This guy built a $1B+ brand in 3 years. The product? You'd never guess

Summary

Podcast Summary: My First Million – "This guy built a $1B+ brand in 3 years. The product? You'd never guess"

Podcast: My First Million (Hubspot Media)
Episode Date: April 24, 2026
Hosts: Sam Parr, Shaun (Shaan) Puri
Guest: Chad (Founder of Groons)

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Episode Overview

This riveting episode features Chad, founder of Groons, who built a $1B+ nutrition brand in only 32 months. The hosts dive into Chad’s journey from ideation to explosive growth, dissecting the critical decisions, marketing tactics, frameworks, and mindset that propelled Groons to a billion-dollar exit. The conversation covers the vital importance of product innovation (especially in product formats), the mechanics of scaling an e-commerce brand, the value of access and earned opportunity, and the ethics and challenges of building both a team and a brand with staying power. Chad generously shares insights, metrics, frameworks, and philosophy—making this a must-listen/masterclass for aspiring entrepreneurs.

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Main Topics & Key Insights

1. The Groons Origin Story

[00:28–05:32]

• Stumbled Into Entrepreneurship: Chad didn't intend to start another company, aiming instead for a quieter MBA experience at Stanford. The idea for Groons sparked in Utah when he realized drinking greens powder was an unpleasant, unsustainable habit.
• Moment of Insight: “How do I take a comprehensive supplement nutrition and put it in some format...that gets people looking forward to it?” ([02:11], Chad)
• Product Market Fit via Format Innovation: Chad envisioned a delivery method people would love—eventually landing on gummies (pushed by his own massive sweet tooth).
• Key Framework: "If you want to have the greatest odds of success, it's by creating a new format. New formats win." ([00:09], Chad)

2. Planning for Scale and Early Execution

[03:43–08:54]

• Audacious, Data-Backed Forecasting: Chad leveraged experience and proprietary data from his PE background, mapping LTV and CACs for dozens of e-comm brands. Early forecasts for Groons were closely met, a rare feat.
• Growth Metrics: Within a month, Groons hit a $1M run rate, scaling to $100M and then a $1B+ valuation in under three years.
• Quote: “We’ve basically met the forecast that we put in place since the very beginning.” ([03:59], Chad)

3. Inspiration and Benchmarking

[05:32–07:32]

• Dr. Squatch as Model Brand: Groons emulated Dr. Squatch’s approach to branding and product joy—making personal care and supplementation fun, partnered, and lifestyle-driven.
• Memorable Partnerships: “They’ve done partnerships with Harry Potter, Star Wars, SpongeBob…” ([06:08], Chad)
• Contrasting with fear-tactic supplement ads: Groons aimed for resonance and positivity over scare tactics.

4. Product Format and Differentiation

[13:14–21:19]

• Rapid Ideation to Execution: The gummy format became clear quickly, catalyzed by Chad’s own candy habit.
• Category White Space: The real unlock was making a serving 8 gummies—allowing for comprehensive nutrition (not possible before in a single piece).
• Core Differentiation: Chad argues true scale comes only from a product that creates/exploits new whitespace via format innovation—whether it’s supplement jellybeans, lollipops, or bamboo bedsheets.
• Quote: "Good product equals new white space." ([16:21], Chad)

5. Scaling, Key Metrics & Economic Engine

[08:54–25:13]

• LTV/CAC as North Star: Table stakes for acquirable e-comm: at least 3x fully loaded, gross profit LTV to CAC over 3 years.
• Emphasis on Contribution Margin: “I use a three year period, so 36 months, and LTV is fully burdened gross profit…” ([09:27], Chad)
• Growth with Financial Discipline: Early CAC ceiling set intentionally low, then allowed to rise with traction.

6. Building a World-Class Team and Culture

[27:05–29:58]

• Biggest Challenge: Building and unleashing a true all-star team, giving people autonomy to operate like CEOs.
• Real-World Example: Gruons is stacked with 130+ high-caliber people, attributed to empowerment and removing barriers.
• Hiring Philosophy: “There’s legit people who are the best...We’re looking for people who have confidence to make decisions.” ([28:50], Chad)
• Advice: The founder’s job is to unblock—not control—talent.

7. The Groons Marketing Funnel Masterclass

[29:58–38:47]

• Fun, Relatable, Human Ads: “Poop? More like what other supplement brand do you know that's like being a little bit sassy…?” ([30:38], Chad)
• Tapping Trends Ethically: Instead of making unsupported health claims, Groons ran supportive, “best friend to Ozempic” campaigns.
• Relentless Testing: Hundreds of ads/month, with varied landing pages each tailored to specific angles—“Gut health,” “POOP,” “GLP1,” etc.
• Personal Origin: Chad built initial landing pages himself using Replo and recommends founders do the same.
• Systematic Approach: “Find new angles, test all over the place...Once you've identified an angle that seems to be running, then you build the entire funnel around it.” ([33:13], Chad)

8. Key Frameworks for Going from 0 to $100M+

[16:21–21:40, 22:13–25:13, 40:19–41:03]

• Two-Step Recipe:
  1. Find/innovate new product format (genuine whitespace)
  2. Drive a 3x+ LTV/CAC (fully loaded, 36 months)
• Caveat: The biggest “hack” is actually developing a better, differentiated product. Marketing can’t save me-too products.

9. Ethics & Reputation in D2C/E-Comm

[25:13–27:05]

• Cautious Reputation: Chad kept a low profile (“the dropshipper’s paradox”), cautious of overpromising or running exploitative offers.
• Evolving Industry: Many high-flying D2C founders learn over time, moving from shadowy practices to reputable, enduring brands.

10. Business Ideas, Frameworks, and Philosophies

[42:05–50:23]

• High-Conviction on the Power of Ideas: “People say ideas aren't worth anything...I disagree. I think ideas are worth so much in the right hands and in my hands they're in the right hands.” ([42:23], Chad)
• Shared a Consumer Finance Startup Idea: An “ACH distribution layer” that would automatically allocate direct deposits to bills, investments, and spending accounts—solving budgeting through automation and discipline.
  • “If you execute this right...you will have a financial outcome.” ([49:42], Chad)
• Access is Everything: Both a philosophy and practical life advice—earned access is the breakthrough for those outside privileged networks.

11. Giving Back & Legacy

[53:39–58:44]

• Access and Exposure: Chad credits mentorship, access, and exposure for his own rise. He emphasizes the moral obligation to create opportunities for others, particularly young people without privileged backgrounds.
• Earned Opportunity: Hard work for mentors leads to access; overdeliver and trust the payoff will come.
• Quote: “When you don’t have [access], surround yourself with people who do and do good work for them, and you will get access every time.” ([50:46], Chad)

12. Wealth, Mindset, and The Road Ahead

[59:21–64:22]

• Mindful Wealth Deployment: Chad stresses caution and reflects on how best to use his wealth for impact, favoring direct action over passive investing.
• Still Just Beginning: “We’re like maybe five miles into a marathon.” ([64:22], Chad) – Groons is expanding with over a dozen new products in the pipeline.

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Notable Quotes

• “If you want to have the greatest odds of success, it's by creating a new format. New formats win.” ([00:09], Chad)
• “Good product equals new white space.” ([16:21], Chad)
• “We’ve basically met the forecast that we put in place since the very beginning.” ([03:59], Chad)
• “When you don’t have [access], surround yourself with people who do and do good work for them, and you will get access every time.” ([50:46], Chad)
• “Ideas are worth so much in the right hands and in my hands they're in the right hands.” ([42:23], Chad)
• “The founder’s job is to unblock—not control—talent.” ([29:58], Chad, paraphrased)
• “I could tell you what, like every big brand's LTV, the CAC and margin looks like.” ([03:59], Chad)
• “Marketing can’t save a mailed-in product… a better product is typically what it comes down to.” ([40:44], Chad)
• “Access is everything.” ([50:23], Chad)
• “We’re like maybe five miles into a marathon.” ([64:22], Chad)

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Timestamps for Key Segments

| Topic | Timestamps | |--------------------------------------------|-------------------------| | Chad’s origin & inspiration | 00:28–05:32 | | Growth planning & early metrics | 03:43–08:54 | | Influences & Dr. Squatch analogy | 05:32–07:32 | | Format innovation & product white space | 13:14–21:19 | | LTV/CAC and scaling economics | 08:54–25:13 | | Building & empowering an A-team | 27:05–29:58 | | Marketing funnel & campaign strategies | 29:58–38:47 | | Going from 0 to $100M+ (frameworks) | 16:21–21:40; 40:19–41:03| | Ethics and D2C industry evolution | 25:13–27:05 | | Business ideas—ACH distribution startup | 42:05–49:42 | | Access, exposure, and legacy | 50:23–58:44 | | Mindful wealth & future plans | 59:21–64:22 |

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Memorable Moments

• Chad’s radical honesty about naming (Groons): “I do not care how you pronounce our name as long as you're buying.” ([10:50], Chad)
• Breakdown of self-built landing pages (and Replo shoutout): ([37:49–38:32], Chad)
• Hilarious ad angles—“Poop? More like…” ([30:38], Chad)

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Summary

This episode delivers a potent blend of e-commerce frameworks, founder psychology, proven marketing tactics, and hard-won wisdom for scaling beyond mediocrity. Chad’s unconventional journey and perspective challenge listeners to focus on product format innovation, the primacy of team empowerment, customer-centric marketing, and the multiplier effect of access and exposure. The insights are both technical and deeply human—making it a blueprint for future billion-dollar founders.

