you, why, why the two,
what are you looking for is the perfect answer
for those two?
– So on the cultural thing,
is it, second would be like a landscape,
like what does the market look like?
But before that, it was to say,
is this a reputation that I can overcome?
Is there some sort of stigma that is,
it’s good if it’s okay if it’s contrarian,
but is it actually something so bad
that I can’t overcome it?
Or like, what is your reputation just general?
And then second would be like,
or what’s like this market map?
Like, how do I define this market?
And I, what I know, I probably just defined it as
simply like bodybuilding oriented.
There isn’t actually a continuum of like,
you know, natural people, bodybuilders.
Like that’s like a natural opposing continuum.
But, yeah, so just to study the market,
reputation of the market.
And then most importantly,
’cause if the market says this is bad,
then that it’s, and but the literature says
it’s really has all these benefits,
then that’s a contrarian thing of like,
all right, people disagree with you, but then there’s.
So it’s sort of triangulating those things.
– Sam, you invested in Lucy, right?
– Yeah.
So Lucy, the nicotine gum,
our buddy John Coogan’s involved with it.
– And now it’s a pouch.
– Pouch, yeah, they, at the time,
I think the sort of cultural stigma,
there’s a pre-Zen being really popular was,
– Yeah.
– Nicotine equals bad, right?
Aren’t we supposed to be not having the cigarettes bad?
Nicotine bad, blah, blah, blah.
Science actually showed that there were some,
I guess some benefits.
And then what they did was they were like,
cool, can we overcome this?
And it took actually many years,
but the business is now exploding.
But for years, it was kind of,
just trying to get enough momentum culturally
to get over the hump.
– Yeah, and that’s sort of like the Peter Teal’s approach
to consumer is actually how you make money in this business.
And there’s plenty of examples like kombucha,
protein bars are constantly this,
’cause no one thinks there’s too many of them.
Collagen was one, nicotine’s one.
– You know another one that’s happening right now?
Creatine.
– So creatine, the science is one
of the most studied supplements of all time.
It’s like, there’s so many benefits.
But for years, it was like,
this is only for football high school bros.
Like, you know, and now we’ve made it cool.
Or now like women are like,
no, there’s actually a lot of benefit here
or normal average joes.
Like there’s a lot of benefit here.
The whole creatine movement, Sean,
have you seen that right now?
– Yeah, definitely.
– Yeah, I would say like the way you figured out
is just ask your friends like,
hey, what do you think of this?
And it’s like, oh, it’s sort of that’s,
and that’s like cultural reputation.
– Right.
– And that’s people who kind of disagree with you.
So I had that say generally,
like if you were to ask what my pattern is
for sort of consumer investing, it’s really that.
Like, what is something on the fringes
or what is something people disagree with
or is it in culture that actually,
if you look at it from a first principle perspective,
there’s actually something there.
– So let me ask one more question
before we move to the next idea,
which is I’m a smart guy.
I can almost talk myself into anything
or talk myself out of anything.
I have a very good debater in my own head.
And so what you’re giving examples of is maybe things
that are misunderstood or it looks competitive,
but actually it’s not.
I can almost see myself justifying anything
under that umbrella.
Yeah, hey, Peter kind of said this
and I just don’t have the actual judgment
to be able to do it correctly.
– What’s an example of an idea, Sean, of our product?
– Well, I actually want to ask you about the opposite,
which is like, what are categories
that you think you would like run away from?
You’re like, no, no, this is the type of thing
I wouldn’t go into for these reasons.
– Fast, anything fast-following.
Like following liquid death, following Alipop.
You gotta be the first one
in the controversial disagreeable thing, you know?
– Yeah, ’cause you’re trying to win big.
And I think I’ve read something the other day,
like in the AI category that Sequoia was talking about,
they’re like, if you just study all markets,
the market leader, so whoever becomes number one
of a new category will take something like 75%
of all the profits, 50% of all the revenues and whatever.
It’s just like, the spoils really do go to the winner
if you’re trying to win the biggest.
– And I think you could be looking at history.
And this is why I think history is something
I just think is so important in studying consumer.
Like that would be true with,
that would be true with Kombucha College and Market,
these sort of big breakthrough new markets that emerge,
like the first one to do it well takes all the profits.
– Are you, when you say you’re studying history,
what does that mean?
Like you’re reading biographies,
you’re looking at old financial statements,
what are you doing?
– It might be like one would be looking
through your phone at the old category.
So like what did photos of the category look like in 2012?
But for me, it’s my own just experience going through it
and remembering, the different trends,
the different new products that,
and just keeping that recollection of that.
And I think it just isn’t talked about
when I see people starting consumer brands,
they’re kind of like, oh, here’s today, here’s the future.
It’s just such an important piece of like in the equation
of whether this is gonna work or not.
But yeah, I don’t,
there’s no writing books on this stuff and no one cares.
So it’s really, you have to just-
– You have to piece together your own history.
– Yeah, piece together and yeah.
– All right, let’s go to idea number two.
I don’t even know what this means.
Night occasion in general.
Is that an idea? What is that?
– Okay, so again, I feel I feel myself
as like an anthropologist.
So if you look at the morning occasion,
it is very fixed, right?
It’s all around coffee, waking you up, sunlight,
sunlight observation is a new one.
Thanks to, I think it’s a big change culture in that way.
So circadian rhythm, taking supplements,
maybe your morning pills, whatever rituals they are.
The morning occasion is kind of like clear in terms of like,
what products or services are there?
And so sleep hygiene and the sleep occasion
is something that’s become very clear.
That’s super important.
And if you look at that, to me, it’s a wide open,
like there isn’t a coffee of the sleep occasion.
At night, you have what, like magnesium maybe
or something like that, right?
It’s like one maybe cat product.
– Yeah, no one’s owning it, right?
Now you brush your teeth, right?
So there’s like cold gates, got it.
But like, there is a huge opportunity
to sort of be the brand for that occasion.
There’s some obstacles, obviously.
But to me, that’s like, if I’m an entrepreneur,
I’m really studying that.
– That’s a strange insight to have.
What made you get to that conclusion?
– You just gotta think about everything’s occasion based,
right?
The best example is like champagne dominates
a celebration occasion.
Outside of that, it’s a terrible problem, right?
– Or for RX bar, it’s like, I’m driving somewhere.
I’m going to a gas station
and I wanna get something healthy.
– Yeah, like RX bar was obviously on the go,
it was a big occasion.
But to be honest, it was because of the egg whites,
there was some signals, it was breakfast.
It was sort of like a great, fast breakfast.
But I think about like everyone’s talking about sleep.
You have eight sleep, you have all these brands
kind of getting there, but on the consumers,
like the food or beverage or supplement side,
there’s all these like sleep packs, things.
But the real opportunity is like,
how do you be the coffee of fucking sleep?
And that’s where I would spend time.
You know, coffee is the best drug, it’s the biggest drug.
So is there something like that?
Now, there’s some brands working on it,
but I think there’s–
– Which promising ones?
– There’s one called Moon Brew,
there’s one called Beam.
I use both of them.
One is melatonin, one doesn’t.
That’s the big controversial one.
Melatonin is actually sort of,
you could have melatonin is actually
something that could be contrarian.
People say it’s bad for you,
it’s habitat formates, exogenous hormone,
but then there’s also literature
that’s tying antioxidants to.
Those are good, but me and my fiance,
we find ourselves having this beverage
at a small dose before bed,
and it’s like a nice ritual.
– Yeah, I think that’s brilliant actually.
The, basically like looking at moments
and looking for openings.
There’s a Chinese company,
I think it was, maybe it was ByteDance,
the company that owns TikTok,
maybe it was the one that owns WeChat, not sure,
but they, at their annual meeting,
I remember going and watching their annual meeting,
which was weird ’cause it’s all in Mandarin,
I don’t speak Mandarin,
but I’m sitting there trying to translate these slides,
’cause I was like, I wanna learn from,
where other people are not learning from,
to try to see if there’s any alpha there.
And one of the interesting things was they,
their opening slide was all of the moments of the day,
like so a 24-hour cycle, broken into 15-minute intervals.
And what they did was they were like,
“We wanna have a product or an app
“for every moment of your day.”
– Okay.
– This was like totally dominating philosophy.
– That’s insane.
– American companies, you couldn’t come out and say it,
but like obviously, Zuck probably feels the same way.
– Yeah, yeah.
– But they were like, “You’re in line for coffee,
“what’s the inline coffee app?”
Like we need an app that is designed to be awesome
for that moment.
Okay, now you have an hour in bed scrolling at night.
What do we have for that?
That’s like the TikTok app
where you’re just gonna infinitely swipe and be amused.
And so seeing them think that way,
I was like, “Oh, wow.”
And then that creates white spaces.
So you say, “Oh, you might think photos
“is a crowded category.”
Like it seemed like photos was dominated
by Facebook and Instagram and the Snapchat came out
was like, “Oh, we’ll use photos for messaging.”
And instead of photos for memories
and the way they just looked at it with a different lens,
suddenly photos was totally a wide open
multi-billion dollar opportunity
that you had to look at it in some other angle
in order to see it.
– Yeah, and I would just emphasize like
the consumers all in matters.
And so putting yourself in empathizing and going through that
is where it all starts, in my view.
– Yeah, like that.
Do you also look for like product inspiration
from other places?
Like I know some people that do CPG
that they travel a bunch or they’ll be like,
“Oh yeah, in Thailand they drink this.
“What is this?
“If we just take this and now we wrap it in a new label
“that’s like American friendly,
“we might be able to have a product here.”
– So basically you want to consume as much information,
collect as many dots so you can connect the dots
at some point.
And the best example is that is like I had an internship
in Belgium and we supplied Innocent Beverage,
which is a smoothie company.
And in their label, the innovative thing they did
is they would, and their greening statement would be
like one apple, one banana, and half a lemon
or a pinch of lemon.
And obviously I took that dot and connected it to our X bar,
which on the back of our label was two dates,
three eggs, six almonds, four cashews, et cetera.
But that insight was from just purely observing
different markets and different brands and different forms.
– You’re just like journaling or to keep track of these
or it’s all just in your head?
– It’s in the way.
– Yeah, it’s just in the way.
– All right, let’s finish up these ideas
that I want to ask you about the bar businesses.
All right, so idea number three,
continuous testosterone monitor.
This is very fascinating.
– Oh yeah, yeah.
I think the American male cares so much about testosterone.
And I think, I don’t know if this is feasible.
Maybe we do blood tests.
So, and I actually like looked into this for like 10 minutes.
But if you were to have some way to measure testosterone
or some broader hormones in a continuous way.
So like when you wake up in moderate,
like I think there’s a lot of demand for that.
And I think the American male was loved that.
– Sam, you’re the American male.
What are your T levels right now?
– Dude, I want to know my T 24/7.
– Are you 400, where are you at?
Is it higher than your math SAT score was?
– Or?
– That’s the test.
– I don’t even, what’s the SAT out of?
I don’t even know.
– Well, do not get, you don’t get yours checked, Sean.
– I’ve never got, I don’t think,
maybe I got to check once.
I don’t think I’ve ever really,
I definitely am not the typical American male.
– Wait, Peter, do you have, you get yours checked?
– Yeah, I do quarterly.
– Do you have, by the way, I’m,
what’s an investor or AM an investor
and that thing called levels,
which you can continue as glucose monitor.
And like, yeah, everyone has to figure this out.
And if you do figure it out, it’s pretty awesome.
