Advice Line with Isaac Larian of MGA Entertainment

Summary

How I Built This with Guy Raz – Episode Summary: Advice Line with Isaac Larian of MGA Entertainment

Release Date: July 31, 2025

In this engaging episode of How I Built This with Guy Raz, host Guy Raz sits down with Isaac Larian, the dynamic founder and CEO of MGA Entertainment—the powerhouse behind iconic brands like Bratz Dolls and L.O.L. Surprise. This episode delves deep into the challenges and triumphs of building a globally recognized toy company, while also providing invaluable advice to budding entrepreneurs through the Advice Line segment.

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Segment 1: Navigating Tariffs and Trade Policies

[04:09]
Guy Raz opens the conversation by addressing a pressing issue for MGA Entertainment: tariffs. With a significant portion of MGA’s production being imported, tariffs directly impact the company's bottom line and the broader toy industry.

Isaac Larian:
"Tariffs are basically tax in the toy industry. It's tax on children. And these tariffs are not going to be paid by the toy companies or any company. They're not going to be paid by retailers. They're going to be paid by the consumers." [04:38]

Larian emphasizes the complexity of global supply chains, highlighting that components for products like Bratz Dolls are sourced internationally, making tariffs a consumer-burdened issue rather than one absorbed by businesses or retailers.

Segment 2: The Art of Creating Viral Products

Transitioning from macroeconomic challenges, the conversation shifts to product innovation and marketing strategies—crucial elements in MGA’s success story.

Isaac Larian:
"I think innovation is the mother of all successes. And you know, first of all, I want to take a step back in order for it to be successful. As an entrepreneur, you must embrace failure. For every success that we have had, we have had 10 failures." [06:25]

Larian underscores the importance of resilience and adaptability in entrepreneurship. He shares how MGA navigated the evolving landscape of marketing platforms—from Nickelodeon to YouTube and now TikTok—demonstrating the need to stay attuned to changing consumer behaviors.

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Segment 3: Advice Line – Helping Fellow Entrepreneurs

The heart of the episode lies in the Advice Line segment, where listeners call in with their entrepreneurial dilemmas. This episode features two insightful callers: Libby Mochan of T is for Taught and Robin Hall of Town Hall Outdoor Co.

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Caller 1: Libby Mochan of T is for Taught

[07:33] Libby Mochan:
"Hi Isaac. My company is T is for Taught, and we create learn and play kits for kids ages 3 to 6. We ship these educational kits all over the country."

Libby's Challenge:
Seeking strategies to enhance PR and brand visibility without the hefty investment of a full-service PR agency. Despite efforts in DIY outreach and influencer gifting, traction remained limited.

Advice from Isaac and Megan:

• Targeting the Right Audience:
  Megan:
  "I think I would change and market to grandparents. Once you start marketing to grandparents because they want to take care of their grandchildren and they have a lot more disposable income." [13:36]

• Content Strategy:
  Megan:
  "Shoot videos where kids are just playing with your product and then edit that and put that out. That's how it becomes viral." [15:28]

• Business Sustainability:
  Libby:
  "We are cash flow positive. We've grown 250% from '23 to '24 and are on track for seven figures next year." [10:30]

Libby implemented the advice by shifting her marketing focus towards grandparents and leveraging authentic testimonials from parents, leading to improved brand visibility and engagement.

---

Caller 2: Robin Hall of Town Hall Outdoor Co.

[32:50] Robin Hall:
"We design durable, purpose-built outdoor apparel for adventurous kids using sustainable materials."

Robin's Challenge:
Rapid growth has led to resource strain and cash flow issues. With plans to expand into new product lines, Robin is contemplating the best strategies to sustain growth amidst macroeconomic uncertainties and tariff impacts.

Advice from Isaac and Megan:

• Rebranding for Market Resonance:
  Megan:
  "Change the name because names matter. It could be a division of Town Hall, but change the name because that name doesn't resonate with the product." [35:31]

• Strategic Partnerships:
  Isaac:
  "Look for investors who have CPG experience and connections at major retailers like Target and Walmart." [27:55]

• Authentic Marketing:
  Megan:
  "Use authentic testimonials and encourage parents to share their positive experiences on social media." [29:42]

Robin took the advice to heart by considering a rebranding strategy and focusing on authentic customer testimonials, which helped in refining their market approach and enhancing brand loyalty.

---

Segment 4: Personal Insights and Closing Thoughts

In the episode's closing, Isaac shares personal reflections on entrepreneurship, emphasizing the value of problem-solving skills honed through various experiences.

Isaac Larian:
"Engineering teaches you how to solve problems. When you run a business, you have to solve problems on a daily basis. So it's like a brain muscle. So I would not change anything." [46:48]

Additionally, Isaac highlights the importance of resilience and honesty in business dealings, drawing inspiration from figures like Simon Cowell to advocate for authentic and straightforward communication.

---

Key Takeaways:

1. Embrace Failure: Success often stems from multiple failures. Resilience is key.
2. Stay Adaptive: Marketing strategies must evolve with changing platforms and consumer behaviors.
3. Target the Right Audience: Understanding and reaching the core demographic, such as grandparents for educational products, can significantly boost brand visibility.
4. Authentic Storytelling: Genuine testimonials and relatable content can drive engagement and trust.
5. Strategic Growth: Balancing growth with resource management is crucial, especially amidst economic uncertainties.

This episode not only sheds light on the intricate workings of MGA Entertainment but also offers practical advice for entrepreneurs navigating the competitive landscape. Whether you're grappling with marketing challenges or scaling your business, the insights shared by Isaac Larian and Megan provide a roadmap for sustainable success.

