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- [00:00]
Sean Frank
And if you're going to try to measure what's coming next, you have to think about this. There's very, very few megatrends, right? So, like protein, fiber, sleep, like, these are megatrends.
- [00:10]
Matt
To give everybody who's listening some scale. There's roughly 30, 31 million Americans who are on GLP1s right now. So small brands like, let's talk, under $100 million are driving 35% of US food and beverage category growth, but they're only 13% of the market. They seems to me that the play is like, you just need to really be thinking about omnichannel from day one. You can't just start out D2C in these categories.
- [00:33]
Sean Frank
I would always say, and this was my advice for about 10 years, is that you should start as high as possible. Mike Beckham from Swimming Water Bottles and the True Classic guys kind of show that you can make a lot of money on the other end. So I would say pick one of the extremes. Just don't go in the middle. Nobody wants another $50 T shirt. You have to be $500. You have to be $5 foreign.
- [00:57]
Matt
This is sort of a winners and losers episode, and we're going to throw a bunch of stuff at you. I didn't know this, and I don't know, Sean, if you knew this, but protein is the biggest category right now. I think in consumer goods, like, it's eight and a half billion dollars, it's 32 times larger than electrolytes. And I think you've mentioned this, I've seen other people mention this. Like, are we at peak protein or are GLP1s gonna keep it? Sort of the queen of, of CPG, I feel, I think I've made this joke before. I feel like there's a point coming where, like, protein's gonna be in your oxygen. Like, you're just gonna have, like, hook it up to your, your, you know, face mask, and that's how you're gonna get your protein. But there's. I, I would say I think we can all agree that none of this is really short term trends, right? This is like a very large and dramatic rewiring. Might be the biggest one we've ever talked about on this show because all of us are in, like, durables and other categories. And I think where I want to go today, Sean, is if you're for talking to somebody who's like, building a brand today or is in this space, how should they be looking at all of these trends? So we've got a bunch of segments. We're going to walk everybody through them. And I want to start with the actual, like the sort of the, you know, the white elephant in the room, this GLP1 halo effect.
- [02:15]
Sean Frank
Yeah, well, you know, obesity was the greatest scourge of the past 50 years. There was like no bigger cost to human life in America at least than obesity. And we've just cured it. Like, you know, you can, you could be mad all you want, people, like, but, like, the reality is we have cured obesity and it'll be, it'll be totally gone as like a public health crisis in another 50 years, like in two generations. Like, it won't happen anymore. So it's awesome. I'm glad. I'm glad. We totally have cured it. It's going to save a lot of people a lot of heartache and early deaths and diabetes and whatever else, but it is going to cause a bunch of, a bunch of losers, you know, and it's very easy to point out who you think is going to lose. But I actually, I, you know, everyone's like, oh, junk food's going to, to suffer. Like, fast food's going to suffer. Like all of those things, you know, one, one weird thing to think about is better for you might actually be the biggest loser. And let me unpack that. Like, how many people are buying the healthier version of cookies or healthier version of crackers or healthier version of whatever. And what about in a world where you don't have an appetite, there's actually no need to eat the healthier version of that. You're trying to not overeat, basically, right? The local foods, it's also pretty crap.
- [03:32]
Matt
Like, a lot of those better for you alternatives are still crappy. Like, they're still highly processed. There's a lot of, there's just a lot of junk in them. I don't know. Okay, so one of the crazy things when I was looking at this at like the, the topics for today is that people who are on GLP1 spend more on fresh produce. So a 55% increase on going to the produce idle, 32% increase on yogurt and chicken is up 31%. And they've cut sweets by 58%, salty snacks by 44% and sugary drinks by 41%. So to give everybody who's listening some scale, there's I think, a roughly 30, 31 million Americans who are on GLP1s right now. And it's growing. Like it's one of those one chart businesses. Like, it's basically A line straight up into the right. So how is Coca Cola and Pepsi and all these like massive whole. How the hell are they surviving this? Like that is. I, I have to ask. I. Because those are staggering numbers.
- [04:37]
Sean Frank
I think people are addicted to, to Coca Cola. So even if you're on GLP ones, I think people are going to drink Coke Zero, whatever else. But like the lay's portfolio is what I'd be think of as like you know, obviously the biggest losers. It's like if people are eating fresh chicken and salads, they're not eating potato chips. But then there's a whole rash of companies who came out to better for you version of that stuff. And I just think that might get hit doubly hard. You know, think about candy that people like there's a, there's a better for you candy, right? Like they, it ends up swapping sugar. It's lower calorie. Like it has maybe better for your gut. But if Candy is decreasing 60% year year over year or 60% by the end of the decade, I think better for you candy might, might decrease 90% just because who, who's going to be buying better for you candy if no one's buying normal candy? So just something to think about. Those, those smaller adjacent categories might be getting super screwed. But then there's obviously the, the, the big losers. Taco Bell like or whoever else.