Recommended For:
Entrepreneurs, e-commerce operators, marketers, and anyone pondering how to truly break out in a crowded market.

Transcript

[Sam Parr]

Zero to over a billion dollars in 32 months. Maniacal.

[Chad]

We're quite literally just getting started.

[Shaun]

Where do you think is that gap to really jump from average or good to great?

[Chad]

If you want to have the greatest odds of success, it's by creating a new format. New formats win.

[Shaun]

You obviously spotted one really great opportunity. I'm curious what other opportunities you spot.

[Chad]

I think there's an idea that no one else is going to be able to run at. That is a $10 billion business idea.

[Sam Parr]

You should just say it now and we'll bleep it out.

[Chad]

We'll talk about that. I think that's the biggest opportunity for founders.

[Sam Parr]

What are the inputs necessary to get to 100 million in revenue for an E Comm brand in three years?

[Chad]

Here's what I'll say. I feel like I could rule the world. I know I could be what I want to.

[Sam Parr]

I put my all in it.

[Chad]

Like, no days off on the road.

[Sam Parr]

Let's travel.

[Shaun]

Here's. Here's three things I would love for you to deliver. One, I want to know the origin story. Like, how the hell did you have the idea and why did you have the confidence in the idea? We're going to go there. Two is you sent us a thing about your marketing funnel, which is like, you know, what does world class marketing look like in this scenario? And then the last part, I want to riff with you, brainstorm on, like, where to from here. You obviously spotted one really great opportunity. I'm curious what other opportunities you spot.

[Chad]

Yeah, let's do it.

[Shaun]

Okay. Sweet. Dude, I've been. I've been taking groons for, I don't know, six, six to 12 months now because it's like, it's basically like eating candy. It's like you open up a pack of gummy bears and then you eat them and then you're like, I just had vegetables.

[Sam Parr]

Totally.

[Shaun]

I hate gummy bears. But I. I think I just had vegetables, maybe.

[Chad]

Totally.

[Shaun]

And so I want to know where were you sitting when you were like, you. But what if we did this?

[Chad]

Yeah. So I like to describe myself as a entrepreneur who had short stints in private equity and investment banking. So I've. I've started three companies. This is my third company, and I actually didn't want to start a company. So I was on my way from Boston at a private equity firm called Summit Partners and was leaving that investment firm to go get my MBA at Stanford and had told myself, look, I just want to have like a normal MBA experience for two years. I'm not going to start anything. Maybe I'll do an internship in the summer. And then it was like two weeks before going out to Stanford. I was at my parents place in, in Utah and just doing some work and I'm drinking a greens powder. I'm in my dad's office and I just remember looking up like super vividly in the, in the corner of the room and being like, there's no way I'm keeping this habit past 30 days. Like I'll, I'll do it because I always finish what I started but like I'm not gonna stick to this habit post 30 days. And it wasn't just the taste it for me it was like, you know, you got that weird like frothy sediment at the bottom of the drink. And the biggest thing for me that I think this is probably unique is I, I remember staring at the bottle sitting on the countertop on like the drying rack. And I remember being, and I'm sort of an OCD person. I remember just being like, if I commit to this habit, I've gotta like stare at that bottle on the countertop for the rest of my life, right? Like there's, there's just no way that's going to happen. And so that got me thinking about, hey, how do I take a, a comprehensive supplement nutrition and put it in some format? I didn't know it'd be gummy at the time when I had the idea. How do I put it in some format that gets people looking forward to it? Like they'll go to bed at night being like, I can't wait to have that the next day. Which, which is a complete pivot, I think, to how people sort of think about supplementation.

[Sam Parr]

Can we like roll it into a blunt now?

[Chad]

Yeah, exactly.

[Shaun]

Look, hey, let's smoke your greens.

[Chad]

We'll talk about that. I think, I honestly think that's the biggest opportunity for founders. Like people just want to rip on the formats that work. But I think if you want to have the greatest odds of success, it's by creating a new format, right? So if it's a blunt, awesome. If it's these little zen pouches that people are doing now and making those like focus so it's non nicotine great, like new formats win.

[Sam Parr]

Did you think that, I mean, just, it's maniacal. 32 months to a billion dollar exit is maniacal. Did you call your shot and you're like, that's where we're going to go or were you like, who knows? I mean, where was your mindset? When you started it.

[Chad]

This is a bit shocking to hear, but we've basically met the forecast that we put in place since the very beginning. You have to appreciate I was, I talked with like thousands of entrepreneurs when I was at Summit Partners. I looked at the proprietary data sets. I don't have them obviously anymore, but I have a very visual memory. So I know the LTV, the CACs of hundreds of brands. And so like for me it's weird. Like I could tell you I won't, but I could tell you what, like every big brand's ltv, the CAC and margin looks like all the brands that we know of today. Now I didn't really forecast beyond 100 million of revenue because that would be pretty pointless.

[Shaun]

Like I'm not a sociopath. Yeah, there's a fine line between ambition and being just absolutely batshit. So you're, you're saying that now I want to ask you something about in between when you're like, oh, like I don't really enjoy this form factor. What if there was another. And you said you didn't have gummies, you know right away as like a, it's not like you immediately had the fully baked idea. But I'm curious, like what were the either companies or products you had like admired? Because I sort of have this, this thing which is like what you admire becomes a little bit of your destiny.

[Chad]

Right.

[Shaun]

Your admiration becomes your destination. And if you think about like a lot of a great, great entrepreneur, Steve Jobs, famously, who did he admire, what products did he admire? And then you steal little elements of that, they sort of bleed out into your final products years later. Same thing with comedians and movie makers. What were the products and companies that you thought were kick ass that you feel like inspired? Some of the result of groons.

[Chad]

Yeah, look, I sat on the board or observed the boards of great brands like Ruggable, Dr. Squatch, Brooklinen, Chubby's, Solo Stove, Thuma. 12 different businesses. And so I learned a lot from the unique problems and frankly the recipes that worked for each of them. I would say that the brand that I think we most closely resemble in terms of execution is Dr. Squatch.

[Sam Parr]

Is that deodorant?

[Chad]

It's the cold processed soaps, the, the bar soaps that for men.

[Shaun]

I've seen like the marketing, but I, I think I have the deodorant, but I, I don't know what's the, what's so special about it? Like is there something cool about it?

[Chad]

So what's cool about it is so they Just sold the Unilever like last year for 1.5 billion. And, and that business, what's cool about it is one cold processed soap is more natural, I would say. So it's. You're not getting all the chemicals and stuff in and it's a very clean product. But because of the branding, the approach, the partnerships they do, I mean, they've done partnerships with like Harry Potter, Star Wars, SpongeBob, all sorts of really cool, like, fun partnerships. They've taken an approach where you as a consumer relate to the brand. Right. And so prior to Dr. Squatch, I don't even know what I was using. I was probably using what I. Whatever my wife was buying and stocking in the shower. But they were the inspiration for us. I think that what they've done within the personal care space, making it a joy for the consumer, is what we aspired to do within supplementation, where, I mean, we all spend time on social media. You get one ad and it's like, oh, my goodness, Sean, Stan, I don't know how old you guys are, but you're blank years old and you've never heard of creatine. What the hell are you doing with your life? You're going to die tomorrow. And then you get a Colostrum app. What are you doing with your life? You need to be taking Colostrum right now. It does a blank percent increase in blank body metric. And I just think that the way that we have approached and took inspiration from Dr. Squatch is to take that and make our supplementation a lifestyle, something that people look forward to. They feel like it resonates with who they are and how they live their lives.

[Shaun]

All right, let's take a quick break. This podcast is called My First Million. And it's probably the question we get asked the most. How do I go from zero to making my first million? And so I did an episode a little while back where I broke down exactly the sort of philosophy and frameworks that I would use. So things like finding your white belt business or identifying your bear on the unicycle advantage, the core way that your two skills can overlap. Or why maybe starting a service business is better than starting a software business for your initial businesses to make that first million. And so the team at HubSpot has created a guide that took the stuff I said in that episode. They laid it all out for you. You can get it for free in the description below. Just click that link and it's all yours. All right, back to this episode.

