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Bootstrapped Beauty Entrepreneurship: Building a Clean Beauty Brand with Gabrielle Melchionda · The Growth Class with Phil Masiello

• 0:19
  SPEAKER_00: Hey everybody, and welcome back to another episode of the Growth Class.
• 0:23
  SPEAKER_00: And have you ever wondered what happens when a college student with 50 bucks from their waitressing pouch, a neighbor's beeswax, and a massive dose of grit decides to start a company?
• 0:32
  SPEAKER_00: Long before there was e-commerce, algorithms, social media ads, today's guest started mixing natural lip balms in her mother's kitchen.
• 0:40
  SPEAKER_00: She built her brand from the trunk of her car using physical maps and the yellow pages, eventually turning it into a household name featured everywhere from QBC to Vogue.
• 0:49
  SPEAKER_00: She's the founder of Mad Gabs, a pioneer of clean beauty and an absolute powerhouse of bootstrapped entrepreneurship.
• 0:54
  SPEAKER_00: Gabrielle Melchianda, welcome to the show.
• 0:59
  SPEAKER_00: Thank you for taking time to come on.
• 1:01
  SPEAKER_01: Thank you for having me.
• 1:02
  SPEAKER_01: I'm so excited to be here.
• 1:03
  SPEAKER_01: That was a great intro.
• 1:05
  SPEAKER_01: I love hearing my life summarized like that.
• 1:09
  SPEAKER_00: Oh, I try and do that.
• 1:11
  SPEAKER_00: Um, so actually I have folks that do that that do a pretty good job of that.
• 1:15
  SPEAKER_00: So um I just have to read it.
• 1:17
  SPEAKER_00: So uh why don't you bring us back and tell us that story of how you started, why you started, because you've been doing this for an awful long time.
• 1:25
  SPEAKER_01: Yeah, we just crossed the 35-year mark, um, which I would have never guessed.
• 1:29
  SPEAKER_01: So um I started by failing math, if you want to go back to the beginning.
• 1:34
  SPEAKER_01: I failed math from fourth grade on, and I was a college junior.
• 1:38
  SPEAKER_01: I studied anthropology, I was studying cultural anthropology, and I had to retake my freshman math in order to graduate.
• 1:44
  SPEAKER_01: So I had a three-week class, eight to twelve for a month of just algebra.
• 1:49
  SPEAKER_01: So I said, well, this isn't gonna work, and I have to do something fun in addition to the math class.
• 1:53
  SPEAKER_01: So I took a workshop for basic massage, didn't love the class, but found a recipe for lip balm and just tucked it away on an index card in my pocket and went home to do laundry and came out.
• 2:02
  SPEAKER_01: And my mom said, What's this?
• 2:03
  SPEAKER_01: I said, Oh, a recipe for lip balm.
• 2:04
  SPEAKER_01: And she's looking at the ingredients and she says, Oh, the neighbor has beeswax.
• 2:08
  SPEAKER_01: We could go get it from him.
• 2:09
  SPEAKER_01: And I said, Oh, okay.
• 2:10
  SPEAKER_01: So we got went to what is now Whole Foods, which was bread and circus.
• 2:13
  SPEAKER_01: We got all the ingredients and I made a batch in my kitchen and um got in the big mason jar and I gave out samples to people and they said, You should sell this.
• 2:21
  SPEAKER_01: And I thought, well, no, I'm an anthropology major.
• 2:23
  SPEAKER_01: There's a reason I am not in business school.
• 2:24
  SPEAKER_01: I'm not interested in selling anything.
• 2:26
  SPEAKER_01: I'd never even had a lemonade stand.
• 2:28
  SPEAKER_01: And uh then people kept asking for more, and I finally was like, okay, this could be a project.
• 2:32
  SPEAKER_01: This will just be fun.
• 2:33
  SPEAKER_01: So I got a roll of labels.
• 2:35
  SPEAKER_01: I had to come up with a name, and I went to a local uh coffin factory in my hometown and I asked if they had any extra wood.
• 2:41
  SPEAKER_01: So I got the scrap wood from the coffin factory and I took the yellow pages and the maps.
• 2:45
  SPEAKER_01: And the first store that sold it was the health food co-op on campus.
• 2:48
  SPEAKER_01: So I thought, well, that could be there's more of those.
• 2:50
  SPEAKER_01: So I used the yellow pages wherever I had a free free couch to sleep on.
• 2:54
  SPEAKER_01: I drove around and I'd show up on people's doorsteps with this, my mother's French, and I had this little French metal cookie tin with my lip balms, and I'd say, would you like to buy some lip balm?
• 3:01
  SPEAKER_01: And they'd say sure.
• 3:02
  SPEAKER_01: And they just kept saying yes.
• 3:03
  SPEAKER_01: So I'd go home and I'd make it and I'd ship it.
• 3:05
  SPEAKER_01: They'd mail me a check.
• 3:06
  SPEAKER_01: And that was the roots.
• 3:07
  SPEAKER_01: And my goal at the very beginning, once I knew I was actually doing this as sort of like a side hustle, they'd call it now, right?
• 3:12
  SPEAKER_01: There was no name for it, but I wanted lip balm that wasn't greasy or waxy or made with junk.
• 3:17
  SPEAKER_01: And this is 1991, and there's nothing.