- [05:31]
Matt
You know what else I wonder too is do these sort of like sweet treats bad things for you? Do they just get more expensive on a per unit? Like is that how the industry saves itself is like they basically try to move these things up market in pricing because you're like, well now they're not selling as much of them. So you know a Mars bar is now going to cost you $17 because
- [05:54]
Sean Frank
it's a luxury candy goes back to being like a treat. Like ice cream goes back to being a treat. It's like look, if you're on JLP ones you might have a scoop of ice cream but it might just be once a month and not once every, every night. Right? So like I think that's it could, could be a reduction and then in that reduction and increase in the luxury market for sure like more of an experience based snacking. But let's, let's, let's talk about protein because protein has a lot of good things going for it. It is one of the three macronutrients. So carbs, protein, fat, that's it, that's like, that's like what all food is made out of. So it is going to be hard for something to be as big as protein ever is. But at the same point it, we have protein everything. There's protein water companies that I could send them to you, they make unflavored protein that you mix them with your water and it's like at some point it's like people are going to get proteined out. So what, what, what, what's going to replace that?
- [06:51]
Matt
Everywhere we turn right now there is some world changing AI announcement and I think the trick for us operators is figuring out what's actually going to help our business. Is this stuff saving us money? Is it helping us grow revenue? Is it helping us grow profit? Like, where's the freaking roi? Jason for hexclad, tell everybody what is actually working for you guys.
- [07:09]
Jason
Yeah, look, I'm laser like focused on implementing AI wherever we can to just make us more efficient. Fulfill has been huge for us. Like my team is constantly using Fulfill's new CLI tool and MCP features with Claude, they're now able to query Fulfill data. They, they can vi code up dashboards. I mean we get these awesome dashboards on operations and Fulfill continues to build things that are actually useful for brands. It's hard to see what kind of AI work is valuable and what isn't. Sure, like there's so much out there, so much coming at us, but Fulfill seems to be giving us things we can really use to get more efficient.
- [07:51]
Matt
Well, I actually wonder if you get. Have you heard of like the. So I, I see content right this, I'm on a bit of a health kick right now. So like I'm getting my Instagram feed is like tuned to this. But there's a conversation around like the bioavailability of protein. So like how much do you actually absorb when you take it? So like even though there might be a product that claims it's got 40 grams of protein, it's it might actually only have like 22 grams of like bioavailable protein. So I do wonder if we see the protein category for like brand operators. It's like how do you slice up the category? We've seen the obvious thing which is like put protein in everything. Now are we gonna see like further niching down of the protein? So like now I have like a bioavailable positioning of protein, right? Or like a GLP1 specific positioning of protein could be an interesting one.
- [08:39]
Sean Frank
Yeah. And if some like, you know, five years ago, if someone pitched me, hey, we're gonna make protein bubble gum, like I might be interested in that I'd be like, that's awesome. Like I, I protein everything. But now if I'm someone's pitching me to invest in something and their lead pitches were gonna be the protein version of X, I'm probably not interested in that. I just don't think there's enough space to actually stand out. What I'm interested in is like new delivery methods of the same stuff you're already taking. It's like, why did Grun sell for a billion dollars? It's like they really put grummies back on the map. Gummies have already, have always been around. They put them back on the map. I don't know if you know ultra pouches. I know those guys over there. Like, you know, like it or not, 50 million Americans, mostly men, are addicted to Zen right now. So like they are, they are putting Zen in their mouth and. Yeah, at least, at least 50 million. Yeah, dude, you should. If you have, if you ever want to pull up the craziest chart ever. It's like Zinn in the past 20 years in America went from like something only freaks did to now everybody, everybody in Gen Z is doing it. So pouches are going to rise that high. It's like for the first time. And then going back to the glp, one conversation for the first time ever, people are injecting themselves with stuff. Like that was a non, like it was a no go zone for so many people. But now we have 30 million Americans injecting themselves every week. So now they're going to be down to inject more stuff. It's why the, it's why people are excited about the peptide boom. If you have to inject peptides, it's like, okay, well now people are, are okay injecting themselves, so it's not a weird thing anymore. So new delivery methods I'm excited about. And until you start mainlining protein, I just don't know if there's more delivery methods you could do with protein.
- [10:18]
Matt
Right? And it does seem like protein is, is very much a, like the, the big guys do own a significant chunk of share in a lot of the, in, in a lot of protein products. Have you heard of this whole like protein theater theory? It's like that's basically what protein's turned into now is like all content is all performative and that it's actually, there's just like a ton of high sodium like filler and that's what we're sticking protein into, basically.
- [10:44]
Sean Frank
You know, Snickers has a protein bar, so it's like, it's like, if you want to eat a candy bar, they're like, bro, we got 20 grams of protein. And people are buying that, being like, it must be good for me. It has protein. It's like, oh, dude, that's so the shark. The shark has been jumped, bro, on protein.