[Sam Parr]

How much money did you Raise to get to your first million in revenue. And how fast did it come?

[Chad]

Yeah, month one we did like 30,000 of revenue and month two is already like 230,000. So I guess we like in month two, a month into the business we had already crossed the, the 1 million run rate. Probably 2 and a half, 3 million at that point. I've never really looked at the business that way. Maybe you've heard me talk about ltv, the cac. Yeah, I would say we burned, we probably burned through like $8 billion of capital until we reached profitability. That could have been less if we slowed down growth a little bit. But just the way it worked out is I think we've earned through about $8 million of primary capital before we hit profitability.

[Shaun]

You mentioned like focusing on LTV to cac for you, what's good and what's great?

[Chad]

Yeah, I think table stakes for businesses that need to be acquired, you need to be at least three the best. I saw one. Obviously this goes where we're at, but during the COVID era I would see brands in the four to five range. You know those brands are probably two and a half to three times right now.

[Sam Parr]

But when you say ltv, are you referring to. So LTV lifetime value is for, for an E Comm brand. Does value mean your contribution margin?

[Chad]

Yeah, let me describe that the way that I always look at it. I use a three year period, so 36 months and LTV is fully burdened gross profit, meaning Sam orders our product. What are the total costs stripped out of that value to get it to Sam's door? So you've got product cogs, you've got discounts, returns, you've got fulfillment, shipping, merchant processing fees, you've got all of that. That gets it to the door. That's your lifetime value over a three year period. How much contribution gross profit are you getting from the consumer over a three year period?

[Sam Parr]

And you use three years not because that's how long someone subscribes to groons. You just said three years for everyone should use three years.

[Shaun]

You can't do a lifetime.

[Chad]

Ye think it, I think it's like just a productive way of looking at it to optimize against. I mean we Obviously look at 3 months, 6 months, 12 months and try to make adjustments based on that. But yeah, I mean we've got consumers who are, you know, are 32 months old. So we, we haven't hit that 36 month mark. But like there's very clearly going to be consumers who are around purchasing into

[Shaun]

I guess, quote, perpetuity, and you picked a name that, if you had told me, I would have been like, hey, brother, do you want to win? Or are you going to put a umlad over one of the letters and nobody knows how to say it? And then you won. So I'm an idiot. What? What? What's the. What gives?

[Chad]

So what I always say here is. And Sam Botched grins. At the start, he said gruns, which is totally fine. What I tell people is. What I tell people is I do not care how you pronounce our name as long as you're buying. So, like, you can call it Grunds if you want. You can call it Groons, which is cracked. It's groons.

[Shaun]

But did you think it was a good name and you knew something none of us do, or did you just not care about the name? And how the hell did you arrive at that name?

[Chad]

Yeah. So the word gruns with an S, I guess I can show you here with an S at the end, actually doesn't mean anything in the German language. The word grun means green in German, but once you throw an S on it, there's actually no meaning to it. And so when I threw an S on just seemed to be, like, kind of fun and playful. You've got this, like, natural smiley face. It felt like something that we could brand over time really well. And it's. It's simple. But you're right, like, at least in America, very uniquely In America, like, 70% of consumers don't know how to pronounce it.

[Sam Parr]

That'd be, like, your argument to the team. Like, no, because it makes a ton of sense. Now, it may not make sense in America, but, like, yeah, Sean, we had. We had this guy David on, who runs a company called Lexicon, and his whole job is naming companies. He's named Swiffer, Febreze, Sonos, BlackBerry. Sean, what do you think David would say about that name?

[Shaun]

Well, it's hard to know, right? Because he's got this little AI computer brain where he's like, yes, no. And it's almost like a sommelier describing the taste of a wine. And then you just have to nod along like an idiot, be like, yeah, I. I sense the notes that you're talking about there. I thought notes are for music, but I definitely sense it. And so, you know, I think it's hard to know, but I would have guessed low.

[Sam Parr]

Right.

[Shaun]

You're talking about, like, doesn't make much sense in America, the market we're going after. But you did it anyways, what was runner up name or you know, in the brainstorming process sometimes you start with like here's what we're definitely not going to call it because it kind of guides you away from maybe some typical areas.

[Chad]

Honestly like I hit it pretty quick so I guess I didn't mention this. I served, I grew up Mormon so I served a two year mission in Germany, Switzerland, Austria. So like I am fluent in German. And so when, when I had the thought.

[Sam Parr]

Pretty sick assignment.

[Chad]

Yeah, totally. It's literally called the Alpine German speaking mission.

[Sam Parr]

So yeah, like you know, someone else could have been assigned to like you know, reading California or.

[Chad]

Yeah, totally. That wouldn't be too bad. That wouldn't be too bad. There's worse.

[Shaun]

All right, so you have the ideas. How long did it take you to go from idea in your head to I know what the product is gonna be and I have my first batch and then I go for sale. Like what was that timeline like?

[Chad]

Yeah. So coming up with gummies took about a day. I grew up. You're gonna think it's crazy. You know those like big like I guess they call em like single day servings of sour patch watermelon slices. Yeah, yeah. I would eat those gummies, one of those every day in college. Like a full 450 calories every day. I've always been a gummy fiend and so now I get to obviously have like a productive health gummy every single day. And there's a ton of them that we sell. I have a ton of ideas always circulating in my head and this notion doc I have and typically I sit on those ideas for about a year. This one I was like, it's so obvious I got to do this. I'm the right person to do it. And so I started working on it immediately, getting it to launch. Now to answer your question, there's I immediately like within a week of having the gummy sort of connection said, okay, why hasn't somebody done this in gummy form? Right? Like you've got a ton of gummies. Why isn't somebody put comprehensive nutrition in a gummy? And the big aha moment for me was the entire gummy industry is built around these 60 or 30 count bottles, transparent bottles with a cap on the top that that is as gummy exists. So I asked the question what, what would need to change? What would it need to look like to have gummy be comprehensive nutrition? And then that's when I went down the path of like okay, if it's a you Know, a pack, how big is the pack? How many gummies are in it? What's the flavor of the gummy?

[Shaun]

Right?

[Chad]

What's the total?

[Shaun]

Sam, Sam, you've never taken the product, right?

[Sam Parr]

No. I'm gonna buy it now though.

[Shaun]

So the way it works is. This is a good point you just brought up, which is you don't like when we say it's a gummy. You think it's a, it's a gummy. No, a single serving, you eat eight of these things. So it's literally like having a pack of Sour Patch Kids, which I think was, you know, seems fine, whatever, but that's actually pretty non obvious. And if I'm reading between the lines or if I'm understanding what you're saying, you're saying one of the reasons nobody had done the comprehensive gummy was because the gummy would need to be like, you know, 4 inches large to contain everything. But what if we made it? What if we made it where it's not a gummy a day, it's a pack of eight. We package them as little pouches of eight. And that's how, that's how we can do this when other people may not have tried to do this.

[Chad]

Yeah, it's, it's, our packs are, it's about a, we go off of gram weight, which is about 20 grams and some grams are smaller, bigger than others. But yeah, it's a, it's a full. Every gummy is identical in terms of nutrition. It's sort of the total of the eight in this case that make up the full dose.

[Sam Parr]

I just think that it's insane that I asked you a question that I thought was going to be ridiculous about like you pointing like Babe Ruth and saying like, you know, we're going to get to this and you're like, yes, that was part of the plan. I mean it's pretty audacious to say I'm going to get to 100 million in revenue in less than three years. For the people listening, what are the inputs necessary to get to 100 million in revenue for an E Comm brand in three years?

[Chad]

So it doesn't have to be consumables. I think everybody points at consumables these days and they're like, ah, supplements. It's like it's a better business. It's not necessarily a better business because if you're selling a hard good like bed sheets or furniture, your margins are going to be worse. It's going to be more difficult to ship. Like there's a Lot of things in there. But you theoretically make money on day one in supplements. You don't. You got to make that money on the retention. So that's a new lever you got to pull to make the business work. So to answer it directly, Sam, I think first and foremost you've got to have a good product. And good product doesn't mean like make a better version of grins. Like that's not going to work for people. What's going to work is finding that product category, that white space. Good product equals new white space. So you've seen, I'm sure you guys have seen these like nicotine pouches, the whip and like ultras of the world.

[Sam Parr]

Like I would not encourage an energy. It's basically looks like a zinn, but it's not tobacco or nicotine, it's energy.