• 3:19
  SPEAKER_01: So I was I played with essential oils, nobody knew what essential oils were.
• 3:23
  SPEAKER_01: And so I was playing in a space that was kind of, you know, the white, it was the Wild West.
• 3:28
  SPEAKER_01: It was, you know, there was nothing happening.
• 3:30
  SPEAKER_01: It was fun to be out there trying to explain essential oils to people.
• 3:33
  SPEAKER_01: So that was the original um impetus for the exercise.
• 3:37
  SPEAKER_00: Yeah.
• 3:38
  SPEAKER_00: And uh and so, but then you grew it from there.
• 3:42
  SPEAKER_00: But how'd you grow it?
• 3:44
  SPEAKER_00: I mean, 35 years is quite impressive to stay in business.
• 3:47
  SPEAKER_00: It it just is.
• 3:48
  SPEAKER_01: I'm a stubborn little woman.
• 3:49
  SPEAKER_01: Um, I really am.
• 3:51
  SPEAKER_01: And I am anyone who knows me from childhood on, especially my mother, would say when I get my head on something, I just I don't let go.
• 3:57
  SPEAKER_01: And you know, it gave me going door to door connected me to people.
• 4:02
  SPEAKER_01: Anthropology was all about people.
• 4:04
  SPEAKER_01: I loved the connection and the relationships with my retailers, and I loved having a reason to get in my car and drive all over the place.
• 4:10
  SPEAKER_01: Um, I started going to the Natural Products Expo West, which is where I met my future husband.
• 4:15
  SPEAKER_01: I had mentors in the industry.
• 4:16
  SPEAKER_01: Gary Hirschberg from Stonyfield was an early mentor, and he introduced me to all these founders of socially responsible business.
• 4:23
  SPEAKER_01: So, you know, I've I hung out with Ben from Ben Jerry's and Anita Roddick from the Body Shop, and they started to make business seem like a great idea.
• 4:30
  SPEAKER_01: Whereas as a kid, I was raised in sort of this, you know, I was raised in Amherst Mass, kind of this academic world where business was not in my my grandfather was a barber, but other than that, there were nobody businesses in my family.
• 4:41
  SPEAKER_01: And uh business was kind of bad.
• 4:42
  SPEAKER_01: You know, there's like the Pepsi, there was, you know, big corporations were what I thought of for business.
• 4:46
  SPEAKER_01: So hanging out with these socially responsible pioneers was really inspiring.
• 4:51
  SPEAKER_01: And I thought, well, I'll just keep doing this and I'll know when it's time to stop.
• 4:54
  SPEAKER_01: Something will make it obvious when it's time to stop.
• 4:56
  SPEAKER_01: So I got distribution, you know, because I my father died when I was 12.
• 5:01
  SPEAKER_01: And I always feel like some of these things happened very serendipitously because, and there were always these sort of older men in business who were so kind and taught me so many things.
• 5:09
  SPEAKER_01: And my first distributor was Rishi Schwai, who was one of the first natural body care distributors in the country.
• 5:14
  SPEAKER_01: And he brought me in on a Saturday and walked me through his dark warehouse and told me how to measure margins and how to look at clean ingredients, and sat me in his office and talked about the displays I needed.
• 5:24
  SPEAKER_01: Like so many people patiently taught me.
• 5:26
  SPEAKER_01: And I think because I'm curious and I have tons of energy and I just I never stop.
• 5:31
  SPEAKER_01: It just I wasn't willing to give up.
• 5:33
  SPEAKER_01: And um, when I had my kids, so I so I did it on a whim and I grew it through the yellow pages and sort of all these natural things that unfolded.
• 5:42
  SPEAKER_01: And then um I moved to Maine and I think I had like a couple hundred stores.
• 5:46
  SPEAKER_01: I got my first space, I got 200 square feet in um this old building that had a theater downstairs, a state theater.
• 5:53
  SPEAKER_01: And I had 200 square feet that opened up into the awning, um, like the where it's you know, like it's lit up with whoever the act is.
• 6:00
  SPEAKER_01: And I would crawl out the window and I'd spray my displays.
• 6:02
  SPEAKER_01: People in traffic could see me in my overalls and like going in and out of the windows, and I'd ship out to stores.
• 6:07
  SPEAKER_01: And then um I learned QVC was coming to Maine, and there was like an open call.
• 6:11
  SPEAKER_01: So I had a little red wagon and I filled it with lip balm and I went to this open call and talked to the QVC people.
• 6:17
  SPEAKER_01: And the next week I got a purchase order for more than I'd sold the whole year.
• 6:21
  SPEAKER_01: So I get all excited and I called my mentor, this guy who was an incubator in Massachusetts for a year to learn business, which I probably should have mentioned.
• 6:28
  SPEAKER_01: But anyways, I called Joe and I said, You don't, I got this great PO.
• 6:31
  SPEAKER_01: This is so exciting.
• 6:32
  SPEAKER_01: I'm gonna be on TV.
• 6:33
  SPEAKER_01: And he's like, How much is it gonna cost you to make that?
• 6:35
  SPEAKER_01: And I said, Yeah, you're not listening.
• 6:36
  SPEAKER_01: I got this great PO.
• 6:37
  SPEAKER_01: He's like, You gotta do some math, figure it out and call me back.