But do you have some like,
because you’re friends with like,
I think Peter Tia is one of your investors,
because you’re, you’re a young rich guy in the health space.
Do you have some crazy Brian Johnson setup
where you have someone measuring your night time erections
and all this crazy stuff?
– No, I’ve, so I’ve gone from like,
getting close to be obsessive about measuring everything
to just now I’m like, totally, it’s like so easier to do it.
My routine is, I’m currently off supplements right now.
I just want to get a baseline of my blood markers.
I test it quarterly.
And then normally I take supplements in the AM and PM.
– I think, I think culture is going that way.
This is my, this is my prediction for 2025,
which is that I think everybody got a really inspired
and sort of over-analyzed everything
through Huberman and Brian Johnson.
I love those guys, but I think the average person,
it’s way too much work for way too little payoff.
And we all kind of know the sort of core four or five things
you should do, and most people don’t even do those.
And so without doing the basic fundamentals,
like none of the rest really matters.
The sort of fine tune optimizing.
And so I think there’s going to be a giant retreat
back to simplicity and basics for like health craze.
– So for the listener, Brian Johnson is like a tech
billionaire who likes the headline is he spends $2 million
a year on his health to live forever, whatever.
He’s got this thing called the rejuvenation Olympics
where you can get your bloodwork done.
And it ranks you like on amongst tens of other thousands
of people to let you know like how good your bloodwork is
and how long you’re going to live, whatever.
There was this woman in the Wall Street Journal.
She was like a substitute teacher.
And she’s like, she’s like says her income.
She’s like, I make like $50,000 a year.
And I just go for walks and I eat healthy.
And she was number one on the list.
And like Brian Johnson was like number six.
And it was pretty funny that all these guys are dedicating
their lives and all the resources.
– Yeah, actually it’s just bingo night
that you need for the community.
– Yeah, and I think it actually causes
like you emotional regulation and not being stressed
or anxious is probably more important
than like obsessing about some other stuff.
So.
– Exactly.
All right, let’s do the most exciting idea
you have on this list.
New religion.
Talk to me, I’m ready.
Preach.
– Sort of like religions, I think it’s a bad word.
It’s like something to belong to
that helps you guide morality and ethics
that can be a ritual or tradition
that we all can like bond over and feel aligned on.
My hypothesis is that there’s no money to make in religion.
So no one joins, no talent, no good leader joins the church.
And therefore it hasn’t been innovating at all.
And therefore, so the economics aren’t there for a priest.
And so therefore there’s no innovation
and there’s a desperate need for innovation.
And then second, like no one wants to be Jesus
and someone has to be Jesus.
That’s why I think why we are where we are at right now.
So if someone wants to be Jesus,
I think there’s a real opportunity.
(laughing)
– Have you guys ever gone to a Shabbat?
– No, something like that.
– Dude, Shabbat is great. – It’s the shit.
It’s the best.
– Shabbat is the shit.
I love it.
It’s like basically a Friday meal
where you don’t use cell phones and you tell everyone
how much you love each other.
– Yeah, and like Saturday I’m not working, like forced.
And I just think that’s the obvious, we bought that.
– Why are you saying there’s no money at all?
These mega churches have a million dollar run rates.
The priests are driving private, flying private jets.
Like, have you seen Joel Osteen?
That’s a billion dollar smile right there.
– So I think maybe it’s like actually the best business
of all businesses.
(laughing)
– I’m pretty sure that the Catholic Church
is the largest landowner in the whole world.
– Not to reference Peter Teal again,
but he talks about for monopolies.
He’s like all the companies that talk about how,
how much of a monopoly they have, how dominant they are,
they’re usually the most vulnerable.
And the ones that are super dominant,
always trying to downplay how dominant they are
’cause they don’t want anyone to take aim at them,
you know, for antitrust.
It’s the same thing I think for money.
It’s like the folks that are bragging about
how much money they make are the drop shippers.
And then the people who are silent pretend
it’s not about the money, have all the money,
and that’s the churches.
– I think it’s probably totally right.
So I misread this, but maybe I should be a priest.
– Well, I’ve thought about this a bunch of ways.
I think you can either unbundle it.
So, you know, one strategy for business is unbundle things.
So take things that come in a bundle.
So you get God and a higher power.
You’re gonna get community and a Sunday ritual.
And then you’re gonna get an operating philosophy for life.
And so that’s the current religion bundle.
And then then you see things like, you know,
look at the NFL every Sunday, look at SoulCycle,
look at these things where it’s like,
oh, they’re giving, they have two of the components,
but not the other three, right?
And then there’s Tony Robbins.
He’ll maybe give you the operating philosophy without God.
And for me, for example, that resonated.
I was like, cool, I want this without the,
but I, you know, I’d like to be in charge of it
and not sort of say it’s somebody else
that’s deciding my fate.
And so I think some people have unbundled this,
but it would be very interesting to see somebody
actually try to provide a new bundle.
And I think, I think you could really just like,
it’s a first principle approach to be like,
across the different domains of life,
like who’s got it right?
Like the Buddhists have got stuff right.
The Jews have got stuff right.
Sure as long as you’ve got stuff right, Christianity too.
And just sort of built like,
sort of look at it from that perspective.
I bet you’d come up with something great.
– You actually have a,
it appears to be a fairly academic point of view
when it comes to operating a business.
And I think that that’s actually pretty cool
because I think it’s considered like cool to not care.
Or like, I’m just going to file my gut,
which I tend to fall in that category.
But to hear your kind of academic point of view,
I actually think it’s pretty neat.
– Thank you.
(laughing)
– I wouldn’t call it that, but I guess for your,
yeah, I mean, I just, it’s like,
I’m a terrible student, but I study a lot.
– What does that mean?
– I was like literally a terrible student,
but I do, like all I do is my free time is study.
– Yeah, it’s actually nice for me
because I kind of, I do the same.
And then sometimes I meet people
who are 10 times more successful than me.
And they’re like, yeah,
I don’t even think about all that stuff.
I’m like, oh wait, am I wasting my time?
But you’re like, oh yeah, we looked at this.
It seemed like really good distribution.
Or I really thought that, you know,
for the, for the design agency,
the inputs matter as much as the inputs
will dictate the outputs.
And so I was super clear on this.
Whereas like, I think a lot of successful entrepreneurs
just sort of hand wave.
And I get the sense that it’s not really as hand wavy
as they think.
And it, either they’re downplaying it
or they’re kind of like Michael Jordan.
You’re like, how do you shoot a jump shot?
He’s like, I don’t know, I just do it.
I don’t really think too much.
But I like that you’re able to articulate
some of these things because,
at least for someone like me, that resonates
’cause that’s how I think.
So, you know, it’s-
– I would, I would perhaps say like,
they’re not as introspective.
They’re probably not analyzing why they came up
with what they came up and they’re probably not,
they’re just like, I think a lot of entrepreneurs
are all about like charging forward and moving forward.
I’m always sort of like looking back
and studying the past of like, why did this work?
Was it a framework?
Can I come up with a framework?
Was it a pattern?
– Well, let’s do a little introspection on why do David?
Because you’ve, on one hand, one way of looking at this
is you’ve already beat this level of the video game.
You created a protein bar, you won $600 million.
You get the nice house in Miami and it’s all done, right?
And of course you could go back and do it again,
but maybe like, you should do a new thing.
That would be one argument.
We, me and Sam have talked about this before.
There’s two, you know, type one, type two entrepreneurs,
type ones are always looking for the variety.
The next new thing, even though they’re most equipped
to actually go do the thing that they know really well,
they don’t want to do it.
And then there’s other people we call speed runners,
this type two, which is, now that they feel like
they have a new point of view, a new mastery of the game,
they’re really excited to go do it.
This is just in their blood, it’s in their DNA.
They just want to go back to the same space.
I don’t know if it’s as simple as that,
but why did you decide to do it again?
– Yeah, so it was in process.
So I had an odd repeat, so that was a constraint.
But then I wanted to actually prove to myself
that I wasn’t just a CPG entrepreneur,
that I could go do this in other sort of industries.
So I actually, I went to go explore different industries
and try to like, and I kind of like started and stopped
and a lot of times.
– What sorts of stuff?
Give us a sense.
– Like synthetic biology, I think is like fascinating.
That’s a perfect example.
I was like, this is sounds like science fiction,
biotech is incredible.
Like if we can actually control biology,
like this would be an amazing thing.
So I started studying it, and you know,
this is where I think like Elon’s like a,
not a good influence.
Like I was like, oh, he like, I can like learn anything.
And then very quickly it was like,
I can’t fucking learn this stuff.
Like biology, these people like spend their whole careers
learning this, and I was like, I’m not that smart.
I can’t learn new things.
And I’m never going to start a business
where I have to pick up the phone to fix the problem.
Like if I can’t don’t have the competency
to fix the problem or understand it,
it’s like a position I’ll never want to be in.
That was a bit of like self-awareness,
call it a humbling moment.
And then I spent some time that I came back
and then when my non-compete came up,
I was like, oh my God, I see it.
Like I couldn’t help but see like a vision of something to do.
And so I was like, you know what?
I’m okay, I’m okay with just being called a type two.
And I’m okay.
Once I die, it just says like, nose protein bar.
You know, like, watch what I’m going for.
My gravestone, that’s okay.
Like, and it goes back to like self-awareness.
Like you got to do what you’re good at.
And like, one thing I’ve learned is like,
as I got older, I’m 38 now.
Like I do find it harder to learn new things.
Like I’m a later adopter.
Why do it again is like,
I see a huge opportunity to bring,
to grow the market, to delight customers.
And it’s far.
– Are you calling the shots?
Are you the CEO and are you like a very hands-on CEO?
Or are you doing it?
– Are you chairman?
– No, I’m the CEO and I’m in the office every day.
I’m at manufacturing right now.
I only have one way.
– So here’s the deal.
I made most of my money from a newsletter business.
It was called The Hustle.
And it was a daily newsletter at scale
to millions of subscribers.
And it was the greatest business on earth.
The problem with it was that I had close to 40 employees
and only three of them were actually doing any writing.
The other employees were growing the newsletter,
building out the tech for the platform and selling ads.
And honestly, it was a huge pain in the butt.
Today’s episode is brought to you by Beehive.
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That’s B-E-E-H-I-I-V.com.
– When you have a four month old kid,
it sounds like you’re gonna get married soon.
You know, a lot of people in your position
who imagine you have roughly in the ballpark
of nine figures, liquid,
that’s enough money for many generations.
You have a new kid where you could be at home with them.
Why do you even give a shit about starting this new thing?
– I think the idle mind’s a devil’s playground.
– But you’ve had an idle mind, no,
for the past few years?
– Yeah, but I still made myself busy.
But it was idle relative to it now, yes.
I just think it’s dangerous.
I need to produce, I need to make stuff.
I need stress, I need to be challenged.
I need risk.
I’m a way better man with responsibility.
And then second, I want to make sure my son sees daddy.
Working, working hard.
I need to be a role model for him.
I need to be in an office.
I need to be sacrificing.
And then at a fundamental level,
as a human, I’m not happy if I don’t,
I’m at risk on, I don’t have responsibilities.
– Does that mean you were kind of bummed out
or for the past few years?
– Yeah, I just was unfulfilled.
I was just like, being an investor sucks.
– Yeah, it’s pretty boring, isn’t it?
– Well, the only good thing about it
is you can like, you have more freedom of time
and responsibility.