[Chad]

Yeah, it's like, like caffeine and other things like the nicotine pouches. Amazing. Not because I'm a believer in the product, but amazing because now you're taking a new format, a form factor that doesn't have competitors. And so I think anybody looking at it and be like, oh, I'm going to do it too. Like you might find a little bit of success but you're not going to sell your business, you're not going to be the winner here. Go find a new product format. Symbiotica. I came out with these little liposomals. Who else have I seen that that's created new? Oh, you've got like, do you know the product dose? It's like the liver health product. It's like these little shot glasses. It's like, it's like a concentrated liquid. That's another one I wouldn't.

[Sam Parr]

A concentrated liquid of what?

[Chad]

Liver. Like their supplement is a concentrated liquid for the liver. So look up, I think it's Daily Dose Co is the website. That's another product that has like a unique format. Another one for you. You guys know Mary Ruth Organics or Row Nutrition? R H O?

[Shaun]

Uh huh.

[Chad]

So those are like, I'm not sure if they're liposomal but they're like liquid vitamins. Right. Like their approaches were the liquid vitamins. And I'm shocked there's no, not more competition doing that. Like these are big businesses. Every single one of the ones I just mentioned is a big business doing really well.

[Sam Parr]

So the framework of this is taking a thing that everyone knows or many people know and just slightly changing the form the way you consume. But everything that you've named so far has been a consumable correct because that's

[Chad]

the space that I'm like, most familiar with and people typically are looking at right now. But, like, it would be the same thing. Like, do you know how big Cozy Earth is? Their whole thing was bamboo sheets. Right. And I don't. If you ask me. I'm sure other businesses sell bamboo sheets, but, like, that's their thing and, like, they're a big business as well. And so I could give you examples across all sorts of categories. Obviously, supplementation is the easiest for people to visualize.

[Shaun]

Wow. So the step one, you're saying is good product, but let's say that less generically, what you're saying is the right product, and the right product is a category that's not already super saturated. And you either, either you take an existing category, you change the form factor to make it new, or you find a new pain point, new problem, new supplement, new whatever, and you're going to do it. You need some point of key differentiation. Your vitamins, but your liquid, your sheets, but your bamboo, your, you know, your greens, but your gummies. And you find that key point of differentiation which gives you new category. All right, that's step one.

[Chad]

Exactly. And to be clear, a couple that I've just seen recently. And then I'll tell you the step two. I've seen jelly beans is a form factor. I've seen lollipops. Right. Like, people are. Do I think that those businesses are going to be huge? Probably not like it's a little bit niche, but, like, they're probably going to be more successful than somebody making a gummy like us.

[Shaun]

Hey, stupid question. You started this by saying Sour Patch Kids. Yeah. How come none of the gummies are sour? Why doesn't anybody be like, it's sour? Vitamins?

[Chad]

Tbd, tbd. We might. We might give you something like that, Sean. I'm a sour fiend as well. I'm going to hit that. Don't worry.

[Shaun]

Sometimes I want to start the business, and then sometimes I realize, oh, I know, I'm just hungry and I just want to eat that thing and I don't need to. And this might be the category, or maybe I'm just hungry.

[Sam Parr]

You actually said something interesting. You said it's too niche. Is there a. What's your. To get you to 100 million in revenue? Is there. Okay, so you said take the form factor and then the second or. I don't know if it's the second thing, but there is a TAM related thing here. Is there like a threshold where you're like, this has legs.

[Chad]

Look like I'm, I'm a bit psycho, right? Like all I've seen around me is businesses getting to hundreds of millions of revenue quickly. So like my gauge for success is in the business I started. The first business I started, I literally sunset six months in, it was in a hundred thousand of revenue and 90% EBITDA margins. And I sunset it because I said this isn't big enough. Like this isn't. But that's how I'm wired, right? Like if somebody wanted to get to a $5 million cash flow business and run that, like that's, that's massive success. So I'm not going to like deter people from.

[Sam Parr]

But I want to know your, your threshold.

[Chad]

Yeah, my threshold. Well, I mean my, my sites are even bigger now, right? Like I'm still working on grins and nootropes and juiced and these products you see behind me. We have more than just grins now. Happy to talk about that. But I mean, at this point I'm looking only at stuff that can be one $10 billion outcomes. Somewhere on there, you know that feeling.

[Sam Parr]

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[Shaun]

So let's, let's keep going. In your formula. What's, what's. Did we do Step two or number

[Chad]

two, and this is the end of it is LTV to cac. So if you're, if your business has an LTV to CAC of three times plus, you are golden. Anytime people talk about profitability, anytime people talk about mer. I'm not sure if you're familiar with that. It's like marketing efficiency ratio. The way that you think about it is like if you're, if you spend 20% of your marketing or of your revenue on marketing, then the inverse of that is a 5x mer, right? So one divided by 2x.

[Shaun]

All you're saying is I want a machine where I can buy a customer for a dollar and I know that in 36 months that customer will pay me back $3 and I'm going to dump as much dollars as I can into the front of that funnel. As long as that's possible. And I'd say the key here is most people, I don't know, maybe I'm just wrong, but I think a lot of people think lifetime revenue, lifetime value as just revenue. And what you're saying importantly here is it's the, you know, totally fully loaded gross profit. So to get to three, you're probably actually doing six dollars of revenue on that customer. Close to a five. Five to six to get three bucks of gross profit off that, off that customer.

[Chad]

Correct. Whatever your margin is. But yeah, that's correct. You've got to do. But if you hit that three times, fully burdened gross profit LTV divided by your CAC and that equals three or more, you've got a business.

[Sam Parr]

How did you know that Groons was going to be one to three?

[Chad]

I didn't. I've seen enough to know how it might play out. But we, we came out with a cac. Everybody at our company since day one knew what our CAC ceiling was that would result in a three times or greater LTV the cac.

[Sam Parr]

Can you say what that number is or no?

[Chad]

When I first started, I mean, I can't really tell you, but what I'll tell you is it's 2x higher today than it was on day one of launching the business. Why? It's not because we magically got better ltv. It's because I set the CAC so low to ensure that we'd be able to hit it.

[Sam Parr]

So what does that mean then? Your ads need to be extra catchy. In order to make extra catchy ads, you need like a super good offer or a super good story or super like it's all of it.

[Chad]

It's kind of all of it. And that's where like I think this gets so difficult is people are like, you know, sometimes I see the shadow figures that are running these dropshipping companies and they're like Gruin's ads are bad. Like they're not even good. They're so like non creative. And that's because we're like a reputable company that doesn't say we can cure cancer or you like do these things that some of these shadow figures do. Like that's not creative. That's just actually like bad to do as a human. But like to answer your question, like it's not just like creating good, good ads. You gotta have the good offer, you've gotta have the good retention, you gotta have a good product. Right? You have to have a product that people actually wanna take on. Like our Amazon ltv. To CAC is phenomenal. Like, and that's on a platform where we're not advertising the way that you do on Meta. We're not like you don't have your subscription portal in a certain way. It's like a one click cancel button. And that's like leagues beyond what I've seen with other brands. In terms of Amazon Economics, DTC is

[Shaun]

one of these funny spaces. Like, I think I DM'd you.

[Chad]

I read our DM, Sean, from like, it was a couple years ago, man, it would have been like in 2023, like three months into the business. You're asking about the landing page.

[Shaun]

Yeah. So three months into the business. I was, I think I just sent you a compliment. I was like, hey, I think your landing page is really great. You know, I guess the interesting thing is you were really, you were quiet, right? Because there's this weird paradox, and I would call it the drop shippers paradox, which is sort of the louder somebody tends to be about their e commerce success. I sort of, I sort of proportionally increase my skepticism. And I feel like you were very quiet and you built a killer business and then now once you've kind of like, you know, reached a big exit and a mountaintop, sure, you could talk a little bit more about it. You're doing a little bit sweating one more time. What do you think about that? What do you see when you look out at the landscape of like people who are, are quite vocal, quite loud on, on D2C, Twitter and other places?

[Chad]

You know, I, I want to have sympathy for how others run their businesses. And so what I will say is, like, I've had chats with some of these people who are louder, who are running, you know, these businesses that they, they're little shadow businesses. Like you don't know what their business is, but it's doing 100 million of revenue or whatever. And what I've come to realize is some of these people just don't know yet that what they're doing is inappropriate. Right? That the ads they're running are inappropriate. They don't really understand the consequences. They're, you know, they're fist bumping their friends about the Lamborghini they just bought. And so what I would say there is like, I think it's less about how loud people are. I think it's about the natural evolution that we all go through as we learn what it means to be like a reputable business person running like a clean business. And that comes with time. I have to learn most of it through amazing brands that. With great executive teams that I learned from, who are mentors and friends. And I think for some of these people, they're learning and it's going to take a little bit of time.

[Sam Parr]

So from the outside, I look at you and I think, well, you seem really. I've only known you for 30 minutes. You seem very calm. You seem very well balanced. You seem like a lovely person. The success has been off the charts and I think, well, everything's perfect. This guy's just had it all. Of course, that's not the reality. So what has sucked about this journey?