• 6:40
  SPEAKER_01: So I call him back and I'm in tears.
• 6:42
  SPEAKER_01: I'm like, I don't have$6,000.
• 6:44
  SPEAKER_01: He's like, When you were in the incubator, we did your forecast, we did your business plan.
• 6:48
  SPEAKER_01: You have what you need.
• 6:49
  SPEAKER_01: Take your PO and your forecast and go to the bank and get your loan.
• 6:51
  SPEAKER_01: So I got a loan.
• 6:52
  SPEAKER_01: It was a guaranteed sale.
• 6:53
  SPEAKER_01: I had four minutes to sell all that product, and or I had to take it back.
• 6:58
  SPEAKER_01: I sold it all the next day.
• 6:59
  SPEAKER_01: They said it was great.
• 7:00
  SPEAKER_01: Do you want to come back?
• 7:00
  SPEAKER_01: So I started doing QEC, which was great.
• 7:02
  SPEAKER_01: And with the money from QEC, I played with what was the next natural product, which was a hand bomb.
• 7:07
  SPEAKER_01: And I started playing with shea butter because I didn't like how greasy hand bombs were.
• 7:10
  SPEAKER_01: They're always so sticky.
• 7:12
  SPEAKER_01: And I decided to call it Elephant Lube, and I bought 80 purple envelopes and I went to the bookstore and wrote down the names of all the beauty editors, and I mailed the envelopes with the sample of Elephant Lube to the, you know, the fancy beauty editors in New York.
• 7:23
  SPEAKER_01: And the first one that called was um Wendy from Vogue, and she left this message that I rewound a hundred times, like, there's no way this lady's from Vogue.
• 7:31
  SPEAKER_01: And it was Vogue and L and 17, modern by dozens and dozens.
• 7:35
  SPEAKER_01: It just went, we had no website, we didn't take credit cards, I didn't have any employee.
• 7:40
  SPEAKER_01: You know, I had, I think I had one part-time, very part-time employee, and it just exploded.
• 7:44
  SPEAKER_01: And so all of a sudden we went from being a natural food to QBC, and then it was gift stores were calling, sales reps were calling, this whole beauty, college, all these industries I didn't really know existed were, you know, how how do we order and what does this look like?
• 7:57
  SPEAKER_01: So it it just kind of exploded.
• 7:58
  SPEAKER_01: And that was 1998, which is coincidentally the same year I got married and I had my first kid in 2000.
• 8:03
  SPEAKER_01: So, you know, it's like anything, feast or famine.
• 8:06
  SPEAKER_01: And it was just this crazy, you know, that was the big growth when I felt like the world embraced mad gabs, the names, the, the quirkiness of the of the packaging.
• 8:14
  SPEAKER_01: You know, we stood out and we had a great story, you know, even though it was just the beginning.
• 8:18
  SPEAKER_01: Um, so that was really when it became something, right?
• 8:21
  SPEAKER_01: It became like this.
• 8:22
  SPEAKER_01: We were selling at Nordstrom, LL Bean, you know, QBC was there for a couple of years, and then all the Whole Foods.
• 8:28
  SPEAKER_01: I mean, it just our roster of of accounts has just been crazy over the years.
• 8:33
  SPEAKER_01: You would never expect something sort of so nichey to get the attention of such great retail partners.
• 8:39
  SPEAKER_01: And we've been lucky, you know.
• 8:40
  SPEAKER_01: And then when I had kids, it definitely was tricky, right?
• 8:43
  SPEAKER_01: It's hard to have, I was definitely gonna build my life around their needs because I was like, I have two boys four years apart, and I thought I don't get to do this over, and I know what kind of mother I want to be.
• 8:53
  SPEAKER_01: So I'm there coming first, and I missed a lot of things.
• 8:56
  SPEAKER_01: I said no to a lot of stuff because I was like, nope, I'm not gonna be gone for this long or do that.
• 9:00
  SPEAKER_01: I had limits of how long I would stay away.
• 9:02
  SPEAKER_01: And um, and it was tricky, you know, to to but I also knew that that's what mattered.
• 9:06
  SPEAKER_01: So I didn't mind going to bed and knowing that I missed an opportunity because I had these two awesome little boys who, you know, saw me there and I was there, and now they're grown and they remember me being home and with them all the time, which is that's very and they call all the time just to say hi.
• 9:20
  SPEAKER_01: So to me, that's like the win.
• 9:23
  SPEAKER_00: So Yeah.
• 9:25
  SPEAKER_00: Yeah, it's tough when you're building a business and you have a family if you don't have like that support network.
• 9:31
  SPEAKER_00: You know, it's uh it's a little bit difficult, you know.
• 9:35
  SPEAKER_01: Absolutely.
• 9:36
  SPEAKER_01: My mom was there.
• 9:36
  SPEAKER_01: My mom showed up when I trade shows.
• 9:38
  SPEAKER_01: I I'm actually almost done with the book, and I have an agent.
• 9:41
  SPEAKER_01: We're gonna go out on submission to publishers.
• 9:43
  SPEAKER_01: And I was writing the chapter of taking Silas, my first son, when he was, I don't know, five months old, getting to New York, getting to the cheapest hotel I could find that had enough beds for me, my mom, and one other employee to all sleep in the same room.