Like that’s the great thing about it.
And I just don’t actually like that.
– Have you ever seen this Reddit post
by this guy Jake who started Movement Watches?
– No.
– They were one of the early DTC brands.
They made a watch brand that got really big
off of Instagram.
And he wrote this thing on Reddit,
which I think you would never expect this guy to be here.
They sold it for I think a hundred million dollars.
You would never expect him to just be lurking
random like beginner threads about entrepreneurship.
And he wrote a thread that he says,
“I sold my company for millions
and I’m lost more than ever, 31 years old.”
He says it pretty openly.
“I sold my company movement for a lot of money.
I thought all my problems would be solved.
It made my life really cushy and comfortable.
I optimized for being as stress-free as possible.
I play video games when I want.
I wake up when I want.
I have really no reason to go to bed if I don’t want to.
I always thought this was the dream
and I’d be happy forever until I wasn’t.
I realized I’m in this incredibly unique situation.
I wanted to share some things.
And then I have to, I’ll just fast forward.
There’s a bunch of stuff he talks about.
I’ve been separated from the company for two years.
I’m 31 single.
I never have to work again.
I’m also lonelier than ever and deeply depressed.
I really believe that we need purpose in our lives
to be happy.
For some, that’s raising a family.
Others, it’s their career, blah, blah, blah.
And then he goes to the bottom and he just says,
“We can plan and analyze forever, but here’s the lessons.
But there are lessons that are unknown
until you start moving forward.
You cannot live without struggle and pain.
We either choose our struggle and pain
or it will find us through depression and loneliness.”
I thought that was really powerful what he wrote.
And you, at my point, my, you said you have to work.
You said you don’t have to work.
Like you have to.
– Just not for money.
It wasn’t for money that you had to work.
It was for yourself.
– Yeah, yeah, just like, you need to produce.
– I want to bring up this article
that got written about you.
It was on medium.
You know what I’m talking about?
– Yeah, it was like a super sensationalized,
terribly upgrade and she was just projecting.
– I thought that was going to be the case.
I told Sean I was going to bring it up.
And he goes, he’s, this is what he’s probably going to say.
It, Sean nailed the prediction.
But for anyone who’s talking about,
who’s thinking about, or the article that I’m describing,
it’s basically the head, it’s beautiful photos,
but it’s kind of like they kind of paint this article
as the lost young rich guy who doesn’t know
what the hell he’s doing in life and is unhappy.
And like the photos are like you like looking off
to the distance, but there was one pretty amazing stuff.
– Dude, just pro tip for founders.
Anytime somebody wants your article at you
and they want you to take photos looking longingly
at the window, they’re about to fuck you.
That’s what they’re trying to do.
They just don’t take the photo and don’t do the article.
– The paragraph goes, so Peter Bonafoli furnished house
for $19 million in May.
He spent his time between here and Chicago.
He chose Miami because there’s no income taxes.
He has a Ferrari and a Vespa parked in the driveway.
A housekeeper who comes daily,
keeps the seven bedroom spotless.
The most are usually empty.
Like just little jabs right there.
And then she basically says,
this looks like a place that tick the box
requesting the newly rich bachelor package.
And this setup fell straight from the sky.
Just like constant jabs.
– Why?
– Dude, and first of all, I did it crazy
that you probably spent the whole day with this woman
and you probably became friendly with her
and that she just kind of like.
– Yeah.
– And in which she couldn’t like,
I’m very introverted and I love being alone.
And I never once said I was unhappy.
It’s more than like she was projecting what she would be.
Like she’s like, couldn’t imagine living here alone.
And I’m like, this is fucking great.
Like it was just like, it just shows you can’t trust media.
Like the story it was supposed to be about,
my process for finding my next business.
– But it was still a good article.
Like there was some cool insights of it.
It’s like a little bit about your background story
and the photos are dope.
– One of the things Sam and I like to talk about
when we both sold our companies,
we were like the days, you know,
there’s like this whole process of like the journey
of this thing and then you’re not gonna sell.
That’s kind of a stressful time.
And it’s just kind of like relief when you sell,
at least that was how it was for me and him.
It’s like more than what you think should be
just exuberance was actually just relief
that the process actually like finished
and it was successful.
And like your employees are all at a good spot
and like everything worked out.
But then there’s like, you know, that post exit, right?
Figuring out what you want to do, see, you know,
go to the ATM, you print out the balance the first time.
You’re like, holy shit, this is cool.
Do you have any of those moments that you remember
that were just memorable for you?
Just like unique human life experiences
that you had going through it.
That’s the first question.
The second would be like, you know,
if your cousin or your brother was going through this
or was about to do it, what would you kind of tell them?
What would you advise them now that you’ve been through it?
– Yeah, I would say that by going through the process
that took me a while to like actually comprehend the money.
– Had you taken money out of the business before that?
– No, no, so I went from basically like, you know,
75K a year to it’s like really crazy money.
So that process took me a while.
And in general, like that’s just like financial literacy.
It’s just not, I don’t have a good instincts on it
for some reason.
So it took me about a year to like realize what it was.
And then going through it, like,
I just, maybe it’s like I have kind of like low self esteem
for being dyslexic, I think.
So I didn’t think I was great.
You know what I mean?
I just don’t think I’m that special.
And then I didn’t realize like,
you just can treat it differently.
– You also were living in maybe not the most friendly
or not the most, Miami is not the best place to be, I think.
Well, you could say it’s the best place to be
for the newly rich.
Or you could also say it’s probably,
it could be a pretty bad place to live
if you’re newly rich and a young man who’s single.
Like it could be, you could go,
you become a D gen pretty easily.
– Yeah, if you don’t have discipline,
it’s a really dangerous place.
But it’s actually a great place
’cause there’s a lot of high network people there
that you actually can learn from.
The issue with Miami is that there is no residue
of the actual building, it’s just the outcome.
So you don’t see the office,
you don’t see, you don’t hear the stories,
you just see the outcome.
And so it was a bunch of like,
it’s, yeah, it’s a byproduct of all that.
You don’t see any remnants of the process.
And so that’s what’s dangerous about Miami
on wealth management.
And I would just define the different sort of options.
Like you can go with Goldman, they’re gonna feed you,
they’re gonna make you feel good.
Just go through sort of like how to manage this money.
‘Cause that’s what you need to get.
You immediately need to figure out what to do
and how to do it.
And there’s sort of like different categories
and approaches based on your risk appetite
or what you want to do.
So that’s what I wanted to help with.
And I would help someone is like,
here’s how you should think about it.
And here’s how like help them not waste their time.
– All right, I want to ask you two questions.
First one is real simple.
How big can this be, David?
As I’m 75% of way through this ball right now.
– I would say how big, so the market,
I think it’s like a say $8 billion TAM,
the protein subcategory.
To me, the big exciting opportunity
is to convert non-protein bar people
and bring them into the category.
So like just interviewing people,
they’ll often say, I’m not a protein bar consumer.
So I want, if we can achieve the mission of bringing,
converting as many non-protein bar people
into protein bar people, that would be a huge.
– I see a clear path to a billion in sales, top line.
– Is that your threshold for success?
– That’s a good question.
Enterprise value, yeah, I would say, yeah,
I would want a billion in top line.
– What’s that worth?
– Depending on growth and EBITDA,
you put a three or a five on it.
– I love how you don’t shy away.
We have a lot of people that come on this podcast
that they want to win and they want to win big
and they want money and they want, they want things, right?
We all want things.
And whenever Sam will ask a question like that of like,
does that, would that be, would anything less than that
be like not a success for you or something like that?
They’ll like always go back to like,
what they think they’re supposed to say.
No, no, no, this doesn’t define me.
You know, as long as I wake up every day
and my wife kisses me on the cheek, I’m good.
And I love that you don’t give a fuck.
– And I see that in a bunch of your quotes.
We have this quote section.
I just want you to react to some of these.
My favorite, by the way.
Don’t trust a guy who celebrates his birthday.
– Yeah, I know, he’s completely through,
but I’m not against it, but it’s kind of true.
(laughing)
– You talked about how most people
don’t really experience any adversity.
And you said a quote, most people are soft as baby shit.
Expand on that.
– Yeah, I just think it’s character shit.
I think it’s like, and you were a really high character,
usually some trauma at it, a trauma’s relative.
And if you haven’t gone through trauma, that’s fine.
But just if you’re just self-aware of it,
like that’s the first step.
– You do things now, even though your life
could be very comfortable, we got a bunch of money.
You could make your life as comfortable as you want it.
Do you do things now that kind of voluntarily
make your life less comfortable than you otherwise could?
– Without sounding like a rich asshole, like.
– No, I mean, I’m truly.
– I like the rich asshole version of you.
You’ll be just all like that.
(laughing)
– He’s like, I have one butler, not three now.
– Yeah, I don’t.
– It’s tough out there.
– It’s like, don’t do it in the right words.
Like, that’s such a, you know, it sounds so terrible.
No, I mean, so I think like physical exertion
and doing physically things hard is the easiest way
to do adversity.
And that’s why you see a lot of people doing that.
And so that’s easy.
But my company’s a priority,
and the first thing to go is my health.
Like, it’s my company, my family.
My family’s probably more important now.
But like, I’m not as, I’m not.
My family’s more important than my company and then me.
And so my health is the first thing to fucking go.
– Is your new company in person or remote?
– What do you think?
– Yeah, I made the biggest mistake.
– He’s like, have you been listening?
– Yeah.
I was hoping there was like,
I was hoping there was like a 3% chance.
My company, we started it like kind of like right after COVID.
I’ve made such a mistake, dude.
We did remote and it’s like an irreversible thing.
– Yeah. If you want a high performing company,
if you want to win, you obviously have to do it.
And the thing is like, my work’s fun.
So being the office-
– Yeah. Well, that’s why I’m doing it.
I don’t care about the winning, it just is fun.
It’s fun to be around your, like to become your friends.
– Oh, and that’s the thing is like my social bucket
is fulfilled through my work colleagues.
Like, so I don’t really socialize outside of my work.
– Yeah. I mean, it’s, I was in the same boat.
You just, you give someone a job.
You’re hired, want to be friends?
– Yeah, my paid friends are the best friends I’ve found.
My W2 friends are awesome.
– Yeah.
(laughing)
– Well, dude, Peter, I know we’re a little over time.
So we’ll, we’ll, we’ll let you go.
But you’re awesome.
I really appreciate you coming on.
I think your story is dope.
I think you’re very truthful and self-aware.
And that’s a pretty deadly combo.
It’s something, you know, I think two virtues to strive for.
And I think you have a hardcore approach to this
at a time where it is unpopular to be hardcore.
You almost have to apologize for like caring and trying
and working and prioritizing stuff.
I think there’s a bunch of people who will listen to this
that want that also and will feel more empowered to do it
in the same way that you were saying like,
Elon lets you think, wait, shit, can I do anything?
Right? Like it gives you permission to like, you know,
to be a certain, to be the way you want to be.
And I think you’ve done that today on the spot.
So I appreciate you coming on.
– Thank you guys.
♪ I feel like I can rule the world ♪
♪ I know I could be what I want to ♪
♪ Put my all in it like no days on ♪
♪ On the road let’s travel never looking back ♪
[BLANK_AUDIO]
This guy started in his mom’s basement with $5,000
and built a protein bar that he sold five years later
for $600 million.
And he tells us the story of RX Bar,
his new protein bar, and why he’s doing it again.