[Chad]

You know, it's funny, the team, we have this joke internally that I'm the chillest guy we know. And it's like sort of kind of true. Like, I am actually a pretty calm person. And I think mistakes are all part of the learning. Like, no business is perfect. A perfect business is one that learns quickly from the mistakes that it makes. And people aren't to blame for that. What I'll say is I could give you an example of actually a really rough day we had on January 29th of 2024, and I can tell you a little bit about that. But I would say the hardest thing about building a business like this that folks just don't appreciate is just how difficult it is to build a team of all stars. And more difficult than that. Unleash them. Give them the space to play and run and execute according to their abilities. And that's really been our unlock is one getting amazing individuals. I think if you look at our executive team, if you look at our entire team, right, the 130 people plus at this company, I think people would be like, that is a stacked team and they're not going anywhere. We're having a good time. Like, we've got a lot ahead of us that we want to do, and the culture here allows for them to excel in a way that they wouldn't be able to do off the road.

[Sam Parr]

Can you dive deeper on that? Because people always say hire the best people and all that, and I say that too. And. But it's. That's. I hate when I give that advice or when I receive it, because I'm not trying to hire the worst people. Like, I am. I am trying. So what is the best people actually mean? What is. What do you look for? What attributes?

[Chad]

Yeah, you know, it's so funny about the Sam. I've heard people be like, oh, well, like somebody could be the best for your role. And I'm like, no, no, no. There's like legit people who are the best. Like, you're probably just not able to hire them if you're saying like, well, we got the best for this, like narrowly carved out role. So when I say like the best is what we're looking for is people who have confidence to make decisions. Right? So everyone has the ability to be essentially a CEO. And frankly, I would not be surprised if we're talking five years from now. And a lot of the folks here at Gruins have started companies that are really successful because they've had that skill set, that repetition of making decisions as if they're the CEO. And so I would say that it comes down to just being like reps, experience, training in whatever function if you're a marketing person, a retention person, if you're a product person. And then the hardest part again, and this is where I think the people listening to this who might be founders or CEOs have to check themselves is how do you unblock these people? How do you get out of the way to ensure that everybody together is building something massive?

[Shaun]

I want to ask you about your marketing because I think you did world class marketing. Like we said years ago, I compliment first thing I ever said to you was yo, nice landing page, right? That's the highest form of respect I give. I want to actually open up here. Let me screen share. I want to show you your Facebook ad library and I just want you to talk us through sort of a 10 minute masterclass on marketing.

[Sam Parr]

So I want you to tell me

[Shaun]

what you see because you know, the average person will look at this, they don't really know what to take. I want you to point out what's interesting here. Let me see if I can zoom this a little bit. What's interesting here, what to notice, what to learn from that would apply to other people in their businesses. How to think about marketing the way you guys thought about marketing.

[Chad]

Yeah, I mean the first thing I see when you go back up, like what does it say? Poop? More like what other supplement brand do you know that's like being a little bit sassy with commentary like that? Now you see it a little bit more from these brands that are like just talking about their clinicals all the time, which nothing against clinicals. Like we do clinicals too and we test our product electively, well beyond what's sort of required. But like we just don't talk about it because that's not fun. And so like what I would say here is like, these are fun ads, right? Like this is like, if somebody sees that, they're probably laughing a little bit. Like, if you scroll down, you know, we spent some time on GLP1 as an angle, and I'm really proud the day that we decided to do this because everyone around us, and I don't spend enough time on Instagram to know everyone around us is like, nature is Ozempic. Or like, they. They'll say something like that, which is, like, objectively wrong. Like, you're not supposed to say that. We've never taken that approach. We are what we would say, the best friend to Ozempic, Tirzepatide, Zeppbound, whatever the sort of GMP ones are.

[Shaun]

So you were able to kind of surf that wave. You were able to hijack some of the momentum of that product and position yourself not as a replacement, but. But as a companion.

[Sam Parr]

Wait, why did you have. Why do you have an Olipop?

[Chad]

Okay, well, it was the GL. The GLP1's new crush ad was an Olipop image on it. And so we're running a limited time offer right now with Olipop.

[Sam Parr]

So this flavor, it's an Olipop flavor.

[Chad]

This is Gruins, which I guess you can see right here. I'm pointing to it in the video. Maybe people are on audio, but we've got Gruins, sort of original. And then, you know, every month or two months, we do these limited time offer drops with. In this case, it's Ollipop strawberry vanilla flavor. You know, the first one we did was like a Gruni Smith apple, like Granny Smith apple flavored. We did a Grinch Sour Grinch Punch last year in November. So we do these. This again, back to the whole, like, how do we make this fun? Like, you tell me one other supplement brand that's doing, like, drops and making it actually fun to take the product each day.

[Shaun]

So it looks like you've got different angles. So you've got. Hey, we're, you know, Ozempic's best friend. You've got poop more. You've got nurse. You know, the nurse here who's probably

[Chad]

talking about nutrient gaps.

[Shaun]

There's Jackie talking about nutrients. So you have these different angles. And I'm guessing that these each lead to a landing page that aligns with that message. Correct. So it's like, yeah, five, six different angles each to a tailored landing page that continues that message. And then you're. Are you doing that just to experiment to find one winner? Or you're like, no, we're going to keep running five or six of these because there's just different markets of different customers who have different mindsets and we're going to try to get all of them.

[Chad]

Yeah. To make this super applicable for people, you should test ads in high volume. So find new angles, test all over the place. Find what sticks with an eye towards being a human. Right. Don't, don't say that you like you're going to make somebody sex better if your product doesn't actually do that, like actually do the science. Validation. If your product can help with certain things. Once you've identified an angle that seems to be running then you build the entire funnel around it. So you've got, you've got static ads that talk to that angle. You've got UGC sort of hoist the camera angle. Ads that run at that, you've got like more like cinematic type shoots that run at that angle. Everything you're just plowing all sorts of ad concepts to or sorry ad structures to that angle. From there, where people land is really important. What people receive as a pop up is really important. What people receive as email and SMS is really important. Everything is tailored to that message. So if you came in on a Gut Health ad, we want everything tailored to, hey, you know, Sam just expressed interest in the Gut Health ad. Great, then Sam's probably interested in Gut Health. Let's give a pop up that helps them understand. What about Gut Health is he interested in that pop up informs what messages we send on email and SMS towards Sam's expressed concern. That page is dialed for Sam's intent and then on the back end of that once people have purchased. This is something that we're trying to put into process now is how do we talk to Sam long term? Yeah, he may have started on Gut Health but how would he, how do we get Sam to understand that there's so much more to this product than just Gut Health and do that over time building on sort of the foundation of why this product was important.

[Sam Parr]

Most everything you're saying, it's sort of like when I win read the book how to Win Friends and influence People. I'm like oh yeah, this is obvious. Makes sense, makes sense. But the hard part is execution and it seems like you're ruthlessly in a kind way executing what's. So I'm going to ask a bunch of questions I think you can answer in one in one go. How many ads and landing pages per month are you putting out? And I think you only said you had a 30 person team. That seems like a lot of Output for a relatively small team. Can you talk about like who's doing the work?

[Chad]

Yeah, we're probably putting out hundreds of ads a month, cycling in and out, just trying to find that next, you know, unlock. We try to create new concepts pretty consistently. So it's not just about ad volume. It's actually structured around like how much of that is like business as usual. Ads that we already know or structure or sorry concepts, themes that we know already work and how much of that is like we're trying to find new frontier of applicability in terms of the team. You know, when Sean reached out to me in December of 2023 saying hey, nice landing page, that was me, right? Like I was the guy that, who built that landing page. We didn't use an agency. I think I even said that in the message because you asked. That was me from the beginning. And you know, you see our buy box, it's that place where you do the add to cart. We've seen people rip that over the last three years copying that buy box. And if they only knew that random dude named Chad who's not like an E comm expert, you know, broadly across D2C. I know quite a bit but like I'm not an E comm guy who builds these sites. The whole industry is mimicking this, this format. Yeah, it's really interesting to see that. I think people need to test their own and since then we found new formats that work. But talking about the team, we've got people across, we've got like three folks on the retention team who do the emails, sms, who set up all the flows that allow for our consumers to have a good experience. So they're focused on after order one. What does that journey look like through order hundreds. Right. We've got a large team doing paid so creating ads. The actual creatives, we have probably four plus maybe five or six creative strategists who actually create the ads and then we have people who design and do the video edits and then we have the people who actually manage the ad accounts. Right. There's probably four or five of those who actually like are looking at the analytics, evaluating, passing back to the creative strategist saying here's what's working iterate on that. We've got an E comm team that's absolutely dialed the velocity coming out of E comm now. So landing page designs, iterations on the cart, checkout, post purchase, like all of that good stuff. We're constantly iterating on it. I mean it's so Fun to see, right? Like it used to be me throwing up a quick website against an ad angle and now we've got like a full infrastructure around it still.