• 9:54
  SPEAKER_01: And we got there, and the room was trashed.
• 9:57
  SPEAKER_01: There were cigarettes put out in diapers.
• 9:59
  SPEAKER_01: I mean, I'd never seen anything like it.
• 10:00
  SPEAKER_01: And I was holding this baby and, you know, trying to get them to clean it up.
• 10:03
  SPEAKER_01: And I thought, what am I doing?
• 10:04
  SPEAKER_01: I'm crazy.
• 10:05
  SPEAKER_01: I'm at the Javid Center with him on my hip, selling lip balm.
• 10:08
  SPEAKER_01: My mom's there, you know, and even with support.
• 10:10
  SPEAKER_01: Um I still think it was crazy.
• 10:12
  SPEAKER_01: Um, you know, and then when my second son was born, I did the same thing and I drove all the way to New York with five people and had the babies with me.
• 10:18
  SPEAKER_01: And and but I wouldn't do it any other way.
• 10:20
  SPEAKER_01: I wasn't gonna leave them, you know.
• 10:21
  SPEAKER_01: I they were gonna come with me.
• 10:23
  SPEAKER_01: And one of my favorite stories was taking five staffers to new to New York.
• 10:27
  SPEAKER_01: Jasper's three months old, and we went down to Little Italy.
• 10:30
  SPEAKER_01: We eat dinner at the end.
• 10:31
  SPEAKER_01: I asked for the check and I give the guy my American Express card and he says, cash only.
• 10:35
  SPEAKER_01: I said, All right, I'll go.
• 10:36
  SPEAKER_01: Where's an ATM?
• 10:36
  SPEAKER_01: And he goes, You take that baby home and you mail me a check later.
• 10:39
  SPEAKER_01: And I was like, those are my people.
• 10:41
  SPEAKER_01: So he literally just sent us home that night, and I thought, New York gets such a bad rap, and I love it.
• 10:45
  SPEAKER_01: I feel like there's so many good, good people everywhere.
• 10:48
  SPEAKER_01: And I'm I'm partial to New York, so Yeah, yeah.
• 10:52
  SPEAKER_00: Yeah, it's rough, you know, especially when you're doing, you know, back then I was in the specialty food business uh and we used to do a lot of shows because e-commerce was just sort of beginning.
• 11:04
  SPEAKER_00: And um we actually put up the first meal site uh in 2000 uh called GreatMeals.com and uh it was the Wild West because it really um the the distribution supply chain to the consumer just wasn't built out the way it is today.
• 11:24
  SPEAKER_00: FedEx, UPS, they didn't know how to handle food products and you know the funny part about that was that we had stores, we had retail stores and we were we we had uh four stores that we built ourselves that had great top line sales, great bottom line.
• 11:43
  SPEAKER_00: And uh we put this website up which was losing money.
• 11:46
  SPEAKER_00: We did like a million the first year, but it was losing money and uh every month and I was getting frustrated with it.
• 11:52
  SPEAKER_00: I didn't see any end in sight.
• 11:54
  SPEAKER_00: But we had to we were looking to raise capital because we wanted to make an acquisition.
• 11:59
  SPEAKER_00: And uh we started talking to all these private equity guys and everybody wanted to talk about the website.
• 12:05
  SPEAKER_00: That's all they were interested in.
• 12:07
  SPEAKER_00: And I I said l the stores are what's generating the money.
• 12:11
  SPEAKER_00: I'm ready to shut this thing down.
• 12:13
  SPEAKER_00: No, no, no, it's the future, it's a future.
• 12:16
  SPEAKER_00: Like it may be the future in a lot of categories, but I'm not so sure it's the future of food right now.
• 12:20
  SPEAKER_00: Right.
• 12:20
  SPEAKER_00: Especially now perishable food.
• 12:22
  SPEAKER_00: And we got we wound up getting acquired by a supermarket chain that did see the value in that website and turn it into their home shopping platform.
• 12:30
  SPEAKER_00: So that was sort of what what saved that.
• 12:33
  SPEAKER_00: But yeah, it was a it was very difficult.
• 12:35
  SPEAKER_00: And we used to go to shows and I hated going to show I hated going to shows.
• 12:41
  SPEAKER_00: I just felt like it was useless.
• 12:43
  SPEAKER_00: And I felt like as a retailer, if there if there are products out there and those people were not calling us, then that was their problem.
• 12:54
  SPEAKER_00: Because I don't know how much you spend to go and uh I well actually I do know because we do have we have clients who go to these shows and they spend you know upwards of fifty thousand, sixty thousand dollars to go to a show.
• 13:07
  SPEAKER_00: But uh none of them have ever gotten a return, but yet they still go because it's well, we feel like we have to go.
• 13:13
  SPEAKER_00: For what?
• 13:14
  SPEAKER_00: For what?
• 13:15
  SPEAKER_00: Because you could take that money and you could put a salesperson out and for six months and get more business than you got at the show.
• 13:23
  SPEAKER_00: Absolutely.
• 13:24
  SPEAKER_00: So I'm not a big believer in the shows anymore.
• 13:26
  SPEAKER_01: I just think that's Yeah, it really some are worth it and some are not.
• 13:30
  SPEAKER_01: And I know in COVID when we stopped doing them and they were gone, I thought, well, this is much better.