- [11:01]
Matt
You know, just tying it Back to the GLP1 thing. Do you see people playing the GLP1 angle with their products? So even if it's not, like, related directly to a GLP1, it's like, is it GLP1 adjacent? So I saw an ad from Marsmen about like, their thing and how it, how it should be taken by GLP1 users, right? So, like, they're clearly like, okay, all of you people. Like, there's certain, certain amount of men who are taking GLP1. So they've, they've got like, I was in their ad library the other day. I'm like, there's a bunch of ads here all around, like Marsman and GLP1s. I would have never, like, on the surface put those two together. But it got me thinking. I'm like, well, what else can you sell as a, like, side effect or a positive symptom of somebody being on GLP1s? And should brands be thinking about this? Like, how do I basically create this as a new angle in my ad account or a new funnel?
- [11:53]
Sean Frank
Yeah, if you sell something that goes inside of you, it's like you have to try to ride whatever the wave is. But I've. Okay, so I help a private equity group sometimes, and they sent me over a deal to, to review, and it was a meal replacement shake. And. Yeah, and you know, they were, they were really big in a non American market and they were like, think about how big we can be in America. And my, my whole pushback was, GLP1s are going to totally crush you. And they were like, no, no, no, we're gonna, we'll be taken with GLP1s. It's like, you take your GLP1s, you're not hungry anymore, but you need to get your calories and you take this meal replacement shake. Right? It's basically a Huel competitor or whatever. And I just didn't believe that. I think the biggest loser in the GLP1 experiment is going to be like the weight loss industry. Obviously. It's like people have been selling snake oil in forever and meal replacement checks fall into that. Um, so you know your questions about what positive angles can you take? And right now everybody's taking this works with GLP1s or if you're on GLP ones, you should take this. I don't know how that's going to work with wallets or luggage, but I'll try to, I'll try to think of some ads. But also I think a lot of those people will end up finding out that their, their product becomes obsolete because of the GLP1 craze.
- [13:05]
Matt
Yeah, I mean you made the comment before we record it like the, you know, plus size clothing is another one. Like I would say like all of the products that service, you know, obesity, like any, any industry that was born out of like people are just overweight and unhealthy. All of that's gonna take a punch. I actually wonder like how, how big of a business is diabetes?
- [13:27]
Sean Frank
Dude, I wish I had the same thought. So I'm glad you brought up plus light clothing. This is what I mean by there's third and fourth order effects of GLP1's taken off. It's like they're gonna hurt the weight loss industry for sure. Like if you're trying to sell coaching plans about how to lose weight, you're screwed. But also plus they closing with the fastest growing category for the past 20 years in apparel outside of, you know, athleisure. It's just, it's not going to be around anymore or it's going to be around, but just in way, way smaller quantities. And it totally ties to everything else we're talking about.
- [14:01]
Matt
Oh my God. The size range of clothing companies is about to get tighter.
- [14:05]
Sean Frank
Totally. And yeah, so you, you brought up diabetes. 1 Diabetes is a horrible condition and I'm glad that we have something that can stop type 2 diabetes before it happens because you're already injecting yourself with insulin if you have type 2 diabetes. So it's like, hey, you're pre diabetic. Get on GLP1s or else you're gonna be injecting yourself anyway. Right? So I think that's, that's where a lot of this adoption is coming from. But you think about diabetic socks, bro, diabetic socks is probably like a three billion dollar a year business. Right? And it's going to go down now. It's like there's no, no if ands or buts are out. It could be a billion dollar business. You see a 66% contraction than that just because, you know, people are going to be healthier longer.
- [14:47]
Matt
Call me a nerd if you want, but one of my favorite things is when one of my existing software partners in this Case Northbeam adds something that I would have had to have normally paid more and separately for incrementality was broken and North Beam decided to fix it.
- [15:02]
Jason
Matt, you're not just a nerd, you're also cheap.
- [15:05]
Sean Frank
Yeah.
- [15:05]
Jason
And one of the things my team and I are looking forward to with this is now having MTA and incrementality cleanly tied together. It's really nice having multiple views of a test totally integrated from design to monitoring. We can just focus on the insights and not the logistics. So now your incrementality test results, they just feed right into your North Beam MTA dashboards that we're just used to looking at every day.
- [15:31]
Matt
Yeah, I don't think any of us are going to say no to less work and making life easier for all of our teams. If this is interesting to you, go to NorthBeam IO and ask for a demo. And feel free to tell them that the operator sent you. We're at 30, 30 to 40 million Americans that are on GLP1s right now. Like some or something close to it. I know there's other names for them, but that requires you to inject yourself and all of a sudden it's about to be a pillow. Like it's like any other supplement that you take and that's just gonna reduce the friction. I don't like the idea of sticking a needle in myself. I don't know, maybe I'm weird like that some people are normal, maybe I'm just not normal. But I imagine as the friction goes down or like, maybe it becomes like a pill you take once and it's good all year. Right. Like it's not even something you have all the time.
- [16:18]
Sean Frank
Yeah. You know, hopeful. Hopefully in 10 years. I mean, I think, I think we're gonna be at the stabbing yourself phase for the next probably two to five years. I think orals will slowly come out and then we'll have to test the efficiency of them. But if you want the newer, best one, there's stuff coming out of trial right now that makes. Makes GLP1s look old. Right. So this is, this is the next. It's a trillion dollar wave. Right. It's going to fast food and snacks and plus side clothing and diabetes, but people will probably live longer, so that's something you could like. What are the. What are. Who are going to be the winners? It's like elderly activities. So I would start a company taking old people on walks, to museums. There's going to be more old people walking more. Right. So I was going to go with
- [16:59]
Matt
retirement communities and like that kind of thing. But sure, yeah. Professional walking services for old people.