[Sam Parr]

That's crazy. That just not seem like a lot of that doesn't seem like a big operation for creating hundreds of millions of dollars of revenue and hundreds of ads.

[Chad]

It doesn't require a lot. And I would tell people that they can do it themselves, right? You create a template and you know, shout out to replau is the platform that I used. And I think you can do hundreds of millions of revenue on replo. I think it's Repp Dot app is the website and it's a Shopify plugin. I mean it's such a good platform. You could just create a template. The only thing you need to swap out is like the headline. Whether it says gut health or it talks about. Pick your other ad theme. Substitute the like little blocks on the page with the new ad copy. It's like, it's not that hard. Like in a day you can create a completely new ad funnel that is going to have incremental performance against a sort of general landing page.

[Sam Parr]

That guy's got to clip that clip and make that mad. Get ready to see your face on a repl ad.

[Chad]

Look, and I have no problem. They don't charge. I mean, I've told them before, they don't charge enough. It's stupid how much value you can get out of that. And I would say this about a lot of our platforms. They're just getting a shout out because it's relevant here.

[Sam Parr]

This is for the folks out there who have a business that does at least $3 million a year in revenue. Because around this point, that's when you're able to look up after being heads down for years building your company and you realize two things. One, you've done something great, but you're still a long way from your final destination. And two, you look around and you realize, I am all alone. I've outrun my peers. Which means you're now making $10 million decisions alone, by yourself. And that is when mediocrity can creep in. My company, Hampton, we solved this problem by giving you a room of vetted peers of other entrepreneurs who are going to hold you accountable, call you out on your nonsense and help show you the way. Because the fact is, is that there's only a tiny number of people in your town who know what you're going through and who have been there and they're hard to find. And if you can find them. It's hard to have this explicit time, this explicit place where you sit down, where the rules are clear that we are here to help each other and to be one another's board of directors. The biggest risk is not failing. You have a company and it's working, you're going to be fine. But the biggest risk is waking up 10 years from now and saying, shit, I barely grew in business and in life. And for people like you who are ambitious, wasted potential and regret is what we want to help you to avoid. We have made so many of these groups and we have a thousand plus members. And I know this stuff actually works, whether you work with Hampton or you get your own group on your own. But having a group like this, a group of people who you meet with in real life once a month, it can change your life. It changed mine and I know it will change yours. So check it out. Joinhampton.com what do you see when you

[Shaun]

look at average marketing versus world class marketing? What do you think? If I'm somebody who's got a brand or a company and I have a landing page, I got ads, I'm doing all the things he said, test creative. I'm testing creative. He said Tesla, I think I'm doing that. What are the most typically missing when you either advise a founder or you go look at somebody else's brand and you're like oh man, they're just not doing this one thing. This, these two things well enough to really jump from average or good.

[Chad]

Great, have a better product is typically what it comes down to which is like so unhelpful because it's like you got to cut your losses. But like a lot of the people who are trying to like find these hacks, they're doing it with like a, a mailed in product. Like something they like didn't. We took a year to develop our product. It's custom blends.

[Sam Parr]

Well how did you know that it worked? Because a lot of times when I take vitamins, I don't necessarily know if it's working. Did you like get your blood tested? A bunch.

[Chad]

This is the beauty of this industry is if you go to PubMed. Are you familiar with PubMed?

[Sam Parr]

It's a public, it's a where studies are right?

[Chad]

Yeah, all the studies are published there. I mean if you put vitamin C in your product and there's thousands of studies about what vitamin C does, sure, maybe I don't know the Precise outcomes of 120 person blind sample survey, placebo, controlled trial, but I can pretty much guess what the outcomes are going to be based on the thousands of other published studies against vitamin C. So to answer your question, Sam, no, prior to launching I hadn't done those tests, but I looked through thousands of articles to land on what I believed the, the right formulation would be for our product. And that's also what I tested with consumers pre launch is what's your perception of this label? What's your perception of this many gummies, the size of gummy, this flavor of gummy, all of that stuff.

[Shaun]

What's on your ideas list but you're not going to actually go do it. So you can, you can riff with us here of brainstorming other brands, other ideas that you think are interesting. May not. May or may not work, but interesting.

[Chad]

Yeah.

[Sam Parr]

And also you mentioned that you have a notion Doc, if you, if you're

[Shaun]

comfortable, if you want to pull up your bank balance, we can also just

[Chad]

do that tell you wiring instructions too on here's what I'll say. One thing that I that I disagree with is people say ideas aren't worth anything. Oh man, do I disagree. I think ideas are worth so much in the right hands and in my hands they're in the right hands. I believe and every founder should believe that about themselves. And so there's certain ideas I can't share because I'm like, guys, like I legit have an idea that years from now, like I've still got a lot I want to do with grooms. Like, like actually there's a lot I want to do with this business. I'm not done here. But like years from now I think there's an idea that no one else is going to be able to run it. There's a $10 billion business idea and

[Shaun]

I'm, you should just say it now

[Sam Parr]

and we'll bleep it out and we

[Shaun]

can totally give us like a code word or something so we can, we can at least give you credit for it years later.

[Sam Parr]

Where the wrong.

[Chad]

When you see it, you'll know. You'll see it and you'll go oh yeah, this is a big business idea. So. And I don't think anybody's going to do that in the meantime, while I'm finishing my chapter here at Gruins and doing what I set out to do.

[Sam Parr]

Okay, well what are some other ideas that if in the right hands are great that aren't your hands.

[Chad]

I had this idea one time. It has nothing to do with consumer and I actually almost ran with it around the time I was starting grins. And I still think it's a good idea, but I'm not going to be the one to do it. So I'm happy to share it. Right now, there is no way to direct the money that you have coming in from, like, direct deposit. So that direct deposit hits your checking account and then we've all got to have the willpower to decide, oh, put 10% in savings and put this against your bills and do this over here, blah, blah, blah. What if you become the. Essentially the distribution layer of ACH transfer. So it hits this distribution layer and before that person has to have the willpower to decide what they're going to do with it. And this is helpful for so many people in their lives, right? It gets wired out to the rent that they have. It gets wired out to their car payment. It gets wired out to blank over here, over here into their investment. And so what actually hits their account that they're spending against is 500 bucks for groceries or whatever it is. And the technology exists to do this. Right. It hasn't been structured. I can't remember what platform allows for it, but there's a platform that can facilitate what I just described to you. So, like, this idea could be done tomorrow.

[Shaun]

That's a great idea, even whether it's for consumer or for businesses. Have you ever read the book Profit First?

[Chad]

No.

[Shaun]

Somebody recommended on the podcast and they go, it was like the time when my girlfriend bought me the book the Game before I went to college and we were going to break up. And I was like, you need to learn how to talk to girls. And I was like, oh, thank you. It was a gift, but it was also a message. And my friend told me about this book, Profit First. I think it was a gift and a message. And the message was, hey, you're running this business and you've been doing it for years, but you're not pulling out any profits and you don't know where all the money's going. It's profitable on paper, but like, you're not getting money out of this. And that's a very common business owner problem. And there's this book called Profit first, which has this philosophy which is basically, you preset the budget. So what most people do is they say, I have this much revenue, then they have all their expenses. And then they. It's kind of like, surprise. Whatever's left over, that's your profit. And you're usually quite disappointed with that surprise. The better way. What this guy advocates for, he's like, you just set A budget for your P and L. You say, oh, I'm going to spend 25% on opex. I'm going to, I need to reserve 20% for taxes. So I'm not stressed out every tax season. So I just want to put that. And you literally just create four separate accounts. You create a tax account, a checking account. So automatically 20% gets go, goes in there and that's waiting for. It's in a, like a money market account until tax season. You have your OPEX account. And so now your team has to run on a budget. It's like this is how much you have to spend. You don't get to just spend whatever and keep eating out of profits. And you set a profit threshold where you say, I want to have 50% profit. So it basically pre allocates to your. As every dollar comes in, 15 cents will go to the profit bucket, 25%, 25 cents will go to the OPEX bucket. And it's actually kind of a life changing idea. It forces discipline. You think you're running pretty lean until you actually have a hard cap on expenses. And then you realize like, oh, actually there was way more fat I could trim. I actually could have been this profitable yesterday. I just, I let it be an output rather than an input. But, but unfortunately there's not an easy way to do this.

[Chad]

A very.

[Shaun]

You have to like set up seven accounts with your bank and then you have to tell your accountant, hey, keep doing these sweeps every two weeks.