• 13:35
  SPEAKER_01: This is much easier.
• 13:35
  SPEAKER_01: And I watched the bottom line change dramatically, the travel line, the trade show lines just gone, and all of it just goes to the bottom.
• 13:42
  SPEAKER_01: You know, it's definitely I've learned to be super selective, and I have a show in Vegas in a couple weeks, and um I'm sort of I'm I'm excited, but I'm dreading it too, and it has to pay for itself, you know, and it's it's a week out of the office, and you hope for, you know.
• 13:55
  SPEAKER_01: I mean, I met Wegmans at the Atlanta gift show years ago, and that was, you know, I was like, done.
• 14:00
  SPEAKER_01: You know, that one, but you you can't go to ten shows and hope for one key account.
• 14:04
  SPEAKER_01: You have to the math doesn't math, as the kids say.
• 14:07
  SPEAKER_00: So yeah, no, the math doesn't math.
• 14:09
  SPEAKER_00: And and you would you you probably would have wound up with with Weggy's if you went to Weggy's and just I try I had been trying so hard, I just needed the right person who was excited.
• 14:18
  SPEAKER_01: So yeah.
• 14:19
  SPEAKER_00: That's always the challenge, you know.
• 14:21
  SPEAKER_00: Yeah.
• 14:21
  SPEAKER_00: I I always tell we have a lot of clients who are omnichannels, so they want to be in retail as well as sell online.
• 14:28
  SPEAKER_00: And I'm always a big fan.
• 14:29
  SPEAKER_00: Like when we built Beauty, when we built Raw Beauty, we made such a splash on on HSN uh here, Canada, uh across the pond.
• 14:40
  SPEAKER_00: And then we were on Amazon, we had our own website, we made such a big splash that the retailers started coming to us, which I love because then it stops me, it it saves me from from having to pay slotting and rebates, discounts, cruels, all that garbage.
• 14:53
  SPEAKER_00: But you know, what I tell people, what I what I coach to to our brands that want to get into retail is hey man, you know, if you're gonna get a broker, you wanna you wanna talk to somebody who's who lets you know, because I've been on the retail side.
• 15:09
  SPEAKER_00: You want somebody, you want the broker who's in that office every day.
• 15:13
  SPEAKER_00: You want the broker that knows everybody but is in the office because they hear the scuttle butt.
• 15:18
  SPEAKER_00: And when they're the ones that are gonna be the most valuable.
• 15:21
  SPEAKER_00: Don't just get the guy that says, oh, we're a national broker, we're here, we're here, we're here.
• 15:25
  SPEAKER_00: Yeah.
• 15:25
  SPEAKER_00: Because those guys don't necessarily have the connections.
• 15:28
  SPEAKER_00: Being a broker, uh you it's all about it's all about the connections, and it's all about the respect they get when they're in that office.
• 15:34
  SPEAKER_00: Aaron Ross Powell Absolutely.
• 15:35
  SPEAKER_01: Or don't get, and then you want to make sure you get in with the ones that they don't run when they see them coming.
• 15:40
  SPEAKER_01: You want the ones that have that regular appointments that they know, they know when the sets are, they know when review dates are, and people are happy to give them the information.
• 15:47
  SPEAKER_01: But it's true, the right broker is key, absolutely.
• 15:50
  SPEAKER_00: Yeah.
• 15:51
  SPEAKER_00: We when I w when uh we got acquired by a supermarket chain, like I told you, and with the stores and the website, I had to go and work for that company for a period of time, and I was in charge of, you know, a division.
• 16:06
  SPEAKER_00: And uh there was one broker that was just always in the in the building, just always in the building.
• 16:12
  SPEAKER_00: He knew everybody, he would he was always in there talking to people, he'd bring certain people, you know, coffee and blah, blah, blah.
• 16:19
  SPEAKER_00: And he was in there, but he always had his ear.
• 16:23
  SPEAKER_00: So he'd be listening to what the buyers were talking about, he'd be listening to what the directors, the VPs were talking about, and then he'd always come back.
• 16:29
  SPEAKER_00: Hey, he'd say to me, you know, I I heard you guys were looking at new, you know, so-and-so.
• 16:34
  SPEAKER_00: I got this, I have this company.
• 16:36
  SPEAKER_00: And you're like, I want you to give them, you know, give him an hour.
• 16:38
  SPEAKER_00: And then you know, he's calling up the company, okay, can you get here by tomorrow so that he'll give you an hour?
• 16:44
  SPEAKER_00: And it, you know, he was the most effective, but he was a they were good, they knew what we needed, and they were they were almost partners with us in the business.
• 16:52
  SPEAKER_01: So, yeah.
• 16:53
  SPEAKER_00: Yeah.
• 16:54
  SPEAKER_00: And then there were crappy ones, but yeah, they're interesting.
• 16:58
  SPEAKER_01: You've been around this long, you've done you've seen all the versions, not all of them.
• 17:01
  SPEAKER_01: There's always more to see, but there's definitely the versions.
• 17:04
  SPEAKER_01: Yeah.
• 17:04
  SPEAKER_01: And it's a learning, it's been every different industry's been a different learning, you know.