- [17:05]
Sean Frank
Yeah, yeah.
- [17:06]
Matt
There's a Sean Frank business advice for 2026.
- [17:09]
Sean Frank
Hey, we're just freestyling here. My first podcast back.
- [17:12]
Matt
There's another thought I had around this, which is like, what are. So it's, it's clear to me that the grocery store is totally going to get rebuilt. Like that has to happen, right? So like if all of a sudden 100, 150 million Americans, maybe more, are on some version of these, a peptide, whatever they want to call them, and they're buying 50, 60, 70% more produce, that has to impact how the store is laid out, the supply chain behind that store. It has to. Like, there's just no way that you have like 80% of the store in boxed processed food when nobody's buying. That's just going to be a demand driven change that needs to happen. Maybe grocery stores get smaller. We just might be on a path, a very long, windy path to being just like Europe. It's like everything is small, fruit markets or vegetable stands because that's what we actually need.
- [18:03]
Sean Frank
The other thing, like, let's just. I want to keep thinking about this future where things are different. Low impact sports will get more and more popular. So like, if we have a bunch of people who are currently 30 to 50 pounds overweight and they stop being overweight, they're going to want to do something. But these people aren't going to want to play, you know, intense basketball or something. I think pickleball probably gets even. Yeah, the pickleball was good for old people in the pandemic. And I think it's, I think it's gonna be great for GLP1 people. It's gonna make you feel a little active. You get outside, you sweat. It's competitive. So anyway, more, more winners there, man.
- [18:36]
Matt
Does your current thinking around consumables? Like, I know you guys, Connor was talking about it on the mops. You guys launched Gut Culture, which is a fiber play. Is that tied at all to the GLP1 craze or was that just a whole other trend that you could see that you saw coming?
- [18:55]
Sean Frank
Yeah. Why do we launch Gut Culture? I mean, there's three macronutrients and Pro Protein has been on the biggest tear ever. Right. I don't think we're going to get people to start taking fat. I mean, there's, there's definitely good fats, right? Healthy fats like omega pills, whatever. And then carbs are, have been the Devil for a long time now. Fiber is a carb, but it's an insoluble fiber so your body can't actually process it. So that's why like if you ever look at a nutrition label, they'll actually add it back. But what does fiber help you do? It helps you poop. And what do GLP1s help you do? They, they, they totally mess up your stomach sometimes. So we, we saw it as a, just a trend emerging. Fiber is going to be big. I don't think it's gonna be as big as protein, but it'll be the closest thing that it's. We will have the protein. Everyone's going to need to take more fiber. Colon cancer is on the rise amongst our generation because we eat processed and nobody's pooping enough. So we made gut culture. It's a fiber supplement. We're gonna do more stuff in the fiber space. And the way I'm thinking about stuff is if I'm investing in consumables, you need a new delivery method that solves a classic problem. The problem can't be weight loss because that problem has been fully taken off the board and you have to focus on other areas of health. So skin care is going to be more important. Sleep is going to be more important. Gut health is going to be more important. You know, dental care will be more important. Like anything that has, doesn't have to do with actually losing weight will, will end up absorbing a lot of that. People are still very vain. And anyway we, so we went with fiber first, so. And it's going great.
- [20:28]
Matt
What's your take on this whole looks maxing thing? I've had a few people ask me about this because they know I'm a consumer. Is this a short term, do you think this is like a long term trend on that? Everything you just said makes me of looks maxing. It's like people are inherently vain. Human beings need some kind of way to differentiate, create structure, class hierarchy, like all that stuff. What the hell is this all about?
- [20:51]
Sean Frank
Yeah, look, I'm, I'm the, I'm like the right age and demographic where I've been hearing about this for like eight years, bro. Okay, okay.
- [20:59]
Matt
Like I just heard about it.
- [21:00]
Sean Frank
Okay. Yeah. So like. Yeah, so like do you know like the whole thing about mewing? Like that was an actual doctor who came up with this idea like that though his, his whole thing is that people have under underdeveloped, you know, chins and jawlines. Because we give, that, we give baby soft foods. He's like, you. You actually need to be building up, like, the muscle density and the bone density by, like, chewing hard things and, like, having a pacifier all the time actually makes people have these underdeveloped chins. So he's a doctor. He's dead now. But, like, that was. This whole idea was that you actually needed to strengthen your. Your bones. It's like, by either doing damage to them or rubbing them or whatever and getting, like, a more, you know, full jawline. Anyway, so I heard about that, like, 10 years ago, and now it's like this big thing that everyone's talking about. Looks.
- [21:47]
Matt
Max, is that the little chewy thing? Like, I see the ads sometimes. Like, people chew on this, like, thing, like a muscle.
- [21:53]
Sean Frank
Yeah. So that was.