---

Notable Quotes:

• Isaac Larian on Tariffs:
  "Tariffs are essentially a tax on children. They're not going to be paid by the companies or retailers; they're going to be paid by the consumers." [04:38]

• Megan on Embracing Failure:
  "You have to embrace failure. For every success that we have had, we have had 10 failures." [06:25]

• Megan on Marketing to Grandparents:
  "Marketing to grandparents is effective because they have more disposable income and are willing to invest in their grandchildren's education." [13:36]

• Isaac Larian on Strategic Partnerships:
  "Look for investors who not only provide capital but also bring valuable industry experience and retail connections." [27:55]

---

By intertwining personal anecdotes with actionable business strategies, this episode serves as a masterclass in entrepreneurship, offering listeners both inspiration and practical tools to build and sustain their own ventures.

Transcript

[Guy Raz]

Wondery subscribers can listen to How I Built this early and ad free right now. Join Wondery in the Wondery app or on Apple Podcasts. I recently stayed at an incredible Airbnb in Palm Springs and I thought to myself, wow, I could live at this place. Have you ever been enjoying your stay at an Airbnb when you suddenly ask yourself, wait a minute, could I do this too?

[Isaac Larian]

Find out how much your place is.

[Guy Raz]

[e-mail] airport host if you've started your own business, you know just how many challenges there are, big and small. I mean, look at how I built this building. This show came with a lot of trials, late nights, very, very early mornings. But even though there were challenges getting started, there is something that makes setting up a new business easier. Getting connected with AT&T business it doesn't matter what your business is dealing with, AT&T business helps to make it much, much easier. And that's the point of a provider in the first place. Making building your dream easier. Wake up to the power of ATT [e-mail] that's business.att.com if you're running a small business, you know there's nothing small about it. Running a new business is all consuming and every day there are new decisions, new problems to solve, and new challenges to face. But knowing you have the right tools can give you a ton of comfort. And that's why I really like Shopify. Shopify's point of Sale system is a unified command center for your retail business. It brings together in store and online operations across up to 1000 locations. Get all the big stuff for your small business right with Shopify. Sign up for your $1 per trial and start selling today at shopify.combilt go to shopify.com built shopify.combilt hello and welcome to the advice line on How I built this Lab.

[Isaac Larian]

I'm Guy Raz. This is the place where we help.

[Guy Raz]

Try to solve your business challenges.

[Isaac Larian]

Each week I'm joined by a legendary founder, a former guest on the show.

[Guy Raz]

Who will help me try to help you.

[Isaac Larian]

And if you're building something and you.

[Guy Raz]

Need advice, give us a call and you just might be the next guest on the show.

[Isaac Larian]

Our number is 1-800-433-1298. Send us a 1 minute message that tells us about your business and the issues or questions that you'd like help with. You can also send us a voice [e-mail] and make sure to tell us how to reach you. And also, don't forget to sign up for my newsletter. It's full of insights and ideas from the world's greatest entrepreneurs. You can sign up for [e-mail] and.

[Guy Raz]

We'Ll put all this info in the podcast description.

[Isaac Larian]

All right, let's get to it. Joining me today is Isaac Larian, founder and CEO of MGA Entertainment, the toy company behind Bratz Dolls and lol. Surprise. Isaac, welcome back to the show.

[Megan]

Thank you, Guy. Thanks for having me again.

[Isaac Larian]

It's great to have you back on. So we first had you on in, and you told us the amazing story about how you moved from Iran to the US when you were just 17 years old. You had a couple hundred bucks, you spoke almost no English, and then you would go on to build one of the largest privately owned toy companies in the world. It is an amazing story, and if you guys haven't heard this one, you've got to check it out. We'll put a link to it in the podcast description. Before we bring on our callers today, I want to ask you a couple questions. And first and foremost, I want to talk to you about something that I know is top of mind for you because you've been all over the media talking about it, and that's tariffs. Obviously, a lot of what you do is imported. You make dolls, toys for kids, and this is your business.

[Megan]

Yes, Guy, tariffs are basically tax in the toy industry. It's tax on children. And these tariffs are not going to be paid by the toy companies or any company. They're not going to be paid by retailers. They're going to be paid by the consumers. MGA owns the largest toy factory in America in Hudson, Ohio. We employ 700 workers.

[Isaac Larian]

Wow.

[Megan]

And you cannot make everything in America.

[Guy Raz]

Right.

[Isaac Larian]

You've got to import components and parts, right? Yeah, right.

[Megan]

Yeah, exactly. And Milton Friedman said this 40, 50 years ago. He used the pencil as an example where the wood is made in America, the lead is made in South Africa, the eraser is made somewhere else. So that's the way it is.

[Isaac Larian]

Yeah. And so. So it sounds like what you're saying, Isaac, is that in principle, you're not opposed to targeted tariffs, let's say, on steel or, you know, or energy or other things. But it's. It's on consumer products, toys, where obviously you have an interest in it. It's really hurting your business and hurting the industry.

[Megan]

Yeah, it is. And I think there has to be a moderation.

[Isaac Larian]

Yeah. All right, well, let's turn to some other issues now. Because I know that you have had some major viral hit toys, right? Beyond Bratz. Yes. Lol. Surprise. For example, I'm sure a lot of our callers today are going to be curious to know if there's any secrets or insights that you can share. Like how do you get a product to go viral? Is there a formula that you have? How do you make a product really break out into the mainstream?

[Megan]

Yeah, that's a great question. I think innovation is the mother of all successes. And you know, first of all, I want to take a step back in order for it to be successful. As an entrepreneur you must embrace failure. And for every success that we have had, we have had 10 failures.

[Isaac Larian]

I love that.