• 17:08
  SPEAKER_01: And when you're selling a$2 product, you need to be as diversified as possible and have good strategy, which 35 years in, I feel like we're really getting we're nailing it now, but it's taken a long time, you know.
• 17:21
  SPEAKER_00: After 35 years, we finally found success.
• 17:24
  SPEAKER_01: Yeah, I mean, it's true.
• 17:25
  SPEAKER_01: And part of it's because I kept it small while my kids were growing and kept it alive, it but kept the roots intact and kept the vibe there.
• 17:31
  SPEAKER_01: And now you know, and I used to say when the kids were a little, like, I'm not borrowing money, I'm not taking investment, I want to, you know, know what I'm doing, know what it looks like, and know how it's gonna pay off, and I'll keep it at the size I can manage while the kids are growing.
• 17:44
  SPEAKER_01: And if there's anything left, I'll blow some, you know, some on the embers and see if they can turn into a fire.
• 17:49
  SPEAKER_01: And in the interim, the world falls in love with organics, Burt Spees does what Burt Spees does, paves the way for us to get into mass market because they've proven that concept.
• 17:58
  SPEAKER_01: So it was I'm very happy with what happened while I was, you know, raising my kids and to be able to have a chance now to um to hit it out of the park, don't mind if I do.
• 18:07
  SPEAKER_00: Yeah.
• 18:08
  SPEAKER_00: No, that's uh No, I mean it takes resilience, it takes to to stay in the game long enough to to find success.
• 18:16
  SPEAKER_00: I've seen a lot of uh founders walk away when they hit roadblocks and and throw their hands up and say, I can't do it anymore.
• 18:23
  SPEAKER_00: And and it's just you know, I coach a lot of businesses, a lot of founders.
• 18:29
  SPEAKER_00: And um which I actually love.
• 18:31
  SPEAKER_00: Uh it's uh it's a part of my my life that I I love the most.
• 18:34
  SPEAKER_00: But anyway, uh had this one guy who's he he was a developer, he was outside of a business and uh and his his father had a a business and uh his father died unexpectedly.
• 18:49
  SPEAKER_00: But his mom relied on that money coming from that business and he he had to leave his career and take it over.
• 18:56
  SPEAKER_00: And he was thrown into something that he had no concept of.
• 19:00
  SPEAKER_00: And it was it was primarily it was a service business, but also selling a product and it was it was uh uh retail.
• 19:08
  SPEAKER_00: And he was just he came to me because he was just frustrated and we you know, we got on a plan, I got him stabilized, and then he said, you know, I think the best thing for my mom and for me is is if I just find an acquirer because then at least she can get money and I can go back to my career.
• 19:24
  SPEAKER_00: Right.
• 19:25
  SPEAKER_00: And I said, you know, it sounds fine.
• 19:26
  SPEAKER_00: And he found one.
• 19:28
  SPEAKER_00: But once you that's not that's not the end.
• 19:31
  SPEAKER_00: That's just the beginning of the game.
• 19:33
  SPEAKER_00: Because now you've got to go through due diligence, you've got to go through the negotiation, you've got to go through the valuation process, and it could take months.
• 19:40
  SPEAKER_00: And he was at the point, he said to me, you know, I can't do it.
• 19:44
  SPEAKER_00: I just whatever they give me, whatever they offer me, I'm just I'm out.
• 19:48
  SPEAKER_00: He said, I just it's too much.
• 19:50
  SPEAKER_00: And I said, You can't.
• 19:51
  SPEAKER_00: I said, now is the time that you have to, I said, you're running a marathon.
• 19:56
  SPEAKER_00: I said, now is the time that you're at mile 16 and you have to get over the hump.
• 20:02
  SPEAKER_00: I said, so that right now your body is telling you stop, your mind is telling you stop.
• 20:06
  SPEAKER_00: So, but you have to just pull your boots up and go, I'm going.
• 20:10
  SPEAKER_00: And I said, because you have to think about your mom at the end, you have to think about yourself at the end.
• 20:14
  SPEAKER_00: I said, so whatever you have to do, I don't care if you have to get up tomorrow morning and start running or start going to the gym.
• 20:19
  SPEAKER_00: I said, you have to put your head space in a whole different world because you cannot stop.
• 20:24
  SPEAKER_00: I said, you have to see this through because if not, you're gonna leave money on the table and that's not fair to your mom.
• 20:29
  SPEAKER_00: Exactly.
• 20:30
  SPEAKER_00: You know, and and and he did, and he was successfully, you know, did to do what he did, you know.
• 20:35
  SPEAKER_01: Yeah, I thought I wasn't sure how you were gonna say that ended, but no, I'm glad and I'm glad it's good he had you because it is it is exhausting, and there's so many moments.
• 20:42
  SPEAKER_01: Whenever I talk to the kids at the school, say, Do you ever want to give up?
• 20:45
  SPEAKER_01: I'm like, sure, all the time, you know, and some days, some days more than others.
• 20:49
  SPEAKER_01: But I mean, we had a catastrophic flood in 2006 where there was a fire in this, I was had 5,000 square feet in the in this brick mill on a river in Maine, like picturesque, awesome space, did a whole build out.
• 21:01
  SPEAKER_01: Half was production, half was offices.
• 21:02
  SPEAKER_01: You could roller skate in the place.
• 21:03
  SPEAKER_01: It was just awesome.