[Sam Parr]

Have you guys heard of Simple? Do you guys remember Simple? I loved Simple. It was really cool. I don't, I think it's gone. It got it. It was one of the very first Silicon Valley banking banks. Yeah. Neobanks. And it was, I don't even think Neobank was a envelope system where you

[Chad]

like put digitally money into different envelopes. Yeah.

[Sam Parr]

And like I didn't, I didn't make a lot of money at the time. And I was like, but I want to like fly home to St. Louis to see my family. And so like it's going to take me four months. And so I automatically, when it would come into my bank account, the way it would visualize it, it was still one bank account. It. Well, this is, this is how much is left. You know, you have 350 bucks in your spending account, but you have another 400 in your vacation account. So like don't touch that money. It was pretty cool.

[Chad]

So. So Sam, the Here's what I love about this idea. And Sean, you're bringing up actually Why I think this is even potentially more compelling for businesses because if you're changing the way that the P and L works, I mean, venture capital firms want that because now there's more discipline around the money that they're giving.

[Sam Parr]

Totally.

[Chad]

The small founders who are making 5 million a year who want to pull 500,000 out, they want it because now it's like, oh, well, I'm forcing myself into that discipline to pull 500,000 out every year. It's like, that's a huge use case that I wasn't thinking of in terms of personal. The problem with budgeting today is it's done. I grew up in a family where at the age of six, I was in Quicken and, like, I had to take every receipt, scan it, type it in back in the. You know.

[Sam Parr]

Your mom and dad made you do that?

[Chad]

My dad taught me budgeting. Yeah, I'm.

[Sam Parr]

That's awesome.

[Chad]

And like, like, we were so against debt and everything else, but I like it. So it was awesome until there was an imbalance at the end of the month and I had to go search for the 20 cents that was off.

[Sam Parr]

Is that like a Mormon thing? Because I've. I've. I think I've got a bunch of Mormon buddies who are very disciplined with their monthly budgeting.

[Chad]

Yeah, it might be. Honestly, it might be something that's. I mean, there's a lot of, like, financial discipline in general. But. But to put. Put the headline on it. To me, what I love about this idea is it solves what I think sucked about the granularity of, like, wasting hours a month, a week on, like, typing in all my stuff.

[Shaun]

Right.

[Chad]

And it also solves the other end. Right? Like, people, they get to the end of the month, and it's like, that was actually a hassle to do. Did I change any of my behaviors based on it?

[Sam Parr]

I don't know.

[Chad]

And then the other end of it's like Mint back before that got acquired or whatever. And I think the other one today is Monarch, which I like. Monarch have more money. It's like, it's helpful to see. But, like, Monarch's not really like, a proactive platform. Right. It's like, oh, I'm just like, getting

[Shaun]

about is like, I'll tell you how bad you're doing at it versus, hey, let me just fix it for you. But you wanted to fix it for me. Solution. I really wonder whether, you know, with agents or, you know, you take the popularity of, like, Mercury or the kind of all the popular neobanks that are Pretty product first.

[Chad]

Yeah.

[Shaun]

And they're more programmable. I wonder if either somebody could build it on top of one of those banks or if they'll end up releasing something like this themselves.

[Chad]

I think you get acquired, I think if you run this business, you're going to be acquired for 500 million to a billion in like two years. If you execute this right, like somebody out there listening right now, feel free to send me a dm. When you do it like this, this idea, the infrastructure exists to be able to do this. If you execute it correctly, you are, one, making a massive impact in millions of people's lives. And two, you will have a financial outcome.

[Sam Parr]

What would be cool is if in 12 months we have to say, hey, everyone, we did this podcast with Chad here. Here's what he said. And then we aired this clip that you just said. And then we're like, here's the update. Because this is, this is fantastic. This is really cool. We do this segment all the time. This is, this is a top tier idea.

[Shaun]

You, you have a couple of quotes that you sent us or like, kind of philosophies. We always ask people, what are your, what are the philosophies you live by that you think are not. Not something everybody does or not everybody believes in? You said one of them that I liked. You go, access is everything. And you explained how you didn't have a ton of access early on, but you know, through Summit and Stanford. Like, can you explain your access is everything philosophy?

[Chad]

Yeah, I think access and the privilege of having access in the world is something that, when you don't have it, surround yourself with people who do and do good work for them and you will get access every time. And then when you do have it, like the privilege I now have, I see it as your obligation. My obligation to give that back to others.

[Shaun]

So explain what you mean by access. What's the personal story where this kind of resonates?

[Chad]

Yeah, you know, like, I'm a dude named Chad, I worked in private equity. What you see today would not have existed without people leaning in and giving me access over time incrementally, and me doing good work for them. So, like, if you go back, I mean, I was always curious on this because I think you get asked in those questionnaires, like, are you, are you middle income, high income, low income? And like, I was aware of sort of wealth, but if I looked at sort of the income that my parents had, and I have seven, there's seven of us kids, so six siblings in our income. I Think I was, like, bottom middle class is, like, how it was defined. And I'm not saying that from a standpoint of, like, ashamed. Like, I'm grateful to have lived in this area and seen these people, because I think you can solve a lot by just giving awareness to kids about what's possible. It's like the grasshopper moment. Once they know, it's like, oh, now you can go get it. So I get. I was recruiting for the big three. Consulting, McKinsey, BCG, Bain, through a contact who put me in touch. I didn't get it, but I landed through another mentor, this gig at Lazard. I did really good work. And Lazard's an investment bank, so in New York City, one of the top premier investment banks working on mergers and acquisitions. That mentor, I'm still close to him. I went and visited him, right? So he gave me access. And that access then landed me at Summit Partners. And Summit Partners, I did phenomenal work for them. I deployed. I literally invested, like, 30% of that fund, a $5 billion fund. Like, I invested that. I sourced the deals that made them the money behind that. I did really good work. And there's this moment when I got into Stanford that I was like, oh, man, should I feel bad because I know how this works? Like, I only got in. Like, yeah, I've had a ton of accomplishments. I had 3.95 GPA. I've worked at great places, got this white dude named Chad. Like, should I feel bad about this, that I got into Stanford and what I came to appreciate is, like, no, I shouldn't feel bad knowing that the reason why I got in is because, you know, two people who are very close to the Stanford folks sent a text and a nice letter of recommendation for me. I shouldn't feel bad about that because they're not just doing that, right? They're doing that because I did good work for them. I made their lives easier. I earned their trust. And so maybe I wasn't born into that access where my dad can send a text to Stanford and say, let my son in. But you can earn that by doing good work for the people who do have that access. And they're so eager to help you have that sort of accomplishment. So that's how I think about access. And it's part of when I got asked recently, like, what's your legacy that

[Shaun]

you want to leave on the world?

[Chad]

And I'm like, you know, like, 33 years old. But the way I think about it is, like, I want to give that access that I've sort of like, either been granted or earned over the last many years, and I want to ensure that more people have access to that who spend their lives working with me and putting. Good work, dude.

[Sam Parr]

You're awesome. You are so cool. I think that when I was younger, I met this really successful guy named Scott Belsky, who was the Chief Product Officer of Adobe and an amazing entrepreneur, maybe a billionaire. And he used this word with me that I never heard before, this idea he used. He said, I'm going to invest in you and you need to be a steward of my capital. And I was like, I don't know, what is that word? Steward? I'd never heard of that. It's just like this idea that you need to be the vehicle that protects and passes on, like, a little bit of greatness. That's kind of how I interpreted it. And you are that person. So my friend Austin Reif. Do you know Austin Rief?

[Chad]

He's the one of the Morning brew.

[Sam Parr]

Yeah. So he started and sold the company for hundreds of millions of dollars when he was 30 years old. He was texting me about this new idea that he was working on or brainstorming, and I was like, do you think it's going to be successful? He goes, it can be successful if I want it to be. And I love that because what. You and him both said something very similar. You have this similar mindset. But I find myself being around him and people like you, and it's contagious.

[Shaun]

Yeah.

[Chad]

You know, and I've thought about whether I should be. I've. I've tried to figure out whether my impact on the world is more narrowly focused on the people who spend hours, thousands of hours with me working inside of Grooms, or if I should have more of an impact publicly trying to relay some of this message. It's hard, though, you know, like, to relay all of this, these experiences that I've had in a public forum that allows for millions to learn. But you're totally right, Sam. At the end of the day, why was I able to build what I built? It's because I knew it was possible. Right. Like, I saw it done many, many times by others. And if I ever had a question, I could go ping those people. And so network experiences, awareness of what's possible.