[Megan]

So you have to embrace failure. So the first thing is to have that mindset. I'm going to try, I'm going to fail and I'm going to try again. I'm going to fail, I'm going to try again. Until one hit, the chances are it will hit. We have a record of that. Once you have a great product, then you have great marketing teams who market the product. And marketing in toys changes every day. I mean there was a time when we put Bratz on Nickelodeon and that's how it became successful.

[Isaac Larian]

Yes, I remember that story you told me. Yeah, yeah.

[Megan]

And today no more Nickelodeon. It's on. It was YouTube. Now YouTube has gone to TikTok. God knows what's going to come next. So you got to be on the lookout for it all the time and change be a chameleon.

[Isaac Larian]

All right, Isaac, you ready for our first caller?

[Megan]

Yes.

[Isaac Larian]

All right, let's bring him on. Welcome to the advice line. You're on with Isaac Larian, founder of MGA Entertainment. Please tell us your name, where you're calling from and just one line about your business, please.

[Libby Mochan]

Hi Guy. Hi Isaac. My name is Megan and I'm calling from Hendersonville, Tennessee. My company is T is for Taught and we create learn and play kits for kids ages 3 to 6. We ship these educational kits all over the country and our kits are designed to support early learning through play based hands on activities.

[Isaac Larian]

Welcome to the show, Megan. Thanks for calling. So T is for To. So these are. This is a subscription box basically for three to six year olds.

[Libby Mochan]

Yes, it is.

[Isaac Larian]

And what they're thematic. They're based around like different themes. Each month they get a box.

[Libby Mochan]

Exactly. Yeah. So every single month there's a new educational theme. There's about 12 activities in every single kit. So for instance for June's kit we have ice cream Scientist and the kids actually get to become an ice cream scientist. There's math, there's fine motor skills, a lot of play based education. 90% of a child's brain is developed by the age of five. So we want to make learning fun and we want to give them a strong foundation before they start kindergarten.

[Isaac Larian]

When did you found the business?

[Libby Mochan]

It was actually back in 2020, the day before I had my second son.

[Isaac Larian]

And tell me the inspiration, the idea behind it. Why did you want to do this business?

[Libby Mochan]

Yeah, so I, prior to being a stay at home mom, I was a teacher, a kindergarten teacher in Nashville, Tennessee for close to a decade. And when 2020 came, I decided this was a great time for me to stay home with my two boys. And I wanted to start a business that was always in the back of my mind. And by the time my kids started school, I wanted this to be a full fledged business. So that's where we're at now. My second son is about to start kindergarten.

[Isaac Larian]

Wow. Okay, awesome. And what's your question for us?

[Libby Mochan]

Yeah, so with TS retaught, we built something that parents and kids really love. But how do I break through the noise and get real traction with PR brand visibility without having to hire a full service PR agency? I've tried some DIY outreach and influencer gifting with very limited success. So I'm looking for an effective budget friendly approach.

[Isaac Larian]

All right, still lots of questions for you, Megan. I want to bring in Isaac, Larry and Isaac before we answer Megan's questions. Any questions for her?

[Megan]

No. That's a great niche, Megan. And if you tweak it and do it right, I think it would become a major, major success. I have five grandchildren and my daughter in law and everybody's talking about having toys that bring learning, safe learning to their kids before they go to kindergarten. So it's a great niche.

[Libby Mochan]

Thank you.

[Isaac Larian]

Megan. Out of curiosity, I mean it's a, as you say, it's, you know, you are small, you don't have a huge marketing budget. How are you doing? I mean is the business sustainable yet? Are you profitable? Are you, is it, you know, overall, how are things doing?

[Libby Mochan]

So we are cash flow positive. Everything is being, we don't have any investors or anything. We've grown 250% from 23 to 24 and we're well into the six figures on track for next year to do seven figures.

[Guy Raz]

Wow.

[Isaac Larian]

So you're, that's great. Well, congrats on that. So your issue is how do you get more visibility? And I would say I Mean, let's just. We're talking to Isaac, who's a toy expert. I also have a line of toys with my. I do a kids podcast called wow in the World. And we, we sell our toys or science kits, basically. So, Isaac, we're not competing against you. We're selling like, like volcanoes kits and stuff.

[Megan]

Competition is good. Competition is good.

[Isaac Larian]

We're going after you, Isaac. No, we sell them at, you know, through Amazon and at Target and Walmart. And so it's tough, right? It's really tough to break. I mean, Isaac mentioned this I think is really critical is you've got to have like several failures before you get a hit. And so, you know, there's a challenge. How do you get. How do you get people to not only become aware of it, but interested in it? I wonder, what kind of things have you done that so far that you've tried that don't seem to have worked?

[Libby Mochan]

So what has worked has been meta ads. And I honestly, I've tried to do some gifting on influencers. Honestly, there's been like, no traction with that one. The only thing that's really working is just meta ads. So that's about all we've been able to accomplish. I've reached out, I've done a lot of PR as far as, like, there's been, you know, a lot of emails sent, but not much has I've gotten from it.

[Isaac Larian]

Isaac, let's say you're doing 7, $800,000 in sales a year. How much of that would you. And that's not your profit, right? That's your sales. How much of that would you devote to marketing?

[Megan]

Yeah, it's a great question. So before I answer that, I need to know what kind of margins you're making because you. To have enough money for marketing, if you sell something too cheap, then you have no marketing and it's a vicious cycle. So is it 60, 70%? What's your gross margin?

[Libby Mochan]

We are making about 40% off of every kit at the moment, and that's including CAC and some other stuff as well. Customer acquisition.

[Megan]

Okay, and what price are you selling them at?