• 21:05
  SPEAKER_01: But there was a wood shop above and there was a fire.
• 21:07
  SPEAKER_01: And when the fire got put out, it flooded us.
• 21:10
  SPEAKER_01: And so that would have been a perfect moment to just, you know, wash your hands and walk away, you know, having the kids and having a baby and then having like having a tin issue in Germany the day I gave birth for my first kid.
• 21:22
  SPEAKER_01: And I'm just like, I can't believe I'm having this conversation from the hospital.
• 21:25
  SPEAKER_01: Like, this is not okay.
• 21:27
  SPEAKER_01: You know, like there's so you know, yeah.
• 21:29
  SPEAKER_01: When I think about all the time, then I got divorced when I was 41.
• 21:32
  SPEAKER_01: So all of a sudden, okay, this has to support everybody.
• 21:35
  SPEAKER_01: Now you got to figure out how to take this$2 lip balm and make it support a whole second house, which is not an easy exercise.
• 21:41
  SPEAKER_01: Um, and yeah, it's scary.
• 21:44
  SPEAKER_01: I mean, that would have been a great time to quit and get a job, right?
• 21:46
  SPEAKER_01: Like there's so many moments that um I probably should have or could have.
• 21:51
  SPEAKER_01: But in the interim, like, look at what happens in the space.
• 21:54
  SPEAKER_01: Everybody starts a business.
• 21:55
  SPEAKER_01: The technology is what it is now, it's a very crowded space.
• 21:58
  SPEAKER_01: So when I talk to like A new retailer, and they'll say, You've been doing this for 35 years.
• 22:02
  SPEAKER_01: And I'm like, Yeah, that's longer than you've probably been alive, half of them, right?
• 22:06
  SPEAKER_01: And but then they say, Well, I know you're going to be here in two years.
• 22:09
  SPEAKER_01: Like the amount of brands they try that in a year or two realize it's hard to make money selling lip balm or whatever it is.
• 22:15
  SPEAKER_01: You know, so we become this sort of OG in the lip balm space, which I love.
• 22:18
  SPEAKER_01: And now we're getting more and more distribution and respect, and we're seeing, you know, the pieces unfold.
• 22:23
  SPEAKER_01: But dang, it's been a long road.
• 22:26
  SPEAKER_00: Yeah, but it's, you know, it's a, it's a, it's a good road and it's uh, you know, and it's a strong road, and now you're still there.
• 22:32
  SPEAKER_00: But you're 100% right.
• 22:34
  SPEAKER_00: The retailers, people don't realize they think they have a new product, they walk into a retailer and they think everybody's gonna fall over and say, oh, this is a great product.
• 22:42
  SPEAKER_00: You have to do your research.
• 22:44
  SPEAKER_00: You have to know what you're doing when you walk into retail.
• 22:46
  SPEAKER_00: And I tell this to people, again, all the time, to founders.
• 22:50
  SPEAKER_00: If you're going in there, you know, and trying to unseat an incumbent in a space, if there's you you've got a pasta sauce and you walk into a supermarket and they've got pasta sauce, what makes your pasta sauce different?
• 23:03
  SPEAKER_00: If if there's nothing really different about it, then you're on you're trying to unseat an incumbent, and that buyer is gonna say, well, I'm gonna protect my margin.
• 23:12
  SPEAKER_00: I'm not taking a risk on you.
• 23:13
  SPEAKER_00: You have a new product.
• 23:14
  SPEAKER_00: I don't know if you're gonna be around in a year, so you're gonna cover that margin.
• 23:18
  SPEAKER_00: It may be a it may be a guaranteed sale.
• 23:21
  SPEAKER_00: It may be, you know, rebates, discounts, accruals, slotting.
• 23:24
  SPEAKER_00: It may be a lot of things, a lot of different things.
• 23:26
  SPEAKER_00: I don't know if you're gonna be here in a year.
• 23:29
  SPEAKER_00: So there's a lot that goes into being successful at retail.
• 23:33
  SPEAKER_00: So you have to really focus and you have to think and you have to have a plan.
• 23:36
  SPEAKER_00: You don't everybody thinks you just walk into retail and they're waiting for new products.
• 23:40
  SPEAKER_00: Yeah.
• 23:41
  SPEAKER_00: They've got tens of thousands of SKUs in those stores.
• 23:44
  SPEAKER_00: They're not waiting for you.
• 23:45
  SPEAKER_01: No, and they have every store has a different rule of uh rule game, a rule book of what you have to figure out.
• 23:51
  SPEAKER_01: You know, when's the review?
• 23:52
  SPEAKER_01: Is there slotting?
• 23:53
  SPEAKER_01: How many, how much promotion and support do you have to give them?
• 23:55
  SPEAKER_01: What's the extra strategy?
• 23:56
  SPEAKER_01: You know, are they in and out?
• 23:57
  SPEAKER_01: So, you know, is it every day?
• 23:59
  SPEAKER_01: Yeah.
• 24:00
  SPEAKER_01: All the things.
• 24:01
  SPEAKER_01: So everyone is its own set of rules.
• 24:03
  SPEAKER_01: And um, I started working with a brand builder consultant a couple years ago, and she's been incredible at managing all of that.
• 24:10
  SPEAKER_01: And she is just like the memory steel trap.