And we got to brainstorm with what are four other ideas
that he thinks somebody could start today?
Trends, opportunities, white spaces in the market,
and how he thinks about them,
how he even created RX Bar using the same process
that he’s gonna outline today.
So that’s this episode with Peter Rahall.
♪ I feel like I can rule the world ♪
♪ I know I could be what I want to ♪
♪ I put my all in it like the days of ♪
♪ On the road, let’s travel ♪
– All right, so here’s how I wanna start this.
You created this, this little bar, the RX Bar that you made,
I think in your mom’s basement,
with you and your elementary school buddy,
you each kicked in $5,000 and five years later,
you sell it for $600 million, which is amazing.
And now you’re back and you’re doing this bar,
the David Bar, which I’ve been eating pretty religiously.
All right, let’s talk a little bit about RX Bar
and then David, I wanna hear kind of this story.
So I think generally the story is out there,
so I don’t wanna make you rehash too much of it.
Can you give us like the cliff notes of the story?
And then I wanna hear about a couple of things.
You said you read one article on Ink and forwarded it
to Jared, so I wanna get a latch onto that,
but give us first just the cliff notes of RX.
– Yeah, so the cliff notes, you know,
in Chicago, 2010, ’11, ’12 at the time,
like there’s an emerging tech scene.
Groupon was there, and it’s sort of like,
if you weren’t doing some sort of information technology,
you’re a loser.
There was no attention or love to like a food brand.
It was– – No status.
– Yeah, it was just like no status, like.
And so we just wanted to, yeah, we wanted a good job,
we wanted an opportunity to be successful.
I had a background in food,
which was really helpful on the supply chain side.
And then Jared’s like my total counterpart,
like very, very level-headed, reliable, organized,
like a more like creative type, I’d say.
And I always like to try to realize innovation,
’cause you know, as an entrepreneur,
it’s like, you’ve all these ideas,
and it was basically like, I just read Ink,
and I was like, hey, Jared, I just sent it to him.
And I was like, $10,000, we can do a nutrition bar.
And it was like some bad article, you know,
like nothing, nothing to it.
– What was the premise of the article?
What did it say?
– It was sort of like an inspirational thing of like,
you can start a biz, like very low cost ways
to start a company basically.
– And it said like the protein bar?
– Yeah, nutrition bar.
– It’s like a wiki-how article.
– Which showed why it’s a low status thing to do, right?
Like, anyone can do it, you know?
And I always was in the nutrition bars,
and so we just started making, you know,
we just started taking actions towards making it.
And right, like, where you start,
where you end up, and I was in a CrossFit,
and so we saw like a distribution channel emerge.
It was very clear, I was like,
I looked at Whole Foods and of the traditional
food retail list and had no idea how to get there.
And it was hyper-competitive.
I was like, how are we gonna compete?
Whereas CrossFit emerged,
these gyms are popping up 2012 to ’13, no competition.
You were not allowed on the shelf if you weren’t pillio.
So that was like the perfect example
of an uncompetitive market, a small market,
that was growing like crazy,
that we could go build distribution in
and we can make the product at home.
So we just went for it.
And once you, you know, you burn the boats
and just jump off the bridge and figure out a fly.
– All right, let’s take a quick break
because I wanna talk to you about some new stuff
that HubSpot has.
Now, they let me freestyle this ad here,
so I’m gonna actually tell you what I think is interesting.
So they have this thing called the Fall Spotlight,
showing all the new features that they released
in the last few months.
And the ones that stood out to me were Breeze Intelligence.
I don’t know if you’ve seen this,
but if you’re in HubSpot and you have,
let’s say a customer there,
you can just basically add intelligence to that customer.
They estimate a revenue for that company,
how many employees it has,
maybe their email address or their location,
if they’ve ever visited your page or not.
And so you can enrich all of your data automatically
with one click using this thing called Breeze Intelligence.
They actually acquired a really cool company
called ClearBit and it’s become Breeze,
which is great because now it’s built in.
I always hated using two different tools
to try to do this.
Now it’s all in one place.
And so all the data you had about your customers
now just got smarter.
So check it out.
You can actually see all the stuff they released.
It’s a really cool website.
Go to hubspot.com/spotlight to see them all
and get the demos yourself.
Back to this episode.
And so you’re literally making bars
in like your mom’s basement type of thing.
– Yeah. We had a five court,
the venture got a 20 court sort of vertical mixer.
And like we didn’t know how to form the products.
We had to figure out how to like form and package.
– And you said there’s this really great article.
You’re like, you know, it sounds cool.
We’re in there just like in the lab
mixing these things together and making it.
And you’re like, it didn’t feel cool.
It felt horrible.
Like we, people were making fun of us.
– Oh yeah.
Like I remember another thing.
You just can’t care what people think.
And it’s also a great test of who actually cares about you
and who’s a good influence.
Like you’re the sum of who you stride yourself with.
Like you want your friends supporting you and saying,
no, you have to work on the weekends.
Like not saying drag, trying to drag you out,
pull you down.
But yeah, looking at, I mean, looking at from the outside
looking at what we were, Jared and I were doing,
there’s no way it was successful.
It was going to be successful.
It was just some local, local little thing.
– Were you doing CrossFit or you just literally saw it
as a distribution channel?
– I was doing CrossFit.
Yeah, I got, I got, I was in the part of the CrossFit
religion.
– So you take a box to your, to your gym and you’re like,
hey, I made these.
– Yeah, I just show up at Tupperware.
And so there was like, well, it’s summer insights.
Like, yeah, what do you think?
And then built a relationship with the owner.
I’m like, I’d love to sell some product here.
And of course they’re good people and, you know,
it starts there.
And then in the theory, so it’s like,
if it’s going to be successful at one CrossFit gym,
why wouldn’t it be successful across others?
And so.
– What, what, what, did it taste good?
So I eat RX bars all the time, by the way, I love them.
But like the first time you open it up,
you, it looks different than a granola bar.
You have to get used to like it being made out of dates
and it being dark.
What do they say at first to the dark bar
and were they, were they any good at first?
– Yeah, it’s, so they’re, they’re really good at first
because they’re made to order.
So we never carried any inventory.
So everything was super fresh.
So that certainly helped.
And the customer back then was all paleo people
who were very familiar with LaRabar.
So there was a familiarity to it that was helpful
for the adoption.
– And I think we had this guy from FitAid come on.
– Yeah.
– And he did the same thing at CrossFit.
He used CrossFit as the initial distribution for same reason.
He’s like, I don’t know how to get into retail,
but I know this community, I’m in this community.
And he, what he realized was he gave them mini fridges.
He’s like, they didn’t have a fridge already.
So he’s like, cool, I’ll give you the fridge,
but then you like stock my stuff in there at the beginning.
And if you want to switch it out later
and put other stuff in there, fine,
you get to keep the fridge,
but sure enough, they just like kept it going.
And he used CrossFit to get to like, I don’t know,
$20, $30 million a year in sales, you know,
CrossFit is the main engine that they think at the time.
– And same for us.
And we, we’d merchandised on top of his refrigerators.
(laughs)
So you go and you’re, so you like,
if this works at one, it’ll work at many, then what?
You’re just knocking on doors every day?
Like what was your schedule, what was your life like?
– We wanted to get data on convenience stores,
grocery stores, other places of distribution
that are to get an understanding.
And so we, we tested at all those other areas
where we’re more like normal markets
where there’s very regular competition
and the brand didn’t work.
So like velocities at a CrossFit gym
would be maybe 80, 80 bars a week.
Whereas the convenience store and the local grocery store
was like one or four a week.
So what, obviously we would just rather be
in every CrossFit gym or in the country
prior to any other distribution.
So we were just laser focused on putting the product
where it’s successful and meeting the customer or the shop.
And the whole plan was like,
let’s just get to scale through this,
this early adopter and this, this market.
And then let’s figure out how to cross the chasm
once we have some scale
and we’re commercially produced around the kitchen.
And so that was a plan to like beat a bar of CrossFit,
get some scale and then figure out across the chasm
once we’re close to that size.
– I kind of triangulated a bunch of articles
and like your revenue was like something like $2 million a year
and then like $7 million and then like $160 million
or something like ridiculous like that.
Is that accurate?
And if, and if that is accurate,
I think that coincides with like the rebrand
making your rebrand or your new labels
the greatest value creation like to ever exist.
– Best use of designers.
– Yeah, yeah, absolutely.
Yeah, basically it was like .com and Amazon’s for three years
and we’d like put our foot into some retailers
and the current branding or the old branding didn’t work.
So it was like didn’t have product market fit
where we, where we, with our core early adopters
wherever we started to go to just like the mass market
or not our core, it was like it doesn’t work.
So basically we timed the rebranding with retail.
And so there was a year before the 160 one that was 36
and that was basically like getting into
call it early adopters of food retail.
So the Wegmans and these like Publix,
these regional ones that are really high quality.
And then once that works, the larger ones adopted.
And so it was like 36 and then most of the market at 161.
– So seven, 36, 161, that’s insane.
– Well, the most insane thing is actually like just
where we were, we use profitable sales to finance the growth.
Like there wasn’t like a big equity check
that came in that finance inventory.
– So how does that work?
Cause that scaling is so crazy, right?
Even the, even if you’re super profitable at seven,
how do you buy inventory for 36?
Did you have a really fast turnover or a line of credit
– Line of credit personally guaranteed by your parents
for 400,000, but we actually didn’t dip into it,
which is funny.
So that’s nice to give you confidence.
– And you started the business with 10 Gs, 10 grand.
– Yeah.
– 5,000 each.
– Yeah, it’s brutal.
And then such as Profitables.com, they give you cash.
You ship product.
So it’s a cycle is much better.
And then it goes back to like sales cures all, right?
We talked a little bit about the rebrand before,
but who, who did that?
You did that, you hired an agency to do that.
Like what was the genius behind that rebrand?
Cause this was, this stood out to me, you know,
from moment one, and it sounds like I’m not alone
that this helped like explode sales in outside of CrossFit.
– Yeah.
So we, we hired an agency called Scott Victor,
very talented brand strategist.
But I think something I want to mention
that’s really, really important that,
because I get a lot of people coming to want to do rebrands
all the time.
And they’re so fixated on the agency
that they think the agency comes in and does it.
But really the responsibility and accountability
goes on the brand owner to articulate the problem to solve
and to communicate it in a brief for the assignment,
for the creative to figure out how to solve the problem.
– What did you write in that brief?
– So, so like the output of our design is very simple.
Like we had a name problem.
Rx meant prescription in the mass market,
but in CrossFit it meant doing something of a high standard.
So in the language, in the culture of CrossFit,
doing something Rx, it was language.
So if you did a workout for first question you get is like,
did you do it Rx?
And so it had a different meaning in this,
this culture than it did the normal American culture.
So, so that was a problem, name problem.
And then it was very clear Rx meant nothing
and it wasn’t a valuable name.
You remembered it, which was nice,
but it was a source of confusion.
Okay, so you pull that through to the design.
It’s the logo and name is very small.
So we minimized it.
Second, we have, when you formulate a product
that’s minimal ingredient and you could,
and like design the way ours is,
you can claim anything gluten-free, soy-free,
dairy-free, high protein.
Well, let’s go on.
None of that mattered when we sampled it to people
and the only thing matters is when I flip over the back,
it’s A to R expert, like what is it?
And be like, it’s like eating three egg whites,
two dates, six almonds, four caches.