[Libby Mochan]

They start at 38.95 and they go to 42.95. And then the individual kits are $48.

[Megan]

Okay, my first advice for you is raise prices. There is no difference between 38 and 49, so trust me, nothing will change. Actually, sometimes psychologically, when you sell something a little bit more expensive, you sell more of them because people think, oh, that's a great thing. That will give you more marketing muscle. And then I am not a fan of PR agencies. You got to do it on your own. You got to think outside the box. I would. Meta is fine, but you got to go to TikTok for your product. The. The core customer. Who do you think is your core customer?

[Libby Mochan]

Moms. Yeah.

[Megan]

I disagree. You see, it's not. Is the grandparents is the gift givers. So you need to start marketing to grandparents. Once you start marketing to grandparents because they want to. They want to take care of their gift givers, they want to take care of their children or grandchildren and they have a lot more disposable income. So I think I would change and market to grandparents and you can look them up and see there are different group grandparents groups out there and you should start marketing to them. As far as influencers are concerned, they get overwhelmed with everything and they like free things and they get them and they don't do much with it. So it has to be really viral. I mean, somebody has to buy. Actually not a famous parent should buy one of your products and they talk about it on social media. Once they do that, you get a big break.

[Isaac Larian]

I love that idea because it really does kind of force you. I think, Megan, to think more deeply about pushing this towards that specific audience. I mean, it's worth trying out, you know, your own sort of videos where it's specifically designed for grandparents. Just try that. I mean, in addition to, you know, videos for moms. Because you are thinking about people like you buying it. Right? Which we all do. We all, we're all like, oh, people like me are going to buy this. But actually, I think Isaac's onto something. I think that's exactly right, Isaac. It's that it's grandparents sending this to their grandkids as a subscription, knowing that, you know, they're going to help make their grandkids smarter.

[Megan]

Yes, exactly.

[Libby Mochan]

That's great advice.

[Megan]

And Megan, when you do the videos, you got to think outside the box. I mean, the biggest happiness for anyone, you have two kids, you see it is a laughter of a child. Nothing replaces that. So you gotta shoot videos where kids are just on their own playing with your product and then edit that and put that down. That's how it becomes viral.

[Libby Mochan]

Okay, that's awesome advice. Thank you so much.

[Isaac Larian]

Yeah, I love it. The brand is called T is for Todd. Megan Foster, thank you for calling in. Good luck.

[Libby Mochan]

Thank you. I'm a huge fan. Thank you so much. I really appreciate it.

[Isaac Larian]

Thank you.

[Megan]

Thank you.

[Libby Mochan]

Thanks.

[Megan]

Good luck. Thank you.

[Libby Mochan]

Thank you.

[Isaac Larian]

Isaac, how much. How much of your disposable income do you spend on your grandkids?

[Megan]

Oh God, if I could, and my kids will let me, I will spend all of it on them. Because they are. You know, I say grandkids are much better than children. I joke. And I say God gives the grandkids as a reward for not killing your children when they were growing up.

[Robin Hall]

Hahaha.

[Guy Raz]

We're gonna take a quick break, but.

[Isaac Larian]

When we come back, another caller, another question, and another round of advice. I'm Guy Raz. Stick around. You're listening to the advice line on how I built this lab.

[Guy Raz]

I just got back from a trip to Germany and I stayed at an awesome apartment right in the heart of Munich, right on the Marienplatz. And it was like one of the.

[Isaac Larian]

Coolest places I had ever, ever stayed.

[Guy Raz]

At where I could cook and enjoy the city and hear it and feel it and just walk right out into the main square. Right there was a beautiful place. And to be honest, I really didn't want to leave the next time you're away from your own home, consider hosting your space on Airbnb. Hosting on Airbnb provides you with an extra income stream, plus your earnings could even help offset the cost of your next trip. Your home might be worth more than you think. Find out how [e-mail] host it's an interesting time for business.

[Isaac Larian]

Tariff and trade policies are dynamic, supply.

[Guy Raz]

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[Isaac Larian]

Welcome back to the advice line on how I built this lab. I'm Guy Raz and my guest today is Isaac Larian, founder and CEO of the toy company MGA Entertainment. We are taking your calls and let's bring in our next caller.

[Guy Raz]

Hello.

[Robin Hall]

Hi, Guy and Isaac. My name is Libby Mochan and I'm calling in from New York City. I am the co founder of Fulton. Fulton is a modern brand of arch support. We offer comfortable, supportive and sustainable insoles that mold to your arch to provide customized support and relieve pain at a fraction of the price of custom orthotics.

[Isaac Larian]

Cool. So these are insoles that are designed to relieve to help with arch support, which I love because I wear Birkenstock shoes. I wear Birkenstock slippers. I'm wearing Birkenstock slippers right now because of the arch support. That cork that you get with the Birkenstocks. I'm a big fan of arch support.

[Robin Hall]

Yeah, these are also made of cork.

[Isaac Larian]

Cool. A lot of people have collapsed arches. And so tell me how you came up with this idea because it seems like a category ripe for disruption.

[Robin Hall]

Yeah, that's exactly right. I mean, I was experiencing back pain. I was treating it very reactively, doing things like taking painkillers and getting massages. And then I went to a chiropractor and he explained to me that those shoes don't have proper arch support and that causes misalignment and pain throughout your body, not just in your feet, but also in your knees, your hips and your back. But the custom orthotics that he was offering were $500. And at the time my health insurance didn't cover it and it just felt like a very high price point to pay for what to me was just an achy back. So instead I went to the drugstore and I found myself looking at this wall of brands of Instagram, the Dr.