- [21:54]
Matt
So it's like, to make a more defined jawline.
- [21:56]
Sean Frank
Jaws are part of it. Yeah. So Jaws House is one of our old clients. I think they went out of business. Like, they went bankrupt or whatever. But in my agency days, Jaws has one of our clients. And it's like a thing, like, you chew to make your job better.
- [22:08]
Matt
Are you paying attention to you, or is there ways that you monitor some of these? I guess, like, these larger trends in consumer. Like, I'm just thinking of everybody who's, like, building brands right now. There's just so much data in this space that has. Has me thinking, like, there's just so many brands to build. Like, it goes back to the whole, like, why are we bullish on consumer. It's just so much is changing right now. How do you actually track some of this stuff? Or do you. Or do you just, like, it just comes up through how you consume content online. Like, I'm just so curious.
- [22:42]
Sean Frank
Like, we. I said this in maybe a podcast 100 episodes ago. It's like, if you want to know what's coming, go to Erwan. It's like, you know, and maybe Irwan's too. Too mainstream now. But, like, you go to a health food store and you see what, like, hippies are talking about. Like, hippies were on kombucha. The. The founders of Ridge, Daniel and his dad. So Paul Kane is a massive hippie, and he, like, went to India in, like, the 70s, and, like, it was a Buddhist, like, the whole thing. So he, like, he used to make Daniel, when Daniel was 8 years old, drink Kombucha, and they called the heebie jeebies. It was just this gross jar that, like, they would cultivate. But, like, that. That ended up being. Right. That ended up being this, this. This Megatrend. So there's always people on the front line and if you're going to try to measure what's coming next, you have to think about this. There's very, very few mega trends, right? So like protein, fiber, like sleep, like these are mega trends people are going to care about. And then there's, there's a lot more ingredient trends, but not very many. Creatine's an ingredient trend, right? Like people have taken creatine for 25 years, they're going to take it for another 25 years. Its rate of, you know, penetration throughout a society will go up and down slowly over time. But like I think what you need to look at is like what are the macro trends? You only have to get a couple of them right and then what are the ingredient trends? What's coming? Like I publicly say that I think colostrum is going to be a trend. People are already taking it.
- [24:04]
Matt
Oh, it's going to be massive. Yep.
- [24:06]
Sean Frank
There's, there's huge companies being built in colostrum right now. Some people tell me that it's, it's already over and like, you know, the winners have already been made. I don't know
- [24:15]
Jason
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- [25:00]
Matt
I don't know if I ever buy into this whole like the winners have been selected thing because there's just like there's no monopolies in consumer, right. It's just cycles. So like you could be a like many, many years ago a friend of mine, Charles, sold his protein company Vega for like 600 change million dollars. And I remember people saying that's it. That' vegan protein, that's it. There's the winner. You know, there's no more protein powder companies. And I'm like every three years my wife brings home some new protein powder that has some new way of being better than the old protein powders and that. It just seems like this is the cycle in consumer. Like, there are no monopolies in consumer in any category.
- [25:39]
Sean Frank
The thing is, tastes change. Like, it's. It's not. You don't get lock in. People want new brands, People want to try new things. Um, you know, someone pitched me human colostrum. They were like, yeah, we actually. We found a way to actually, like, biodevelop the equivalent of human breast milk. And we're trying to sell it to people. I didn't invest in it, but I'm like, that's a crazy idea. So there's a lot. There's a lot of. There's always going to be new innovation and new stuff to try. You know, people are pitching Kalo really hard right now as like skincare and cream. Right? And it's one of those things where I'm like, I just think the branding needs to be totally right. I don't think people want to rub, you know, beef. Beef parts on their face.
- [26:16]
Matt
Dude, do you want to talk about the hippie thing? That has been. This is. That's a world I know because my wife is kind of. She's like, very much one of those people that is super early to all this weird that's been like, I don't know, five to 10 years, like, tallow face cream and tallow deodorant. Like, we brought this home a decade ago. It is weird. It's a hard sell. Like, it feels super strange, like, just mentally that. That you're right. That's a branding thing. Absolutely. A total side note, dude. Okay, last week I was at a ECF camp, which is like their, you know, Andrew's sort of smaller event for larger brands. And I met two brothers that sell freaking caskets online. Like, I'm like, they're. You're.
- [26:59]
Sean Frank
So you have a.
- [27:00]
Matt
An E Commerce casket business, like, for people who are dead. They're like, yeah, and they're young guys. They're like, I'm like talking to you like, you're big enough to be at this event. I'm like, tell me more, man. Like, how do you sell a casket on the Internet? So everything is doable. I'm no longer shocked at any category in any play.
- [27:22]
Sean Frank
Yeah, dude, totally. So, look, there's always going to be macro trends. There's always going to be ingredients. Like, you know, weight loss is. You can't even call it a trend, but it was. It was the biggest possible category that you could make money in for the past 30 or 50 years. I mean, Herbalife. Every. Everybody wanted to lose weight. And now the pharmaceutical companies developed an actual perfect cure for being fat and they've released it on everybody. And now it's like, okay, that money will flow somewhere. People will always want self improvement. So it's going to go to skin care, it's going to go to sleep, it's going to go to. Maybe people get really into bodybuilding and protein actually stays. Stays hot for a long time. I don't really know where it's going to go. If I. If I could, I wouldn't be doing this podcast. But you just want to. You want to have some bets in the game. You want to pick something and try it? Do you.