So that backup label thing that I referenced earlier,
that was a value communication.
And second, we’re in, the third point,
we’re a protein no man’s land.
The market was at 20.
We’re at 12 grams of protein you’re talking about.
Yeah, so we’re kind of like,
for protein people they’re like, yeah, that’s not enough.
But if you just lead with egg whites,
so three egg whites is the first thing,
that’s like our hierarchies, actually three egg whites.
And so that creates a lot of consumer surplus
because when you go shopping at a cafe for breakfast
and you get egg whites, you get charged a premium.
So egg whites are associated with premium,
they’re associated with quality, and they’re more expensive.
And so that was a great way to communicate
sort of value and surplus.
So all these things are in the brief,
like name doesn’t matter,
here’s the only thing that matters.
We don’t wanna be paleo-positioned
because that is a death trap, it’s a laziness trap.
And so all those factors are laid out in a brief
and then the designer really extracts,
synthesizes and pulls that out.
And they’re not just a designer,
they’re like a brand strategist.
So it’s very important for like any entrepreneur,
like it’s not just, you gotta do the work
and actually define the problems.
And then you bring in an agency.
– You, now you have this thing,
which I feel like you did an amazing job on the brand.
I think we talked about this on the pod.
We’re like, dude, did you see the RX guy, he’s back,
he’s got this new bar, love the name,
love the branding, right off the bat.
– Can I read out some of these words
from the lines from his site, Sean?
– You copywriting on the site, yeah, do it.
– It’s beautiful.
Your new thing is a protein bar.
And the whole shtick is that like quest,
which is like a leading protein bar
is only 20 grams of protein, but 150 calories,
you’re roughly 150 calories in like 26 or 27 grams of protein.
And so the copywriting in the website is beautiful.
It says the genius of a product is it has the protein
of a meal, but the calories of a snack.
We thank our predecessors in the protein industry,
but we’ll take it from here.
Meet David, your protein bar, idealized.
I saw the angel at marble and carved it
until I said I’m free.
All these, these are all like Instagram quotes
or a copy on the website.
Be beautiful.
Protein is essential to maintaining your skin’s firmness
and electricity and hair and scalp and nail health.
It participates in practically every process
of a cell in your body.
So you’re explaining how important the protein is.
But then you have this one line where it’s,
you like have this graph on your website
where you say how many grams of protein per calorie.
And you include Quest and Luna, I think,
and a couple others or Laura Barr, something like that.
But then you even include cod, which I thought is ridiculous.
Because when I saw that graph, I was like, wait,
you’re telling me that David is even more protein dense
per calorie than cod.
And so it’s quite good.
Oh, here’s the part that I love.
You say, you know, we are a company
that is here to make your bodies better.
We’re going to give you protein.
And it just so happens, some of our products might be edible,
but some in the future may not be.
– We focus on making, we build tools to help you
increase muscle and decrease fat.
And so that can come in, I think, that’s our mission.
So whether that’s food, beverage, or apparel,
or that’s what gives us permission to go create and serve.
And that came from like my observation
in the nutrition bar space is like,
that’s the most fundamental thing people want.
So we want to deliver that in the best way possible.
– The thing that would be the most fun for us
is if we got to sit down with the founder of RxBar
and just shoot the shit brainstorm business ideas.
And we asked you beforehand, we said,
hey, this is what we like to do.
Are you the kind of founder your brain never turns off?
You’re always seeing opportunities
that somebody could go do.
But you sent us a little list.
So let’s start with that list.
And I think the fun way to do this is,
I’ll just read the name of the thing you wrote.
You didn’t give us any details.
And you kind of pitched the idea
of what you see as a potential opportunity here.
So idea one, vasodilator.
– Yes, okay.
So I’m a big, I think history is really important
to study in business.
Like I think it doesn’t get enough credit
to like look for the patterns in history.
And in two, so for this one in 2003, four, and five,
I was in high school.
This product called NO2 came to market
and it just blew up the supplement industry
in a good way.
– Pre-workout, right?
– Yeah, I was like saying you got these like big pump.
– Was that like NO Explode?
– That turned into NO Explode.
– Me and Ari were just talking about it.
She said she like strict a pre-workout.
And I remember the days of taking that
and it would like make me NO Explode on my butt.
Like it was like the worst.
It was like cocaine, except it would make you diarrhea.
– Yeah.
So what happened is people started adding
different features to it,
but it has like having healthy blood cells
like really important.
And if you look at the market today,
it’s like super, I call it like chains and gains,
like screaming to not a sophisticated audience.
Like it’s just for pure gains.
And so I would say there’s probably an opportunity
to sort of commercialize something
on just the broader benefits of healthy blood flow.
And it’s like, for example, for men,
like ED is a huge one.
Like I think the positioning of the market,
I think they’re all very, very, very bodybuilding oriented.
And I think there’s one for like pedestrians.
– Did you remember the one, Sean,
the deer one that the, let’s like, it’s like–
– Bucked up.
– Bucked up.
– Yeah.
– Well, yeah, exactly.
It’s sort of like analogous to dick pills in gas stations.
– Versus hens.
– Yeah, versus hens, yeah, exactly.
– There was a guy who came and spoke
at one of Sam’s conferences.
He created, Sam, what’s the guy’s name?
He created the Method Soap.
And then he’s created the Band-Aid brand.
And they created Oli gummies or whatever like vitamins.
– Yeah, air frying. – Air frying.
– That’s the guy.
He’s created three brands
that are all like big in target, different calories.
And he talked about, he goes, what I could do,
I could just walk through a department,
like a store, like a target or a grocery store.
It’s like, what are you looking for
when you’re walking through those aisles?
He goes, I’m looking for a sea of sameness.
– Yeah.
– And anytime I see a category on his shelf
where they’re all positioning,
they’re all chasing the same target
or they’re all positioned the same way.
So for example, he said, Band-Aids.
Band-Aids were all sort of boring, neutral,
try to be the color of your skin, blah, blah, blah.
So they made a Band-Aid brand that was the opposite.
It was like very loud.
It’s a badge of honor for a boo-boo, right?
Or vitamins looked a certain way.
They came in and tried to do it differently.
So do you have a similar sort of philosophy
where you see, let’s say, these vasodilators,
like they’re all broed out.
And you’re like, if I just repositioned the same product,
I would have a new audience.
– Yeah, I think Eric’s strategy is very much design-oriented,
like differentiation through design,
and that’s like looking for.
I don’t have a clear of strategy.
I just really focus on differentiation
and actually like determining how competitive a category is
and how easily you can differentiate
with what I call like valuable novelty.
– Sorry, does that mean that you actually
want it to be the most competitive
so then being very different?
– Yeah, yeah, so it’s like,
you want it to be perceived as very competitive,
but then when you actually apply some rigor,
look at it, it’s actually not that competitive.
Like the protein mark is perfect example of that.
Like barrier entry is pretty low, lots of noise.
On the surface, extremely competitive.
So if you look at it, there’s actually like three
and then a long tail.
And that’s, you know, it’s like,
you want it on competitive market.
And so like, where can you find an uncompetitive market
in a competitive, like in a perceived competitive market,
I’d say, ’cause like a food leverage is like,
it’s too easy to, it’s just the low,
easy to make food, like relatively.
So it’s an unavoidable, like of course, everything’s competitive.
– Hey, let’s take a quick break to talk about
another podcast that you should check out.
It is called The Next Wave.
It’s hosted by Matt Wolf and Nathan Lanz
as part of the HubSpot Podcast Network,
which of course is your audio destination
for business professionals like you.
You can catch The Next Wave with Matt Wolf
and he’s talking about where the puck is going
with AI creators, AI technology
and how you can apply it to your growing business.
So check it out, listen to The Next Wave,
wherever you get your podcasts.
– Yeah, it’s like Peter Teal, Peter Teal talks about
the best investments are ones that seem like bad investments,
what are actually good investments
and the things that seem like good investments
but actually are good investments,
the returns aren’t even there.
So you need that sort of,
you need to be counter consensus,
meaning you need to find something that looks one way,
but is actually another.
So you’re saying, looks super competitive,
but when you sort of break it down,
you realize actually there’s a pretty big opportunity
that it’s not as competitive as it looks on the surface.
– Yeah, I mean, yeah, exactly.
And it’s just simple, like people will come to me,
oh, protein bars are so competitive.
And I was asked, tell me about that,
like how, you know, you just ask a couple of questions.
And it’ll be interesting, they one can’t either.
– What are those questions?
What are the questions? – Tell me, please explain more.
Like what do you, they just can’t explain the competitors.
They’re only referencing the volume of the category,
like the volume of brands,
but they’re not necessarily actually referencing
what they like, who’s good, who’s not.
And then second, a lot of times
they’re not even consumers of the category,
which to me is the opportunity.
It’s like, all right, well,
why aren’t you the consumer in the category?
It’s some dissatisfaction with taste or texture usually,
or price or something else.
And so that’s the opportunity actually.
It’s like, how do you bring new people to the category?
So, yeah, just stuff like that, it’s just funny.
– That’s cool.
So let’s take this visa dilator thing for a second.
In the first 90 days of that,
what would you be doing to figure this out?
Like, what do you actually go do to get these answers?
– Oh, so first I’d figure out,
I’d look at those literature and is it good or like just,
so it’s like two searches.
One, what does the internet say?
Like, what is the reputation of it?
What does culture say about it?
And then two, what does the actual literature say?
So like, what is the,
what are the ideas of the world?
What is human being?
Wayne Norton, what do they believe
through through syndicating the actual literature?
– So does that basically just mean like,
like is the perfect blend of that?
Like a vasodilator is good.
And then you also see like EnoExplode looks way too bro-y
and is lame or–
– Do you want yes, yes on the culture?
Or do you, why, why the two,
what are you looking for is the perfect answer
for those two?
– So on the cultural thing,
is it, second would be like a landscape,
like what does the market look like?
But before that, it was to say,
is this a reputation that I can overcome?
Is there some sort of stigma that is,
it’s good if it’s okay if it’s contrarian,
but is it actually something so bad
that I can’t overcome it?
Or like, what is your reputation just general?
And then second would be like,
or what’s like this market map?
Like, how do I define this market?
And I, what I know, I probably just defined it as
simply like bodybuilding oriented.
There isn’t actually a continuum of like,
you know, natural people, bodybuilders.
Like that’s like a natural opposing continuum.
But, yeah, so just to study the market,
reputation of the market.
And then most importantly,
’cause if the market says this is bad,
then that it’s, and but the literature says
it’s really has all these benefits,
then that’s a contrarian thing of like,
all right, people disagree with you, but then there’s.
So it’s sort of triangulating those things.
– Sam, you invested in Lucy, right?
– Yeah.
So Lucy, the nicotine gum,
our buddy John Coogan’s involved with it.
– And now it’s a pouch.
– Pouch, yeah, they, at the time,
I think the sort of cultural stigma,
there’s a pre-Zen being really popular was,
– Yeah.
– Nicotine equals bad, right?
Aren’t we supposed to be not having the cigarettes bad?
Nicotine bad, blah, blah, blah.
Science actually showed that there were some,
I guess some benefits.
And then what they did was they were like,
cool, can we overcome this?
And it took actually many years,
but the business is now exploding.
But for years, it was kind of,
just trying to get enough momentum culturally
to get over the hump.
– Yeah, and that’s sort of like the Peter Teal’s approach
to consumer is actually how you make money in this business.