[Isaac Larian]

Scholl's and the Super Souls and yeah, whatever they're called. Super speed or whatever.

[Robin Hall]

Yeah, very confusing. All these words I didn't know. And also materials that were more like gels and foams that didn't really provide support, more just cushioning. I thought there must be something else out there. And yeah, there wasn't. So decided to build it.

[Isaac Larian]

Wow, that's awesome. And. And so these are made out of cork. Now your insoles, they're hard, they're not like gel.

[Robin Hall]

Yeah. The base of them is cork, which is a great material. It molds to your feet as you walk, similar to Birkenstocks. And it's incredibly sustainable. It's actually the bark of a tree and then we line it with a layer of natural foam and then on top is a layer of vegan leather that's made of cactus. So totally sustainable. They're actually carbon negative to manufacture and they have a sort of a combination of comfort and support with the cork and the foam.

[Isaac Larian]

Tell me, tell us a little bit about how the business is doing so far. You launched in 2021, you said?

[Robin Hall]

Yeah, we launched in 2021. Last year we did high seven figures and we've been growing really quickly. It's been a great process. I've been working on it full time and I have been working on it full time since we launched. But yeah, with this growth comes some growing pains.

[Isaac Larian]

Yes. All right, so what's your question for us today?

[Robin Hall]

Yeah, so Fulton has grown very quickly over the last few years, but we're now feeling the effects of this growth on our resources and on our cash flow. Given the current macro instability, the tariff and also our lack of resources, how should we think about growth moving forward?

[Isaac Larian]

All right, Isaac Larian in Souls. Cool, Cool category. Lots of growth. But now there's growing pains.

[Megan]

Right. Are you making your product in usa? Where are you making them?

[Robin Hall]

They're manufactured in Portugal. That's where most of the world's cork is harvested.

[Megan]

Oh, good. So you only pay 10% duty?

[Robin Hall]

For now.

[F]

Yeah.

[Megan]

Don't say it too loud. I don't think he will change that.

[Robin Hall]

Fingers crossed.

[Megan]

Yeah. So that's the good news. And how much money you think you're going to need to grow your business?

[Robin Hall]

Well, I think that's a good question. It depends on how quickly we decide to grow. If we sort of want to stay in like single digits or low double digits growth, we could probably grow without like raising any capital. But if we wanted to grow significantly, I think that would require more capital. We are planning on launching into a new category which is like slippers for at home. So we are considering either doing like a pre order to help with cash flow or alternatively could try and raise capital. But honestly that's something that we, we want to avoid.

[Isaac Larian]

So you've not raised anything yet? It's been entirely self funded?

[Robin Hall]

No, no, we did a small like angel and friends and family. Round right when we first launched but have not raised since. We are not venture backed.

[Megan]

How big is this market?

[Robin Hall]

I think it's about 1.5 billion. So we have less than 1% of it. So there's definitely a lot of opportunity, we believe.

[Megan]

Yeah. So I am against giving a portion of my company to stranger unless it's absolutely needed. That partner should bring something to the table and that is not just the money. Maybe they have operation experience, maybe they have distribution at retail experience. And it's tough market now, but there are people who are lending or investing. If you have a great business plan, I would do a great business plan. I will show that this an industry that's $1.5 billion. I've been growing double digit for the past few years and that's where the sky is. And then look for investors. You should have that in order to do this. But again, I would hire what I call or partner with somebody who can bring something else to the market. I mean, do you want to sell this to mass retailers?

[Robin Hall]

I think potentially. I mean, so far we've been focused really on our direct to consumer channel because that's, you know, what we know best and has been growing so quickly. But I definitely see an opportunity to get into Target and differentiate because that's the first place that I went when I was looking for insoles.

[Isaac Larian]

Yeah, yeah.

[Megan]

And Target is best for it. But if you're going to invest with somebody, find somebody who can get you into Target. Somebody who has experience to do that. Because they have 2,000 stores and all of a sudden you put two feet, the one feed section. It eclipses direct to marketing. But you have to have a niche in your packaging and your product to not get lost in the clutter of other products.

[Isaac Larian]

Yeah. You know, Isaac, while we've been talking, I've been looking at your site. Libby and I went ahead and while we're talking, I ordered a pair of the classic insoles because they look really cool. And there is a big opportunity here. In terms of the person you're going after, are you going after people who are just walking and going to work or are you also targeting athletes and runners, for example?

[Robin Hall]

Yeah, I mean, we do both. I mean, I think we sort of say anyone with pain is a great market. I'd say a lot of our customers are people who work for many, many hours of the day on their feet. So that could be a doctor or a professor or a bartender. And then yeah, of course people who are very active will often develop more issues related to unsupportive shoes.

[Isaac Larian]

So, you know, Isaac, they're also doing something really interesting here. I think you're doing a lot of things right. So when I went to the checkout, while we were talking, it offered me another deal and then I said, no, I don't want. And then it offered me another deal and I was like, I thought about it, you know, you're offering, well, do you want to order three more for this? You know, 40% off. And I think that's really smart I looking at the way you're running your business, Libby. I'm going to go on a limb here, Isaac. I'm going to say they should keep doing what they're doing as long as they can and keep growing as much as they can for as long as they can before they go out and raise more money. And. But you're right, when they do raise money, it's got to be somebody with strong CPG experience who has connections at Target and Walmart and who can really not just get you on the shelves there, but can get you maybe an end cap or can get you, you know, like maybe a promotional, you know, partnership as well.

[Megan]

Yeah, absolutely. I agree with you 100%. You know, maybe as big as MGA is, we don't have a bank line. We don't have any investors in here because I did that previously and the banks and the investors are for you. When it's sunny, when it rains, they all run away. So I agree with Guy. I think you should self run it as much as possible and then get it into mass merchants.