- [28:08]
Matt
This is like a total. I wonder. This is like the conspiracy theory in me. If you're a pharmaceutical company and you've developed, you know, Ozempic or one of these, like, peptides, you've got to be asking the question about, like, what does this do to every other drug that we sell? Because, like, obesity being the kind of the lead domino in a lot of illness, you get rid of it, you get rid of a lot of other, you know, and these guys own the diabetes drugs, like they own all this other stuff. So in some way they're shooting themselves in the foot.
- [28:41]
Sean Frank
Yeah, but I guess, you know, the beauty is everyone will be on it forever. Your. Your tam. Your tam gets really big and you can't stop taking it. So I think, I think that's. That's why they're replacing it.
- [28:51]
Matt
Wait, why, why can't you stop taking it? What's the. What's. Is that just because, like, you immediately go back to being hungry and you want to eat everything? Like, is the snapback real? Is that a documented thing?
- [29:01]
Sean Frank
Yeah, yeah. It's not. It's not a permanent change to your body. It's introducing exogenous peptides. I mean, that's what it is. Like, that's what GLP1s are. They're exogenous peptides that your body doesn't produce currently or produces limited amounts, and you're. You're flooding it with way more of it. It's. I mean, if you stop taking it, you go back to who you were before. So you have to take it for
- [29:24]
Matt
the rest of your life, dude, you know? Okay, so like, talk about winners and losers. Another one that I've been thinking about is anything related to like intimacy and sex. Apparently these things can like really drop your desire drive. So like, if you're in business and anywhere in there. Like that's going to be a downstream effect. It at least it seems that way. Not that we needed more help lowering our birth rates. That's probably a separate issue, but that seems to be another one. That's that there's going to be impact there. And alcohol, huge one. People are drinking less when they're on these things.
- [29:58]
Sean Frank
Yeah. There's a chart Mike always brings up that, you know, it's nine out of ten beers are drinking by like 5% of the population. It's like there's like the alcoholic trend is real. There's like a small number of people who drink all the beers. It's the same thing with fast food. It's like, you know, typically after a concert, me and my wife get Taco Bell. That's like a nice little treat for us. Right? So I might have Taco Bell four to eight times a year or something like that. But like, I'm always looking forward to getting some Taco Bell. Do you have Taco Bell every day? Dude, there's people, people I know who have Taco Bell every single day. So yeah, Small number of consumers actually eat, you know, most of the junk food and if you remove them from the pool, it doesn't hurt profits 10 or 20, it might hurt profits 80%. And that could be coming for all the fast food companies.
- [30:42]
Matt
Okay. So speaking of like this sort of small number, big impact thing, one thing I, I dug up was that in this world now, like the. I don't know what to call this, like, it's not just consumer goods. It's like we're talking health and wellness, food supplements, everything but or so I guess, like, let's just wrap it all up in CPG. So E commerce is only like 12% of CPG dollars, but it drives 71% of all CPG growth is what the headline number is from the last year. And it seems to me that we're having a moment right now, right? Like we did a couple episodes ago, we talked about all the M and A activity and the investment activity in consumables specifically. Not just broad consumer. What is your view of like E commerce now as the, the sort of the growth engine for, for cpg? Because I think that's actually new for me. It was like everything happens at retail. That's the playbook I've known for 20 years now. It seems that like all of the winners are E Commerce first, DTC first. Is this a sustained trend? Do we like. I'm just thinking of now like looping in what's going on with social and AI and all this stuff like, or do we think it all flips back to most of this stuff gets bought and discovered in store and that's still where you need to focus. I'm just talking all the operators out there.
- [32:07]
Sean Frank
Right. Well, I'm going into major market retailers right now. So the Ridge is going through a big rollout and they buy a minimum of 12 months in advance. Okay. And if you're a Unilever or a PNG or a Coca Cola, your product cycles are probably, they used to be three years. You've probably gotten them down to two years, maybe 18 months or whatever. If you want a new flavor, new style, new color, whatever, like it's, it's still going to be slow and the world is changing faster than that. Right. So like there, that means the opportunity is on.com because the new thing will happen on.com first. It'll get adoption first. You can build a business because you'll just be ahead before Target can even buy to set the store. Right. So that is, that is post Covid. The pace of change has really, really picked up. You know, grooms in three years got to $300 million like as a public number. Right. And in three years, like they were only able to be sold into Target the last year of that. Because you're starting up, you're figuring out your business and you have a year of explosive growth and then Targets talking to you about placing for the following year. So the opportunity is in, is in dot com. Just because we can move so much faster. And you can, you can, there's big sleeping giants. You can kind of catch them off, off, off their footing. So that's, that's why I think it's happened on dot com.