And there’s plenty of examples like kombucha,
protein bars are constantly this,
’cause no one thinks there’s too many of them.
Collagen was one, nicotine’s one.
– You know another one that’s happening right now?
Creatine.
– So creatine, the science is one
of the most studied supplements of all time.
It’s like, there’s so many benefits.
But for years, it was like,
this is only for football high school bros.
Like, you know, and now we’ve made it cool.
Or now like women are like,
no, there’s actually a lot of benefit here
or normal average joes.
Like there’s a lot of benefit here.
The whole creatine movement, Sean,
have you seen that right now?
– Yeah, definitely.
– Yeah, I would say like the way you figured out
is just ask your friends like,
hey, what do you think of this?
And it’s like, oh, it’s sort of that’s,
and that’s like cultural reputation.
– Right.
– And that’s people who kind of disagree with you.
So I had that say generally,
like if you were to ask what my pattern is
for sort of consumer investing, it’s really that.
Like, what is something on the fringes
or what is something people disagree with
or is it in culture that actually,
if you look at it from a first principle perspective,
there’s actually something there.
– So let me ask one more question
before we move to the next idea,
which is I’m a smart guy.
I can almost talk myself into anything
or talk myself out of anything.
I have a very good debater in my own head.
And so what you’re giving examples of is maybe things
that are misunderstood or it looks competitive,
but actually it’s not.
I can almost see myself justifying anything
under that umbrella.
Yeah, hey, Peter kind of said this
and I just don’t have the actual judgment
to be able to do it correctly.
– What’s an example of an idea, Sean, of our product?
– Well, I actually want to ask you about the opposite,
which is like, what are categories
that you think you would like run away from?
You’re like, no, no, this is the type of thing
I wouldn’t go into for these reasons.
– Fast, anything fast-following.
Like following liquid death, following Alipop.
You gotta be the first one
in the controversial disagreeable thing, you know?
– Yeah, ’cause you’re trying to win big.
And I think I’ve read something the other day,
like in the AI category that Sequoia was talking about,
they’re like, if you just study all markets,
the market leader, so whoever becomes number one
of a new category will take something like 75%
of all the profits, 50% of all the revenues and whatever.
It’s just like, the spoils really do go to the winner
if you’re trying to win the biggest.
– And I think you could be looking at history.
And this is why I think history is something
I just think is so important in studying consumer.
Like that would be true with,
that would be true with Kombucha College and Market,
these sort of big breakthrough new markets that emerge,
like the first one to do it well takes all the profits.
– Are you, when you say you’re studying history,
what does that mean?
Like you’re reading biographies,
you’re looking at old financial statements,
what are you doing?
– It might be like one would be looking
through your phone at the old category.
So like what did photos of the category look like in 2012?
But for me, it’s my own just experience going through it
and remembering, the different trends,
the different new products that,
and just keeping that recollection of that.
And I think it just isn’t talked about
when I see people starting consumer brands,
they’re kind of like, oh, here’s today, here’s the future.
It’s just such an important piece of like in the equation
of whether this is gonna work or not.
But yeah, I don’t,
there’s no writing books on this stuff and no one cares.
So it’s really, you have to just-
– You have to piece together your own history.
– Yeah, piece together and yeah.
– All right, let’s go to idea number two.
I don’t even know what this means.
Night occasion in general.
Is that an idea? What is that?
– Okay, so again, I feel I feel myself
as like an anthropologist.
So if you look at the morning occasion,
it is very fixed, right?
It’s all around coffee, waking you up, sunlight,
sunlight observation is a new one.
Thanks to, I think it’s a big change culture in that way.
So circadian rhythm, taking supplements,
maybe your morning pills, whatever rituals they are.
The morning occasion is kind of like clear in terms of like,
what products or services are there?
And so sleep hygiene and the sleep occasion
is something that’s become very clear.
That’s super important.
And if you look at that, to me, it’s a wide open,
like there isn’t a coffee of the sleep occasion.
At night, you have what, like magnesium maybe
or something like that, right?
It’s like one maybe cat product.
– Yeah, no one’s owning it, right?
Now you brush your teeth, right?
So there’s like cold gates, got it.
But like, there is a huge opportunity
to sort of be the brand for that occasion.
There’s some obstacles, obviously.
But to me, that’s like, if I’m an entrepreneur,
I’m really studying that.
– That’s a strange insight to have.
What made you get to that conclusion?
– You just gotta think about everything’s occasion based,
right?
The best example is like champagne dominates
a celebration occasion.
Outside of that, it’s a terrible problem, right?
– Or for RX bar, it’s like, I’m driving somewhere.
I’m going to a gas station
and I wanna get something healthy.
– Yeah, like RX bar was obviously on the go,
it was a big occasion.
But to be honest, it was because of the egg whites,
there was some signals, it was breakfast.
It was sort of like a great, fast breakfast.
But I think about like everyone’s talking about sleep.
You have eight sleep, you have all these brands
kind of getting there, but on the consumers,
like the food or beverage or supplement side,
there’s all these like sleep packs, things.
But the real opportunity is like,
how do you be the coffee of fucking sleep?
And that’s where I would spend time.
You know, coffee is the best drug, it’s the biggest drug.
So is there something like that?
Now, there’s some brands working on it,
but I think there’s–
– Which promising ones?
– There’s one called Moon Brew,
there’s one called Beam.
I use both of them.
One is melatonin, one doesn’t.
That’s the big controversial one.
Melatonin is actually sort of,
you could have melatonin is actually
something that could be contrarian.
People say it’s bad for you,
it’s habitat formates, exogenous hormone,
but then there’s also literature
that’s tying antioxidants to.
Those are good, but me and my fiance,
we find ourselves having this beverage
at a small dose before bed,
and it’s like a nice ritual.
– Yeah, I think that’s brilliant actually.
The, basically like looking at moments
and looking for openings.
There’s a Chinese company,
I think it was, maybe it was ByteDance,
the company that owns TikTok,
maybe it was the one that owns WeChat, not sure,
but they, at their annual meeting,
I remember going and watching their annual meeting,
which was weird ’cause it’s all in Mandarin,
I don’t speak Mandarin,
but I’m sitting there trying to translate these slides,
’cause I was like, I wanna learn from,
where other people are not learning from,
to try to see if there’s any alpha there.
And one of the interesting things was they,
their opening slide was all of the moments of the day,
like so a 24-hour cycle, broken into 15-minute intervals.
And what they did was they were like,
“We wanna have a product or an app
“for every moment of your day.”
– Okay.
– This was like totally dominating philosophy.
– That’s insane.
– American companies, you couldn’t come out and say it,
but like obviously, Zuck probably feels the same way.
– Yeah, yeah.
– But they were like, “You’re in line for coffee,
“what’s the inline coffee app?”
Like we need an app that is designed to be awesome
for that moment.
Okay, now you have an hour in bed scrolling at night.
What do we have for that?
That’s like the TikTok app
where you’re just gonna infinitely swipe and be amused.
And so seeing them think that way,
I was like, “Oh, wow.”
And then that creates white spaces.
So you say, “Oh, you might think photos
“is a crowded category.”
Like it seemed like photos was dominated
by Facebook and Instagram and the Snapchat came out
was like, “Oh, we’ll use photos for messaging.”
And instead of photos for memories
and the way they just looked at it with a different lens,
suddenly photos was totally a wide open
multi-billion dollar opportunity
that you had to look at it in some other angle
in order to see it.
– Yeah, and I would just emphasize like
the consumers all in matters.
And so putting yourself in empathizing and going through that
is where it all starts, in my view.
– Yeah, like that.
Do you also look for like product inspiration
from other places?
Like I know some people that do CPG
that they travel a bunch or they’ll be like,
“Oh yeah, in Thailand they drink this.
“What is this?
“If we just take this and now we wrap it in a new label
“that’s like American friendly,
“we might be able to have a product here.”
– So basically you want to consume as much information,
collect as many dots so you can connect the dots
at some point.
And the best example is that is like I had an internship
in Belgium and we supplied Innocent Beverage,
which is a smoothie company.
And in their label, the innovative thing they did
is they would, and their greening statement would be
like one apple, one banana, and half a lemon
or a pinch of lemon.
And obviously I took that dot and connected it to our X bar,
which on the back of our label was two dates,
three eggs, six almonds, four cashews, et cetera.
But that insight was from just purely observing
different markets and different brands and different forms.
– You’re just like journaling or to keep track of these
or it’s all just in your head?
– It’s in the way.
– Yeah, it’s just in the way.
– All right, let’s finish up these ideas
that I want to ask you about the bar businesses.
All right, so idea number three,
continuous testosterone monitor.
This is very fascinating.
– Oh yeah, yeah.
I think the American male cares so much about testosterone.
And I think, I don’t know if this is feasible.
Maybe we do blood tests.
So, and I actually like looked into this for like 10 minutes.
But if you were to have some way to measure testosterone
or some broader hormones in a continuous way.
So like when you wake up in moderate,
like I think there’s a lot of demand for that.
And I think the American male was loved that.
– Sam, you’re the American male.
What are your T levels right now?
– Dude, I want to know my T 24/7.
– Are you 400, where are you at?
Is it higher than your math SAT score was?
– Or?
– That’s the test.
– I don’t even, what’s the SAT out of?
I don’t even know.
– Well, do not get, you don’t get yours checked, Sean.
– I’ve never got, I don’t think,
maybe I got to check once.
I don’t think I’ve ever really,
I definitely am not the typical American male.
– Wait, Peter, do you have, you get yours checked?
– Yeah, I do quarterly.
– Do you have, by the way, I’m,
what’s an investor or AM an investor
and that thing called levels,
which you can continue as glucose monitor.
And like, yeah, everyone has to figure this out.
And if you do figure it out, it’s pretty awesome.
But do you have some like,
because you’re friends with like,
I think Peter Tia is one of your investors,
because you’re, you’re a young rich guy in the health space.
Do you have some crazy Brian Johnson setup
where you have someone measuring your night time erections
and all this crazy stuff?
– No, I’ve, so I’ve gone from like,
getting close to be obsessive about measuring everything
to just now I’m like, totally, it’s like so easier to do it.
My routine is, I’m currently off supplements right now.
I just want to get a baseline of my blood markers.
I test it quarterly.
And then normally I take supplements in the AM and PM.
– I think, I think culture is going that way.
This is my, this is my prediction for 2025,
which is that I think everybody got a really inspired
and sort of over-analyzed everything
through Huberman and Brian Johnson.
I love those guys, but I think the average person,
it’s way too much work for way too little payoff.
And we all kind of know the sort of core four or five things
you should do, and most people don’t even do those.
And so without doing the basic fundamentals,
like none of the rest really matters.
The sort of fine tune optimizing.
And so I think there’s going to be a giant retreat
back to simplicity and basics for like health craze.
– So for the listener, Brian Johnson is like a tech
billionaire who likes the headline is he spends $2 million
a year on his health to live forever, whatever.
He’s got this thing called the rejuvenation Olympics
where you can get your bloodwork done.
And it ranks you like on amongst tens of other thousands
of people to let you know like how good your bloodwork is
and how long you’re going to live, whatever.
There was this woman in the Wall Street Journal.
She was like a substitute teacher.
And she’s like, she’s like says her income.
She’s like, I make like $50,000 a year.
And I just go for walks and I eat healthy.
And she was number one on the list.
And like Brian Johnson was like number six.
And it was pretty funny that all these guys are dedicating
their lives and all the resources.