[Robin Hall]

Yeah.

[Isaac Larian]

Do you see this brand as like down the road as a target for acquisition buy like a Dr. Scholl's or one of these bigger brands?

[Robin Hall]

I think so. I mean, I think there's a lot of different brands that we could work with that can be great partners, whether it's someone that offers existing insoles and wants to expand their category. Or it could be a comfort footwear brand or it could be something more in like the CPG category. I think there's a lot of great potential partners.

[Isaac Larian]

And then down the road, do you see yourself potentially expanding into other categories, like actually like footwear?

[Robin Hall]

Yeah, it's definitely something that we're considering. I mean, we very much listen to our customers and that was why we started with slippers. It was the product that everyone asked for the most. They said, you know, we can put folded insoles in our shoes as we're walking around, but we can't wear them when we're home. There's no, they don't really have supportive slippers, so that's why we're starting. But I definitely, I think that there's opportunity for another brand of supportive cork footwear for sure.

[Isaac Larian]

Isaac, final thoughts for Libby.

[Megan]

Yeah, I think you're on the right track. I don't know how you market testimonials. Authentic testimonials is the best way of marketing. Oh, I bought this. I had my back pain and it changed my life. I think word of mouth is the best form of marketing. And that's something else I would do.

[Isaac Larian]

Especially with a product like this. Isaac, when people are like, oh, my gosh, you know, it completely helped with my posture. And maybe offer people incentives. Offer them, you know, 20, 25% off or a free, you know, free pair if they are, if they'll do that, if they'll post about their experience and.

[Megan]

They post that on your website. Testimonials is. Testimonials are one of the best, best way of marketing ever.

[Isaac Larian]

Ask Isaac. Look at lol. Surprise dolls.

[Megan]

Right? Exactly.

[Isaac Larian]

I mean, millions and millions of kids unpacking those dolls.

[Megan]

Right? Good luck to you.

[Isaac Larian]

Good luck, Libby. The brand is called Fulton.

[Robin Hall]

Thank you so much.

[Isaac Larian]

Congrats. Congrats. Thanks for calling in.

[Robin Hall]

Thank you.

[Isaac Larian]

Great advice, Isaac.

[Megan]

Yeah, thank you.

[Isaac Larian]

You're pretty good at, pretty good at what you do.

[Megan]

Yeah. Thank you. Thank you. I have a lot of. I have a lot of scars.

[Isaac Larian]

All right, we're going to take another quick break, but we'll be right back with another caller. Stay with us. I'm Guy Raz, and you're listening to.

[Guy Raz]

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[Isaac Larian]

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[Guy Raz]

Welcome back to the.

[Isaac Larian]

Advice line on how I built this lab. I'm Guy Raz and today I'm taking calls with Isaac Larian of MGA Entertainment. So let's bring in our final caller.

[Guy Raz]

Hello.

[F]

Hey Guy and Isaac. I'm a first time caller, longtime listener. I'm Robin hall from Town Hall. See what we did there? We're based in Steamboat Springs, Colorado. Town Hall Outdoor Co designs durable purpose built outdoor apparel for adventurous kids using sustainable materials. Think snow jackets, snow pants and gear for every season for every kid to love outside.

[Isaac Larian]

Awesome. Welcome to the show, Robin. Thanks for calling in. So. So Town hall only for, for kids. This is not like a, a brand for adults.

[F]

Correct. We do. We dabble in some adult, you know, hats and hoodies and some adult puffies. Limited quantity, but nope, this is, we're laser focused on kids.

[Isaac Larian]

And you're in Steamboat Springs, which has winter and summer activities, I'm, I'm sure mountain biking, hiking in the summer or horseback riding in the winter. Obviously skiing and snowball.

[F]

Seatown usa.

[Isaac Larian]

Yep. Yeah. By the way, when did you found the business or launch it?

[F]

We were a Covid baby. So 2020 March. I was working away at an incredible career at a little brand called Smart Wool. They make merino wool socks and apparel and their parent company moved them to Denver and our family looked at each other and said, we can't leave this incredible community of Steamboat Springs. I want to raise our kids here. So we're staying and so I've got to do something. So it kind of came together in this little Venn diagram where we said, why are we staying in Steamboat? It's the kids and community. What are we good at? Outdoor apparel and what are we passionate about? And it's the planet and keeping our kids dry and happy to play outside longer. So those four things met in the middle and Town hall was born.

[Isaac Larian]

That's awesome. So you already, I mean you were at smartwool. You already had industry experience and you figure, hey, I've got the connections, I have the know how. Let's do this. And did you raise capital Is this totally self funded?

[F]

It is self funded. We are approaching a funding raise because we need to. As you'll hear from some of our questions, we have been, as my pal Missy park from Title IX says, we've been hitting singles and it's been going great. We're growing steadily, but, boy, we need to start stringing together some doubles here to really give this a go. We hired our first employee. I took my first salary last year. So good things are happening. We're in distribution and rei. We're partnering with Title IX on a jacket this fall. But. But really there's, you know, we see the opportunity, it's proven. We need to get some money in to really keep driving.

[Isaac Larian]

Got it. Okay. And what's your question for us?

[F]

Yeah, my question is, Isaac, Gosh, your grit and ability to make take big risks is awesome. And I'm in awe. So we're wondering, what bold move would you make to help town hall break out? And how do you know when it's worth the risk?

[Isaac Larian]

All right, great question, Isaac.

[Megan]

Larian, Robin, before I answer that question, I have a few questions, please. How big is your business?

[F]

Yeah, we're hoping to do 300k this year.