- [33:29]
Matt
I will say I'll give people a tip right now listening. Target is for whatever reason moving quite quickly at the moment with bringing in new brands into store. I've had three people I know that all are getting into Target in like under six months start to finish, which is just unheard of. Like 12 to 18 months minimum. To go into a Target was like usually the cycle and I'm starting to see it and it seems like Target specifically is trying their very best right now to pull in sort of like hot direct to consumer brands. I don't, I'm sure there's a lot of reasons for that, but I figure it's worth saying yeah.
- [34:10]
Sean Frank
And they've, they've been courting DTC brands better than, you know, the other mass market ones for sure. Um, but look. And maybe they don't like me enough, but in my experience, it's still been about 12 months to. From. From talking to PR, but I'm excited for it to get done.
- [34:26]
Matt
Okay, so here's another stat for you that I think accentuates the point you're making around, like, dtc. First, smaller might be better. So small brands, like, let's talk, under $100 million, are driving 35% of US food and beverage category growth, but they're only 13% of the market. So what you're saying is true. Like, it's showing up in the data now that new young brands are the ones who are basically driving all of the change in the category and all of the growth in the category. It seems to me then the play is like, you just need to really be thinking about Omnichannel from day one. Like, this is a Mike Beckham thing. Just how are you going to exist across these channels? Like, that's not an. An afterthought anymore. You can't just start out D2C in these categories.
- [35:14]
Sean Frank
Yeah. And if you want to get bought by a strategic, you have to be a real threat to taking their shelf space. Like, you know, I think why Unilever moved so fast to buy Groons and why they bought Dr. Squatch is that they saw Dr. Squatch taking over the shampoo aisle, taking over the. The deodorant aisle, and they're like, it's just, we can't afford to lose it for a billion dollars. We secure that we actually own the shelf space for another four years, and that's just so worth them doing okay.
- [35:42]
Matt
So, like, in GLP ones, I guess hims and hers is the. The brand that I think of the most, like, in the D2C world, it's like, that's who I think is playing. That's like your, you know, flashy brand. Is this space going to mature where you're going to get, like, the Warby Parker of. Of like. Of like Gut health or like GLP1 support? Does that happen as this matures?
- [36:04]
Sean Frank
You know, the thing that I'd be more worried about is that, you know, Eli Direct is like, they, like, they just started selling directly to consumers right now. It's still gated, so you need a prescription. So you have to have some sort of teledoctor system set up, and you have to, you know, be HIPAA compliant, all that type of stuff. So the incumbents there do have a big advantage. But instead of the, you know, the designer. Well, I don't know, I, I guess I could see very high end, right? So like, like, if you have the concierge doctor, they're gonna make extremely personal recommendations to you and check in and, and you know, there's a, there's this big movement right now in like longevity. I talked about another megatrend, right? Longevity is gonna be big, but like people doing MRIs, weekly blood tests, maybe not weekly, but at least monthly blood tests, like getting all like a custom stack built to you with a doctor. And it's incredibly expensive to do that, but over time it'll be less and less expensive. And we're already seeing services like, you know, things called lifetime or whatever, like ripping, doing $500 million or whatever in like two years.
- [37:07]
Matt
Have you ever put any. Thought I'd not. This is just a random thing, but have you ever put any thought like, why is it that everything seems to go to the polls like the super high end or the like commodity, you know, doesn't matter what the brand is, like what, what is the driving force there? Because it, it, it seems like everything is touched by this, no matter what. It's like the middle just gets hollowed out. You have no, like, you know, I won't call it like a premium. It's just like luxury or commodity.
- [37:35]
Sean Frank
Yeah. Well, I just, I just had a great post go viral on T shirts over on x.com, so I have so many opinions.
- [37:43]
Matt
Go ahead.
- [37:43]
Sean Frank
But look, so we know true classic and they're killing it, right? Couple hundred million dollars loan to the market. And then at the high end of the market you have, you know, I guess at Tom Ford, Bruno Cocelli, like Laura Piano, like the shirts there that it doesn't make sense to buy them. You know what I mean? It's like 500 plus. That's the entry price. And then in the middle you just have 50 plus brand, 100 plus brands, 300 brands or whatever, right? And brands I love, I love Buck Mason. You know, I put James Purse in there, I put cuts in there like Huckberry, all these great brands that I love, but you end up getting just like a very, a lot of sameness in there. They're all going to make a white T shirt. It's all going to be 40 to 60 bucks or whatever. And the reason why I think it goes to these, both these polls is either you become aspirational, right? Or you become mass market. And it's very hard to do. What Buck Mason does is be aspirational at a $50 price point or whatever, whatever, right? Like, people either want the very best of the best, they want to drive Rolls Royces, or they're going to buy Toyota Priuses and Model Threes. Right? It's very hard. I mean, and that's why I would argue that Cadillac has lost its brand position. It's like Porsche, Porsche is losing its brand position. It's like, people, if you want the highest end, you're going to buy the. You're going to aspire to drive a Koenigsegg, a name that nobody knew five years ago. Now kids are like, it's not a Koenigsegg. It's like kids on Instagram know what the hell that is. So it's like this, this bifurcation of, like, you. They go extremely mass market. Tesla just got rid of the Model X and the Model S for that reason. They're like, yeah, people just want the three. So we're just gonna make threes for $25,000. And that's, that's what the future looks like. Implementing AI without trusted data is shooting in the dark and building application from scratch. Dealing with tableau, dealing with data pipelines, dealing with all that, it doesn't have to be your headache. You can hire Saras analytics to handle that stuff for you. Sarah's IQ gives your leadership team a single shared view of the truth. Contribution, margin, channel, performance, customer economics, all can be answered instantly with the power of Saris Analytics. Do not fall behind. Saris analytics is experts. They've set it up for Ridge, hexcloud and hundreds of other brands. Speak to them today. Connect whatever AI tool you already use and you can put that right on top of your personal data privately, securely, and you can start talking to your data like your favorite chatbot.