[Shaun]

I think there's a. Maybe a different way to say what you just said. You know, the way you just said it was kind of like, hey, I was pretty fortunate that these things happened and I did my part, but they did their part. This happens A lot with entrepreneurs is we sort of stumble and fumble our way to success. Then afterwards you can actually look back and realize like, oh, there it wasn't complete random, it wasn't complete chance. And in fact, you could recreate the conditions of success more reliably, knowing what I know now. And so I would just point to three words that you just said. The first one is exposure. You really can't imagine what you've never seen. Your brain won't go anywhere if you don't have any exposure to things. I was talking about this with Ben, my business partner, about my kids. I said, my kids have never been exposed to so much in the world, right? Like, we literally keep going to the same resorts. And I was like, they've never seen a third world country. They've never seen this. I, I started bringing them to just do adult stuff with me because I used to do kids stuff with my kids. And now what I realize is let me just bring them along for life. And kids actually love it. They like doing laundry, they like cooking, they work out with me now in the gym every day. They like going with me to meetings. They like, you know, they actually kind of enjoy that because they're getting exposed to new stimulus that they've never really seen before. And even if they're five years old and they can't fully grok it, there's some part of it that just breaks some fence that they had around what the world is and it starts to poke holes and it lets new things in. Growing up, I didn't know any entrepreneurs. I didn't know anyone in my entire family. My mom has nine siblings, my dad has four. Out of all of them, there were zero entrepreneurs. Every single one of them was an engineer. Like typical Indian family. So the highest calling was you get a good job. What's a good job? A six figure job that has health insurance. So that was all I knew. I was all I was exposed to if what was possible. And then my senior year of college, I took a class called Getting Rich. And in the very first class, she brought in a speaker. And it was a girl who started a T shirt company. And then the next class she brought in a guy who started his own hedge fund. And I just thought, I looked at them and I said, why are these guys having all the fun? This sounds awesome, maybe I could do that. Instead, I just finally exposed to the thing, you know, when I was 21 years old and it changed the trajectory of my life. Had I not had the exposure, it literally would have just not happened. And so the first is exposure. How do you get yourself in a position to see new things or help other people see new things? The second is access. And then you, the way I would put it for you is earned access. Because you said something very casual, you're like, I did good work for them. You know what? I bet if we peeled back, there probably is a lot there. I bet you over delivered, I bet you didn't get paid proportional to what you did and you didn't whine about it. These are my guesses. You tell me if that's true or not. But the access is earned through showing that you're somebody who deserves greater opportunities and greater access and you sort of delay the payoff of those actions. And you just have faith that I'm gonna just, I'm gonna kill it right now and I trust that, you know, the ball will bounce my way over time and I don't need to immediately tit for tat measure what, what I'm getting versus what I'm putting in.

[Chad]

Yeah, I think I, I, I think it's true. And frankly I think, you know, I'm young, I'm 33 years old. I think about the impact I want to have on this world. I think it's that first one, exposure. How can I facilitate exposure to everyone, right? Young, young kids, how do they get exposure? That honestly I think that's where my wife and I want to make an impact is making it possible through some, some effort in the next chapter of my life to ensure that the random kid who's 6 years old or 10 years old in a place that would never get exposure to this at least knows what's possible. Because if they know it's possible, maybe they'll go after it themselves over time.

[Sam Parr]

Hey, can I, let me ask you a question that you might not feel comfortable answering. When you're wired hundreds of millions of dollars. What do you, what do you decide to do with it? Where did you invest the money? And that includes like, did you decide to give any away?

[Chad]

Yeah, TBD on it. But I, one of the hardest things I have is I've thought about my, my impact. Like it's the same as I don't even know if I'll invest in other companies. And it's not because I don't believe it's like what's the next best use of a dollar? It's going to, it's going to take a lot to convince me that it's something other than what I can go after and do and that doesn't mean it's always business profit centered. Like I don't always have to make money. Like can I, Sam, go out and make, make an impact on the world by taking my own funds and building like something special out of it? Right. That has an impact on whether it's mentorship, exposure or whatever it is. So tbd. I mean as you know, when you receive money, you spend a lot of time thinking about deploying it. You don't want to rush into anything. But I would expect that the more meaningful deployment of my capital is going to come through some personal effort in my life that I do to make an impact, so.

[Sam Parr]

Well, first of all, can we. Let me ask a boring question. Where do you invest the current money? Where did you invest is just boring index funds, is it?

[Chad]

Well, you know there's a difference between signing and closing. So you have to go through anti regulatory. So we've signed but the closing happens as soon as it's been approved by government.

[Sam Parr]

So you don't have.

[Chad]

The money's not been wired yet.

[Sam Parr]

But I don't know what that. I've not had a deal. That was.

[Shaun]

Yeah, my first acquisition. They just venmoed me.

[Sam Parr]

Yeah, we've not, I'm not, I've not dealt with the, with the Department of Justice. Yeah. So that's pretty cool.

[Shaun]

It's funny, there's a crazy, there's a crazy story. You know the company App Lovin.

[Chad]

Yeah, yeah, yeah.

[Shaun]

My, my co founder was the co founder of Applovin at the time. So he's sitting next to me at the office and they signed this deal and I'm like, oh my God, you just sold. They sold the company for I think 1.2 or $2 billion. I forgot which the, what the number was, but 1 or $2 billion. And I was like, wow, dude, you did it. You sold a company for a billion dollars. Two billion dollars. That's amazing. And I was like, should we go? Dinner's on you. What's up? He's like, dude, we haven't got the money. It's gonna be like months. He's like, if it's over, I forgot what the number is.750 million. A billion dollars, whatever it is like literally like the government, you know, the way he put it was like it's gonna sit on Trump's desk until he stamps it. The crazy thing was they sold to a Chinese company so there was actually a lot of risk. And so he didn't know this at the time. He thought, you know, it's over well, nine months go by, a year almost goes by and the deal is still not approved. But they've been running the company. They've doubled revenue in that year. And so instead of waiting for the approval, what they did was they went and renegotiated. They were like, hey, here's what the 2 billion gets you instead. And now it gets you 25% of the company instead of whatever, 80 500%. So they renegotiate the deal because the business had grown. So it was the best thing that ever happened. And so they took a minority investment, got some liquidity, it kept growing the thing. It's now like it was a hundred billion dollar company in the last last year. Right. So it went 100x since then.

[Sam Parr]

A quick Google. So I haven't had time to read all this. I believe it's $130 million is the threshold where the DOJ has to say 130. You have to notify the DOJ and the FTC anything north of $133.9 million.

[Shaun]

Dear DOJ, I'm rich. What do you notify?

[Chad]

There's like an official form. And then they, they're just reviewing it as they should to make sure that it's not bad for the consumer.

[Shaun]

Dude, that's cool. Well dude, thanks for coming on man. And congrats again on building something pretty epic. I remember when I saw the product, it just seemed like, oh, that's it. And the best products actually are simple like that where the proposition is easy for the customer to understand. It makes sense in the world. It was almost like hidden in plain sight. I feel in a way. And you know, to your credit, you ran with that, you acted on it and you built something pretty incredible.

[Chad]

Of course. Thank you for having me on. My hope is that three years from now we're talking and you guys are like, geez, dude, we didn't realize there was that much ahead of you. We've got so much this team wants to do and so eager to show the consumers what we've got for them. New products, new innovations, new fun limited time offers.

[Shaun]

What's the best thing on that shelf? I should buy.

[Chad]

So have you tried the Olipop? We've got some products here that are launching soon. But have you tried our Olipop?

[Shaun]

That's actually, I've only ever had the original. I didn't even try anything else. I just got the original like subscription. That's it.

[Chad]

So yeah, you, you may know this, but we've got Grooms, which is the comprehensive Nutrition, greens, multivitamin fiber. We've got Nootrops, which is a Nootropics product. We've got Immune, which is like a, almost like an immunity shot, like the two ounce bottles but in gummy form. And then we've got Juiced, which is this one right here, which is like a pre anything energy product. So I mean, we've got like 12 innovations in the pipeline. That's what I'm saying. Like, it's so exciting. We've, we've like done something so big, but like we're like maybe five miles into a marathon.

[Sam Parr]

Good man. Thank you so much for coming on. You have an open invite whenever you want. You're, you're, you're a wonderful guy. We're, we're so happy for your success and it feels, makes us feel good to promote you. So thank you for coming on. That's it. That's the Pod.

[Chad]

I feel like I can rule the world I know I could be what

[Shaun]

I want to I put my all

[Sam Parr]

in it like no days off on a road let's travel never looking back.

[Shaun]

Hey, let's take a quick break to tell you about our sponsor. It is a podcast that we want you to check out. It's called D2C Pod. It's hosted by Ramon Barrios and Blaine Bolas. And this is a podcast about all things direct to consumer D2C. It's E commerce, stores, it's how you optimize your brand. And they're talking with founders, marketers and the platform creators about all kinds of things that you need to know for D2C. You know, website conversion, paid ads, Facebook ads, consumer trends, email marketing. If you want to know the stories behind your favorite brands, this podcast is for you. So check it out. Listen to DTC Pod wherever you get your podcast.