[Megan]

Okay. And what profit margins do you make?

[F]

We're at about direct to consumer. We're at about 65ish. And then of course, we do. We're in about 17 wholesale stores around the country.

[Megan]

Okay, that's great. My last question is, why did you call your company Town Hall?

[F]

My name is Robin hall, so we needed to do something with my last name. It works well. And a town hall is a key community gathering place where everyone's welcome to share ideas, impart, change, and come together. It's kind of the community hub, and that's what we like to be.

[Megan]

Okay, I appreciate it. So sorry for being very direct.

[F]

Please.

[Megan]

But it's great that you're using your last name in the business, but that name, town hall, doesn't resonate with the product you're selling. The first thing I would do if come up with a name that people can relate to. So they don't think about a town hall with President Trump or somebody else. But noted, that's the first thing I would do. It could be a division of the town hall, but change the name because names matter. And I'm going to give you one example. You know, when we came up with Bratz, we came with over 25, 30 different names and we tested them. None of them resonated. And I wanted to have a five or six letter word for the brand. So. And Bratz with an S had a negative connotation with it. So we went with Bratz. That was a gusty move to do. We changed this S to Z. And if you look at the Bratz logo, it has a halo on the top. That means that they're angels. But the name by itself created newsworthy buzz and was very important to change the company. As far as raising money, I don't like private equity. Bank loans are okay. I wouldn't give a portion of my business to somebody else. I would try to sustain the business. I have have a business plan. Go to your local bank and get a loan and to fuel your company to feel your company.

[Isaac Larian]

Isaac, first of all, I appreciate your very, very, very honest feedback. And here's what I would say to you about that. Robin. We have had, I would say, more than you would imagine, brands on this show that four, five years in, changed their name. Poppy is a great example. Poppy, which was sold for $1.8 billion, did not start out as Poppy. Started out as, like, mother's earth or something like that. And they only changed it to poppy in 2019 in. So it's not as sort of daunting as it sounds. I mean, you could still continue to call it town hall and continue to sell the apparel and disregard Isaac's advice. But if it's something that you did want to think about, it's very doable, and it's a lot more common than you imagine. So it is a possibility. And not to say you don't have to do it, you should do it or not. But I'm just saying, here's what I would say about a bold move. One of the things that I noticed, and I'm sure you know this, is that that kids, especially the target age you're talking about, they just get crazy for a certain kind of brand. Like, especially, you know, I look at my boys now, they're all wearing viori. I don't know why all of a sudden we did viori on the show a couple years ago. They all want to wear viori. Girls, Aviator Nation, preteen girls, all want to wear that sweatshirt. And so what is it that they're doing? I think it's worth exploring to see who is wearing that product and why and how do you identify those people. What kind of marketing have you been able to. Obviously, you're limited with your budget, but what kind of marketing have you seen that's maybe worked for you so far?

[F]

Yeah. I mean, back to this kind of community notion. We did 84 days of events last year, from everything from the Vale Kids Adventure Games to partnering with rei, the Denver flagship, and having an event outside and bringing kids into our local farmer's market. And those go really far. Having me, the founder, tell the story one to one. Giving high fives, handing out stickers and free frisbees to kiddos are great. That said, it's hitting singles, so that type of marketing is very low budget, lot of hustle. Those are the areas we thrive on. But yes, that is one area where marketing is. We just need to raise our brand awareness. For sure.

[Megan]

I think you got to take a look at this and look at the bigger picture. You got to think, okay, I'm going to sell my product all over the usa, all over the world. So what is your niche? What's the difference between your product and somebody else's?

[F]

It's our focus on kids and that it's built and tested and designed for kids by kids. We do these things called kidsumer Insights, where we get kids on a blanket in the grass and we ask them a million questions about what they need out of a jacket, how they want to stay warm, what they think about colors, and then they inform everything we do. So we're not just doing that kind of shrink it and pink it notion that a lot of outdoor brands do for women and kids. We are really leaning into kids. And then parents love it and they hand it. It's so durable. They get to hand it down to three or four kiddos in their family or community.

[Megan]

Have you considered maybe talking to some of the parents, et cetera, who use your product and videotaping it for them to praise your product and then put it on YouTube or Facebook or other social media? Because I think that's one of the best ways for that market.

[F]

That's a great call. Yep. And I think, you know, as much as I get daunted by that takes so much work or dollars. I think honestly, the authenticity and it's very town hall just to have an iPhone and be doing quick interviews. So to your point. Yes, noted. That's a good one.

[Isaac Larian]

I agree with that, Isaac. I mean, I think that the most authentic, your most authentic sales reps are parents who are like, because I'm looking at your site now and you click on a jacket and you've got this cool thing at the bottom. The bur o meter warm, warmer, warmest. The splash o meter dry dryer, driest, which is super cool. So you want to hear the parent say, this jacket is the best jacket I bought for my kid. It's the only one that I've ever bought where my kid's not whining about being cold, you know, And I think that that's something that you could do, you know, fairly low cost.

[F]

I love that. I love that. And, you know, one of the challenges we have is we're ages kind of 5 to 14, and so, gosh, when it comes to social media, we're really only talking to kiddos on that upper end. And so we're really successful in the 5 to 10. You know, small, medium are our most successful sizes. So to your point, it's hitting the parents because those kiddos don't have phones yet. And thankfully, and the parents are really the influencers there. So great call.

[Isaac Larian]

Isaac, really quick back to you about Robin's question about a bold move. You said, forget about private equity and loans and all these. And I guess I want to push back on that a little bit. I mean, obviously the brand is still small, but if there was a partner who is experienced in the industry like Robin is, but who has capital and a good distribution network, why not come up with some kind of partnership or bring on some investor?