– Yeah, actually it’s just bingo night
that you need for the community.
– Yeah, and I think it actually causes
like you emotional regulation and not being stressed
or anxious is probably more important
than like obsessing about some other stuff.
So.
– Exactly.
All right, let’s do the most exciting idea
you have on this list.
New religion.
Talk to me, I’m ready.
Preach.
– Sort of like religions, I think it’s a bad word.
It’s like something to belong to
that helps you guide morality and ethics
that can be a ritual or tradition
that we all can like bond over and feel aligned on.
My hypothesis is that there’s no money to make in religion.
So no one joins, no talent, no good leader joins the church.
And therefore it hasn’t been innovating at all.
And therefore, so the economics aren’t there for a priest.
And so therefore there’s no innovation
and there’s a desperate need for innovation.
And then second, like no one wants to be Jesus
and someone has to be Jesus.
That’s why I think why we are where we are at right now.
So if someone wants to be Jesus,
I think there’s a real opportunity.
(laughing)
– Have you guys ever gone to a Shabbat?
– No, something like that.
– Dude, Shabbat is great. – It’s the shit.
It’s the best.
– Shabbat is the shit.
I love it.
It’s like basically a Friday meal
where you don’t use cell phones and you tell everyone
how much you love each other.
– Yeah, and like Saturday I’m not working, like forced.
And I just think that’s the obvious, we bought that.
– Why are you saying there’s no money at all?
These mega churches have a million dollar run rates.
The priests are driving private, flying private jets.
Like, have you seen Joel Osteen?
That’s a billion dollar smile right there.
– So I think maybe it’s like actually the best business
of all businesses.
(laughing)
– I’m pretty sure that the Catholic Church
is the largest landowner in the whole world.
– Not to reference Peter Teal again,
but he talks about for monopolies.
He’s like all the companies that talk about how,
how much of a monopoly they have, how dominant they are,
they’re usually the most vulnerable.
And the ones that are super dominant,
always trying to downplay how dominant they are
’cause they don’t want anyone to take aim at them,
you know, for antitrust.
It’s the same thing I think for money.
It’s like the folks that are bragging about
how much money they make are the drop shippers.
And then the people who are silent pretend
it’s not about the money, have all the money,
and that’s the churches.
– I think it’s probably totally right.
So I misread this, but maybe I should be a priest.
– Well, I’ve thought about this a bunch of ways.
I think you can either unbundle it.
So, you know, one strategy for business is unbundle things.
So take things that come in a bundle.
So you get God and a higher power.
You’re gonna get community and a Sunday ritual.
And then you’re gonna get an operating philosophy for life.
And so that’s the current religion bundle.
And then then you see things like, you know,
look at the NFL every Sunday, look at SoulCycle,
look at these things where it’s like,
oh, they’re giving, they have two of the components,
but not the other three, right?
And then there’s Tony Robbins.
He’ll maybe give you the operating philosophy without God.
And for me, for example, that resonated.
I was like, cool, I want this without the,
but I, you know, I’d like to be in charge of it
and not sort of say it’s somebody else
that’s deciding my fate.
And so I think some people have unbundled this,
but it would be very interesting to see somebody
actually try to provide a new bundle.
And I think, I think you could really just like,
it’s a first principle approach to be like,
across the different domains of life,
like who’s got it right?
Like the Buddhists have got stuff right.
The Jews have got stuff right.
Sure as long as you’ve got stuff right, Christianity too.
And just sort of built like,
sort of look at it from that perspective.
I bet you’d come up with something great.
– You actually have a,
it appears to be a fairly academic point of view
when it comes to operating a business.
And I think that that’s actually pretty cool
because I think it’s considered like cool to not care.
Or like, I’m just going to file my gut,
which I tend to fall in that category.
But to hear your kind of academic point of view,
I actually think it’s pretty neat.
– Thank you.
(laughing)
– I wouldn’t call it that, but I guess for your,
yeah, I mean, I just, it’s like,
I’m a terrible student, but I study a lot.
– What does that mean?
– I was like literally a terrible student,
but I do, like all I do is my free time is study.
– Yeah, it’s actually nice for me
because I kind of, I do the same.
And then sometimes I meet people
who are 10 times more successful than me.
And they’re like, yeah,
I don’t even think about all that stuff.
I’m like, oh wait, am I wasting my time?
But you’re like, oh yeah, we looked at this.
It seemed like really good distribution.
Or I really thought that, you know,
for the, for the design agency,
the inputs matter as much as the inputs
will dictate the outputs.
And so I was super clear on this.
Whereas like, I think a lot of successful entrepreneurs
just sort of hand wave.
And I get the sense that it’s not really as hand wavy
as they think.
And it, either they’re downplaying it
or they’re kind of like Michael Jordan.
You’re like, how do you shoot a jump shot?
He’s like, I don’t know, I just do it.
I don’t really think too much.
But I like that you’re able to articulate
some of these things because,
at least for someone like me, that resonates
’cause that’s how I think.
So, you know, it’s-
– I would, I would perhaps say like,
they’re not as introspective.
They’re probably not analyzing why they came up
with what they came up and they’re probably not,
they’re just like, I think a lot of entrepreneurs
are all about like charging forward and moving forward.
I’m always sort of like looking back
and studying the past of like, why did this work?
Was it a framework?
Can I come up with a framework?
Was it a pattern?
– Well, let’s do a little introspection on why do David?
Because you’ve, on one hand, one way of looking at this
is you’ve already beat this level of the video game.
You created a protein bar, you won $600 million.
You get the nice house in Miami and it’s all done, right?
And of course you could go back and do it again,
but maybe like, you should do a new thing.
That would be one argument.
We, me and Sam have talked about this before.
There’s two, you know, type one, type two entrepreneurs,
type ones are always looking for the variety.
The next new thing, even though they’re most equipped
to actually go do the thing that they know really well,
they don’t want to do it.
And then there’s other people we call speed runners,
this type two, which is, now that they feel like
they have a new point of view, a new mastery of the game,
they’re really excited to go do it.
This is just in their blood, it’s in their DNA.
They just want to go back to the same space.
I don’t know if it’s as simple as that,
but why did you decide to do it again?
– Yeah, so it was in process.
So I had an odd repeat, so that was a constraint.
But then I wanted to actually prove to myself
that I wasn’t just a CPG entrepreneur,
that I could go do this in other sort of industries.
So I actually, I went to go explore different industries
and try to like, and I kind of like started and stopped
and a lot of times.
– What sorts of stuff?
Give us a sense.
– Like synthetic biology, I think is like fascinating.
That’s a perfect example.
I was like, this is sounds like science fiction,
biotech is incredible.
Like if we can actually control biology,
like this would be an amazing thing.
So I started studying it, and you know,
this is where I think like Elon’s like a,
not a good influence.
Like I was like, oh, he like, I can like learn anything.
And then very quickly it was like,
I can’t fucking learn this stuff.
Like biology, these people like spend their whole careers
learning this, and I was like, I’m not that smart.
I can’t learn new things.
And I’m never going to start a business
where I have to pick up the phone to fix the problem.
Like if I can’t don’t have the competency
to fix the problem or understand it,
it’s like a position I’ll never want to be in.
That was a bit of like self-awareness,
call it a humbling moment.
And then I spent some time that I came back
and then when my non-compete came up,
I was like, oh my God, I see it.
Like I couldn’t help but see like a vision of something to do.
And so I was like, you know what?
I’m okay, I’m okay with just being called a type two.
And I’m okay.
Once I die, it just says like, nose protein bar.
You know, like, watch what I’m going for.
My gravestone, that’s okay.
Like, and it goes back to like self-awareness.
Like you got to do what you’re good at.
And like, one thing I’ve learned is like,
as I got older, I’m 38 now.
Like I do find it harder to learn new things.
Like I’m a later adopter.
Why do it again is like,
I see a huge opportunity to bring,
to grow the market, to delight customers.
And it’s far.
– Are you calling the shots?
Are you the CEO and are you like a very hands-on CEO?
Or are you doing it?
– Are you chairman?
– No, I’m the CEO and I’m in the office every day.
I’m at manufacturing right now.
I only have one way.
– So here’s the deal.
I made most of my money from a newsletter business.
It was called The Hustle.
And it was a daily newsletter at scale
to millions of subscribers.
And it was the greatest business on earth.
The problem with it was that I had close to 40 employees
and only three of them were actually doing any writing.
The other employees were growing the newsletter,
building out the tech for the platform and selling ads.
And honestly, it was a huge pain in the butt.
Today’s episode is brought to you by Beehive.
They are a platform that is built exactly for this.
If you want to grow your newsletter,
if you want to monetize a newsletter,
they do all of the stuff
that I had to hire dozens of employees to do.
So check it out, behive.com.
That’s B-E-E-H-I-I-V.com.
– When you have a four month old kid,
it sounds like you’re gonna get married soon.
You know, a lot of people in your position
who imagine you have roughly in the ballpark
of nine figures, liquid,
that’s enough money for many generations.
You have a new kid where you could be at home with them.
Why do you even give a shit about starting this new thing?
– I think the idle mind’s a devil’s playground.
– But you’ve had an idle mind, no,
for the past few years?
– Yeah, but I still made myself busy.
But it was idle relative to it now, yes.
I just think it’s dangerous.
I need to produce, I need to make stuff.
I need stress, I need to be challenged.
I need risk.
I’m a way better man with responsibility.
And then second, I want to make sure my son sees daddy.
Working, working hard.
I need to be a role model for him.
I need to be in an office.
I need to be sacrificing.
And then at a fundamental level,
as a human, I’m not happy if I don’t,
I’m at risk on, I don’t have responsibilities.
– Does that mean you were kind of bummed out
or for the past few years?
– Yeah, I just was unfulfilled.
I was just like, being an investor sucks.
– Yeah, it’s pretty boring, isn’t it?
– Well, the only good thing about it
is you can like, you have more freedom of time
and responsibility.
Like that’s the great thing about it.
And I just don’t actually like that.
– Have you ever seen this Reddit post
by this guy Jake who started Movement Watches?
– No.
– They were one of the early DTC brands.
They made a watch brand that got really big
off of Instagram.
And he wrote this thing on Reddit,
which I think you would never expect this guy to be here.
They sold it for I think a hundred million dollars.
You would never expect him to just be lurking
random like beginner threads about entrepreneurship.
And he wrote a thread that he says,
“I sold my company for millions
and I’m lost more than ever, 31 years old.”
He says it pretty openly.
“I sold my company movement for a lot of money.
I thought all my problems would be solved.
It made my life really cushy and comfortable.
I optimized for being as stress-free as possible.
I play video games when I want.
I wake up when I want.
I have really no reason to go to bed if I don’t want to.
I always thought this was the dream
and I’d be happy forever until I wasn’t.
I realized I’m in this incredibly unique situation.
I wanted to share some things.
And then I have to, I’ll just fast forward.
There’s a bunch of stuff he talks about.
I’ve been separated from the company for two years.
I’m 31 single.
I never have to work again.
I’m also lonelier than ever and deeply depressed.
I really believe that we need purpose in our lives
to be happy.
For some, that’s raising a family.
Others, it’s their career, blah, blah, blah.
And then he goes to the bottom and he just says,
“We can plan and analyze forever, but here’s the lessons.
But there are lessons that are unknown
until you start moving forward.
You cannot live without struggle and pain.
We either choose our struggle and pain
or it will find us through depression and loneliness.”
I thought that was really powerful what he wrote.