• 24:13
  SPEAKER_01: She knows this is how this one works, this one works, and she keeps an eye on all those pieces.
• 24:16
  SPEAKER_01: And that's been a huge key to the success we're having now is having one person that is focused on those industries and those games and the reviews, and then brings me in where we need to.
• 24:26
  SPEAKER_01: But you need somebody who understands how the brokers work, how the buyers work.
• 24:30
  SPEAKER_01: And then for us in the stores, too, like we're sitting in these sets next to Burt Spee's, Karmex, Blistex, Chapstick, EOS.
• 24:36
  SPEAKER_01: We're the tiniest company in the space behind these billion-dollar brands that have these huge, you know, owners.
• 24:42
  SPEAKER_01: And we're trying to, we can't outsell them.
• 24:44
  SPEAKER_01: We don't have no one knows us.
• 24:45
  SPEAKER_01: So we're there and we have the space.
• 24:47
  SPEAKER_01: And our biggest challenge is how do we get the velocity we need?
• 24:51
  SPEAKER_01: How do we make help people?
• 24:52
  SPEAKER_01: How do we tell the story better?
• 24:53
  SPEAKER_01: How do we communicate why moose mooch with three ingredients is better than, you know, this, this, this, or this, you know, and why it might work better for your kid if it's unscented, it's great for sensitive skin, whatever the angle is.
• 25:04
  SPEAKER_01: We have to do that with a budget that's a teeny tiny fraction of these huge companies that we share space with.
• 25:09
  SPEAKER_01: And most of our buyers know we're small and we don't have the same investment power to create the brand awareness that we need.
• 25:16
  SPEAKER_01: But that's the challenge of this space is yes, we're going, we're getting the placement, but now we need the brand awareness to bring the consumer to us and say, ah, I'm picking mad gabs instead of birds or instead of chapstick or whatever.
• 25:27
  SPEAKER_01: And that's that's a that's a tall order.
• 25:29
  SPEAKER_00: Yeah, I think in that particular uh that particular challenge, in my opinion, social media and the ability to create content and put it out there to build awareness is better than it's ever been before.
• 25:44
  SPEAKER_00: Certainly there's a lot of crap out there on social media, but uh I do think that it gives you an opportunity if you're creative with with what you're doing, I think it it it has the ability for free to sell.
• 25:59
  SPEAKER_00: You know, the hard part is creating the videos.
• 26:01
  SPEAKER_00: That's the hard part.
• 26:02
  SPEAKER_00: Creating the videos and the content.
• 26:03
  SPEAKER_00: But the uh the the ability to get that message out uh using social media, I think, plays really well.
• 26:10
  SPEAKER_00: It definitely does.
• 26:11
  SPEAKER_00: Yeah.
• 26:11
  SPEAKER_00: And it and it really f falls into your QVC background because I was just thinking that as you said that.
• 26:16
  SPEAKER_01: Yeah, and I love I'm a ham.
• 26:17
  SPEAKER_01: I'm I I don't always take the time to film the content, but when I do, my marketing gal will say, like, yes, people are happy when it's your face and your story, they really respond to that.
• 26:26
  SPEAKER_01: So I just I'm sick of myself, but I know most people aren't sick of me the same way I'm sick of me.
• 26:31
  SPEAKER_00: Aaron Powell No, this generation, this this this up-and-coming generation wants authenticity.
• 26:36
  SPEAKER_00: They want the they want to know who the founder is and what the founder believes.
• 26:40
  SPEAKER_00: So the more you can do online, I think the better off you are.
• 26:43
  SPEAKER_00: So yeah, that's the right thing to do.
• 26:45
  SPEAKER_00: Um, all right.
• 26:46
  SPEAKER_00: Well, we're we're just about out of time.
• 26:48
  SPEAKER_00: Any anything you want to close with?
• 26:49
  SPEAKER_00: How can people find you?
• 26:50
  SPEAKER_00: Can people buy online?
• 26:52
  SPEAKER_00: Where would they go?
• 26:53
  SPEAKER_01: Madgabs.com is our direct website.
• 26:55
  SPEAKER_01: We are also some of our products are available on Amazon.
• 26:58
  SPEAKER_01: If you're um in stores, I mean Wegmans, Stop and Shop, Market Basket, Big Y, depending on where you are, giant food.
• 27:05
  SPEAKER_01: Whole Foods has us seasonally, and we're about to go into Publix in October.
• 27:08
  SPEAKER_01: So those are our retailers and always buying us at the stores helps us a lot.
• 27:12
  SPEAKER_01: And um, yeah, and following us on Instagram and follow me on Substack, all the places, and you know, tell all your friends and buy them as gifts and stick them in all your kids' backpacks.
• 27:21
  SPEAKER_01: There we go.
• 27:23
  SPEAKER_00: There you go.
• 27:24
  SPEAKER_00: All right.
• 27:24
  SPEAKER_00: Well, thank you for taking the time to come on and share with us.
• 27:27
  SPEAKER_00: I appreciate it.
• 27:28
  SPEAKER_01: Thanks for having me.
• 27:29
  SPEAKER_01: It was a lot of fun.
• 27:30
  SPEAKER_00: Yeah, my pleasure.
• 27:31
  SPEAKER_00: And uh, we will see you guys next time.