[Megan]

I tell you, the devil is in the detail. Most of these, what I have seen, they write the contract the way it is all in their favor because you need the money, and they have the money, and they hardly lose money. They take over your business, so you lose your business. If you have. If you have people who you trust is very important to be partnered with you. That's the first thing. And secondly, get a good lawyer to make sure that you're protected down the road. Otherwise, I wouldn't do it. I mean, you can borrow money at a lower, lower rate from a bank and they don't have ownership. I would go that route first, and then I would go to get an investor if I cannot get enough money from my bank. And be very careful with the contract. Spend the money. Hire experienced lawyer to read your contract so that you're not taken advantage of.

[F]

Great.

[Isaac Larian]

I love that advice. Robin Hall. The brand is called Town Hall Outdoor Company. Thanks so much for calling in.

[Megan]

Change the name Robin.

[F]

All right, I'll let you know. I'll keep you posted. Appreciate you guys so much.

[Isaac Larian]

Thank you, Robin. All right. Thank you.

[Megan]

Thanks.

[Isaac Larian]

You know what? We did an episode of our show with Simon Cowell, you know, from America's God, cut talent, right?

[Megan]

Yes.

[Isaac Larian]

And I asked him, I said, you know, you're mean to people.

[Guy Raz]

And he said, no, I'm not mean.

[Isaac Larian]

I'm honest when I say to somebody, don't pursue singing because you're not going to make a living off of it. I'm not trying to be mean. I'm trying to help them think about other ways for them to live their lives, you know, and I'm taking some inspiration from him. When you say to somebody, hey, change your name, I think that's, you know, it's.

[Guy Raz]

You're being honest.

[Isaac Larian]

You feel like they have potential, and one of the ways that they could maybe improve what they're doing is by changing the name.

[Megan]

Yeah, exactly. But also the other thing is, you know, I teach entrepreneurship once in a while at UCLA and Cal State la. And there was one guy in one of the classes that he's been going to school for the past 25 years. And. And I said, what do you want to do? He says, I want to be an entrepreneur. I said, you know, entrepreneurship is not for everybody. It looks like you're a professional student. And at the beginning, he got a little offended, but later on, he sent me a note and says, thank you so much. Nobody ever dared to give me that advice. And you're right. Now I'm going into teaching rather than starting a business.

[Isaac Larian]

I love it. It's awesome. It's awesome. Isaac, before I let you go, a question for you that I ask every guest who comes on to join me on the advice line, which is now, with all of your experience, you've offered a lot of advice now today to people. If you could go back to you when you were in your early 20s, still just trying to figure out what to do with your life, what advice would you give to yourself back then?

[Megan]

I would not change anything, guy. You know, as you know, I washed dishes and waited restaurants until I got my civil engineering degree. And my graduation day was the most depressing day in my life because I said, my God, what am I going to do with this? Go work for California highway patrol and make $60,000 a year? That's not what I wanted to do. But, you know, my kids as they were growing up, they asked me, dad, when you got a civil engineering degree, what did you do with it? You never worked as a civil engineer. Why go to school? And my answer to them is, engineering teaches you how to solve problem. And when you run a business, you have to solve problems on a daily basis. So it's like a brain muscle. So I would not change anything. I would not change anything.

[Isaac Larian]

I love it. That's Isaac Larian, founder and CEO of MGA Entertainment the brand behind Bright Stahls and Lawless Surprise and so many others. Isaac, thank you so much for coming back onto the show.

[Megan]

Guy, thank you for having me. I appreciate it.

[Isaac Larian]

And by the way, if you haven't heard the story of MGA Entertainment, Isaac's episode, you've got to go back and check it out. I know I say this every time, but please do it. It is a fantastic episode. I actually just made a social media clip about the power of no and how Isaac really learned that the word no is not the end but the beginning of a conversation. So go check out that episode. And here is one of my favorite moments.

[Megan]

I went to a guy named Ron Stover who was the buyer at Walmart. Very tough to sell products to. I can't be the next doll. He said no. One day he took me to Walmart and showed me this 98ft of Barbie products. He says, I you see these, they own 90% market share. They sell and I make my bonuses every year. I said, ron, what if I came up with something better than Barbie and you didn't buy it? You're going to feel left out. So I came back and told my design team, give me something that competes with Barbie.

[Isaac Larian]

Hey, thanks so much for listening to the show this week. And by the way, please, please make sure to check out my newsletter. You can sign up for it for [e-mail] or on substack. And of course, if you're working on a business and you'd like to be on this show, send us a one minute message that tells us a little bit about your business and the questions or issues you are currently facing because.

[Guy Raz]

We would love to try and help you solve them.

[Isaac Larian]

You can send us a voice memo@hibtid wondery.com or call us us at 1-800-433-1298. You can leave a message there and make sure to tell us how to reach you. And by the way, we'll put all of this in the podcast description as well. This episode was produced by JC Howard with music composed by Ramtin Arablouei. It was edited by Andrea Bruce.

[Guy Raz]

Our audio engineer was Jimmy Keeley.

[Isaac Larian]

Our production team also includes Alex Chung, Karla Estevez, Casey Herman, Elaine Coates, Chris M. Messini, Kathryn Seifer, Kerry Thompson, Sam Paulson, and Neva Grant. I'm Guy Raz and you've been listening to the advice line on How I built this Lab.

[Guy Raz]

If you like How I built this, you can listen early and ad free right now by joining Wondery in the Wondery app or on Apple Podcasts. Prime members can listen ad free on Amazon Music. Before you go, tell us about yourself by filling out a short [e-mail] survey.

[G]

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