And you, at my point, my, you said you have to work.
You said you don’t have to work.
Like you have to.
– Just not for money.
It wasn’t for money that you had to work.
It was for yourself.
– Yeah, yeah, just like, you need to produce.
– I want to bring up this article
that got written about you.
It was on medium.
You know what I’m talking about?
– Yeah, it was like a super sensationalized,
terribly upgrade and she was just projecting.
– I thought that was going to be the case.
I told Sean I was going to bring it up.
And he goes, he’s, this is what he’s probably going to say.
It, Sean nailed the prediction.
But for anyone who’s talking about,
who’s thinking about, or the article that I’m describing,
it’s basically the head, it’s beautiful photos,
but it’s kind of like they kind of paint this article
as the lost young rich guy who doesn’t know
what the hell he’s doing in life and is unhappy.
And like the photos are like you like looking off
to the distance, but there was one pretty amazing stuff.
– Dude, just pro tip for founders.
Anytime somebody wants your article at you
and they want you to take photos looking longingly
at the window, they’re about to fuck you.
That’s what they’re trying to do.
They just don’t take the photo and don’t do the article.
– The paragraph goes, so Peter Bonafoli furnished house
for $19 million in May.
He spent his time between here and Chicago.
He chose Miami because there’s no income taxes.
He has a Ferrari and a Vespa parked in the driveway.
A housekeeper who comes daily,
keeps the seven bedroom spotless.
The most are usually empty.
Like just little jabs right there.
And then she basically says,
this looks like a place that tick the box
requesting the newly rich bachelor package.
And this setup fell straight from the sky.
Just like constant jabs.
– Why?
– Dude, and first of all, I did it crazy
that you probably spent the whole day with this woman
and you probably became friendly with her
and that she just kind of like.
– Yeah.
– And in which she couldn’t like,
I’m very introverted and I love being alone.
And I never once said I was unhappy.
It’s more than like she was projecting what she would be.
Like she’s like, couldn’t imagine living here alone.
And I’m like, this is fucking great.
Like it was just like, it just shows you can’t trust media.
Like the story it was supposed to be about,
my process for finding my next business.
– But it was still a good article.
Like there was some cool insights of it.
It’s like a little bit about your background story
and the photos are dope.
– One of the things Sam and I like to talk about
when we both sold our companies,
we were like the days, you know,
there’s like this whole process of like the journey
of this thing and then you’re not gonna sell.
That’s kind of a stressful time.
And it’s just kind of like relief when you sell,
at least that was how it was for me and him.
It’s like more than what you think should be
just exuberance was actually just relief
that the process actually like finished
and it was successful.
And like your employees are all at a good spot
and like everything worked out.
But then there’s like, you know, that post exit, right?
Figuring out what you want to do, see, you know,
go to the ATM, you print out the balance the first time.
You’re like, holy shit, this is cool.
Do you have any of those moments that you remember
that were just memorable for you?
Just like unique human life experiences
that you had going through it.
That’s the first question.
The second would be like, you know,
if your cousin or your brother was going through this
or was about to do it, what would you kind of tell them?
What would you advise them now that you’ve been through it?
– Yeah, I would say that by going through the process
that took me a while to like actually comprehend the money.
– Had you taken money out of the business before that?
– No, no, so I went from basically like, you know,
75K a year to it’s like really crazy money.
So that process took me a while.
And in general, like that’s just like financial literacy.
It’s just not, I don’t have a good instincts on it
for some reason.
So it took me about a year to like realize what it was.
And then going through it, like,
I just, maybe it’s like I have kind of like low self esteem
for being dyslexic, I think.
So I didn’t think I was great.
You know what I mean?
I just don’t think I’m that special.
And then I didn’t realize like,
you just can treat it differently.
– You also were living in maybe not the most friendly
or not the most, Miami is not the best place to be, I think.
Well, you could say it’s the best place to be
for the newly rich.
Or you could also say it’s probably,
it could be a pretty bad place to live
if you’re newly rich and a young man who’s single.
Like it could be, you could go,
you become a D gen pretty easily.
– Yeah, if you don’t have discipline,
it’s a really dangerous place.
But it’s actually a great place
’cause there’s a lot of high network people there
that you actually can learn from.
The issue with Miami is that there is no residue
of the actual building, it’s just the outcome.
So you don’t see the office,
you don’t see, you don’t hear the stories,
you just see the outcome.
And so it was a bunch of like,
it’s, yeah, it’s a byproduct of all that.
You don’t see any remnants of the process.
And so that’s what’s dangerous about Miami
on wealth management.
And I would just define the different sort of options.
Like you can go with Goldman, they’re gonna feed you,
they’re gonna make you feel good.
Just go through sort of like how to manage this money.
‘Cause that’s what you need to get.
You immediately need to figure out what to do
and how to do it.
And there’s sort of like different categories
and approaches based on your risk appetite
or what you want to do.
So that’s what I wanted to help with.
And I would help someone is like,
here’s how you should think about it.
And here’s how like help them not waste their time.
– All right, I want to ask you two questions.
First one is real simple.
How big can this be, David?
As I’m 75% of way through this ball right now.
– I would say how big, so the market,
I think it’s like a say $8 billion TAM,
the protein subcategory.
To me, the big exciting opportunity
is to convert non-protein bar people
and bring them into the category.
So like just interviewing people,
they’ll often say, I’m not a protein bar consumer.
So I want, if we can achieve the mission of bringing,
converting as many non-protein bar people
into protein bar people, that would be a huge.
– I see a clear path to a billion in sales, top line.
– Is that your threshold for success?
– That’s a good question.
Enterprise value, yeah, I would say, yeah,
I would want a billion in top line.
– What’s that worth?
– Depending on growth and EBITDA,
you put a three or a five on it.
– I love how you don’t shy away.
We have a lot of people that come on this podcast
that they want to win and they want to win big
and they want money and they want, they want things, right?
We all want things.
And whenever Sam will ask a question like that of like,
does that, would that be, would anything less than that
be like not a success for you or something like that?
They’ll like always go back to like,
what they think they’re supposed to say.
No, no, no, this doesn’t define me.
You know, as long as I wake up every day
and my wife kisses me on the cheek, I’m good.
And I love that you don’t give a fuck.
– And I see that in a bunch of your quotes.
We have this quote section.
I just want you to react to some of these.
My favorite, by the way.
Don’t trust a guy who celebrates his birthday.
– Yeah, I know, he’s completely through,
but I’m not against it, but it’s kind of true.
(laughing)
– You talked about how most people
don’t really experience any adversity.
And you said a quote, most people are soft as baby shit.
Expand on that.
– Yeah, I just think it’s character shit.
I think it’s like, and you were a really high character,
usually some trauma at it, a trauma’s relative.
And if you haven’t gone through trauma, that’s fine.
But just if you’re just self-aware of it,
like that’s the first step.
– You do things now, even though your life
could be very comfortable, we got a bunch of money.
You could make your life as comfortable as you want it.
Do you do things now that kind of voluntarily
make your life less comfortable than you otherwise could?
– Without sounding like a rich asshole, like.
– No, I mean, I’m truly.
– I like the rich asshole version of you.
You’ll be just all like that.
(laughing)
– He’s like, I have one butler, not three now.
– Yeah, I don’t.
– It’s tough out there.
– It’s like, don’t do it in the right words.
Like, that’s such a, you know, it sounds so terrible.
No, I mean, so I think like physical exertion
and doing physically things hard is the easiest way
to do adversity.
And that’s why you see a lot of people doing that.
And so that’s easy.
But my company’s a priority,
and the first thing to go is my health.
Like, it’s my company, my family.
My family’s probably more important now.
But like, I’m not as, I’m not.
My family’s more important than my company and then me.
And so my health is the first thing to fucking go.
– Is your new company in person or remote?
– What do you think?
– Yeah, I made the biggest mistake.
– He’s like, have you been listening?
– Yeah.
I was hoping there was like,
I was hoping there was like a 3% chance.
My company, we started it like kind of like right after COVID.
I’ve made such a mistake, dude.
We did remote and it’s like an irreversible thing.
– Yeah. If you want a high performing company,
if you want to win, you obviously have to do it.
And the thing is like, my work’s fun.
So being the office-
– Yeah. Well, that’s why I’m doing it.
I don’t care about the winning, it just is fun.
It’s fun to be around your, like to become your friends.
– Oh, and that’s the thing is like my social bucket
is fulfilled through my work colleagues.
Like, so I don’t really socialize outside of my work.
– Yeah. I mean, it’s, I was in the same boat.
You just, you give someone a job.
You’re hired, want to be friends?
– Yeah, my paid friends are the best friends I’ve found.
My W2 friends are awesome.
– Yeah.
(laughing)
– Well, dude, Peter, I know we’re a little over time.
So we’ll, we’ll, we’ll let you go.
But you’re awesome.
I really appreciate you coming on.
I think your story is dope.
I think you’re very truthful and self-aware.
And that’s a pretty deadly combo.
It’s something, you know, I think two virtues to strive for.
And I think you have a hardcore approach to this
at a time where it is unpopular to be hardcore.
You almost have to apologize for like caring and trying
and working and prioritizing stuff.
I think there’s a bunch of people who will listen to this
that want that also and will feel more empowered to do it
in the same way that you were saying like,
Elon lets you think, wait, shit, can I do anything?
Right? Like it gives you permission to like, you know,
to be a certain, to be the way you want to be.
And I think you’ve done that today on the spot.
So I appreciate you coming on.
– Thank you guys.
♪ I feel like I can rule the world ♪
♪ I know I could be what I want to ♪
♪ Put my all in it like no days on ♪
♪ On the road let’s travel never looking back ♪
[BLANK_AUDIO]
Episode 639: Sam Parr ( https://x.com/theSamParr ) and Shaan Puri ( https://x.com/ShaanVP ) talk to Peter Rahal ( https://x.com/peterrahal ) about starting RXBAR with $10K and selling it for $600M, business ideas he would chase today, plus why he’s back with another bar.
—
Show Notes:
(0:00) RX Bar’s path to $600M
(8:32) Branding to solve a problem
(14:03) David Protein
(16:22) Idea 1: Differentiated vasodilator
(27:53) Idea 2: The coffee of sleep
(32:28) Idea 3: Continuous Testosterone meter
(36:58)Idea 4: New religion
(42:03) Why do this again?
(45:28) How to survive the first year after exiting
(53:03) How big is David going to get?
(56:18) Remote v in-office
—
Links:
• RXBAR – https://www.rxbar.com/
• SCOTT & VICTOR – https://scottandvictor.com/
• David’s Protein – https://davidprotein.com/
• Lucy – https://lucy.co/
• Moonbrew – https://moonbrew.co/
• Levels – https://www.levels.com/
—
Check Out Shaan’s Stuff:
Need to hire? You should use the same service Shaan uses to hire developers, designers, & Virtual Assistants → it’s called Shepherd (tell ‘em Shaan sent you): https://bit.ly/SupportShepherd
—
Check Out Sam’s Stuff:
• Hampton – https://www.joinhampton.com/
• Ideation Bootcamp – https://www.ideationbootcamp.co/
• Copy That – https://copythat.com
• Hampton Wealth Survey – https://joinhampton.com/wealth
• Sam’s List – http://samslist.co/
My First Million is a HubSpot Original Podcast // Brought to you by The HubSpot Podcast Network // Production by Arie Desormeaux // Editing by Ezra Bakker Trupiano