- [40:05]
Matt
Is that driven by, you think, like desire, or is it driven by income in quality, like other things that are, I guess, like more like less choice?
- [40:16]
Sean Frank
Well, I think it's, I think it's. Humans always want what's scarce. And this POS pod really go going all over the place. Welcome back, guys.
- [40:24]
Matt
So I think it's all going to tie together. Don't worry.
- [40:27]
Sean Frank
Humans want what is, what is scarce. And the flip side is for businesses to make money, they need high throughput. Another post I just did is that like the Model X only sold like 15,000 cars a year. Maybe, maybe it's 25,000. But like you, you don't make money doing that. They sold 4 million Model Ys, so it's like, it's like the, the throughput is just so important. And that's why hanes the more $9t shirts they make, the more $8t shirts they can make. And then they make and they sell $7 T shirts and $6 T shirts because they just end up getting this huge the factory lines from 247 at the highest efficiency possible. And that's what it takes, right? Just this throughput and then it's good enough so people buy it.
- [41:07]
Matt
Okay, so then the reason I'm asking all this is just to bring it back to the whole like health, wellness, CPG space. This is something I've been thinking about is, is if you're building a brand right now in this space, a supplement brand, a food, a beverage, like any of those things, one of the powders, do you start high end or do you start low end?
- [41:26]
Sean Frank
I would always say, and this was my advice for about 10 years, is that you should start as high as possible, right? Is that like, you know, there's margin in luxury, it's easier to find one buyer than 10,000 buyers. But I think Mike and Mike Beckham from Civil Motor Water Bottles and the true classic guys kind of show that you can make a lot of money on the other end. So I would say pick one of the extremes, just don't go in the middle. Nobody, Nobody wants another $50 t shirt. Like the $50 t shirt has been, has been one. There's too many good options. You can't stand out a $50 T shirt. You have to be $500. You have to be $5. Yeah.
- [42:05]
Matt
And it seems to me that the, at least in the, the I know a guy who, his entire business is he, he makes products for Costco, right? So he doesn't hear the brand Costco basically like I, we need this food product made and this is the guy that makes it. And another guy does the same thing with Walmart. Like there's, there is a business to be made or built just in servicing these large mass market. We want a low end version of whatever else is out there. But it does seem to me that all of the new entrants in these like big macro trends or even, even I love the framing around like an ingredient trend, they all seem to start higher end. And maybe that's just because it's easier to go down in price over time than it is to go up.
- [42:50]
Sean Frank
Yeah, totally, totally. Dude. Why is that? It's because the cost of shipping stuff is going up over time because of fuel charges and inflation and whatever else. And you need to be able to have enough of an AOV for paid social to work and you need a high enough AOV that you can make an intro offer work. Right. You know another brand, I love that I'm close with instant hydration. It's like their intro offer is you get a ton of great value, but it bills two separate subscriptions at 50 bucks a month each. So it's like you end up getting a lot of, a lot of cross and double billing going on. But you need it, you need enough of that margin to actually get people in the door. Right. I think gut culture, if you buy one bag it's 70 bucks and if you get on a subscription it's 30. 30 bucks. So it's like we have a lot more people sign up for the subscription.
- [43:35]
Matt
Yeah, you incentivize the subscription is. Might be a bit early for you in this brand. But like have you noticed the. It's like it is a habitual product. It's like people actually use it as a, it's like a habit forming. I take it on the cadence that I'm supposed to take it. It's hard to tell.
- [43:51]
Sean Frank
No, I mean it's a good question. You know, I think where we messed up is that it's an electrolyte plus fiber product and you, most people don't even take that every single day. So like, you know, we sell 28 packs because it's supposed to be basically every day and it's, it's more or less people taking like three to four a week. Week. So the next product we're going to do, we're going to try to solve that where it's going to be more of like, you know, we're going to sell month supplies that are maybe 20 days or whatever. You, you take this when you feel like you need it. It's not like a groo where you
- [44:19]
Matt
take it every day which would then would affect the overall pricing and math of a product like that because it is not a daily consumable. Right. It's, it's less frequent. So like you're going to have to price it differently. My buddy Dan, I don't know if you follow him on, on Twitter. I still call it Twitter dude. I don't know if I'm ever gonna change. This is just an age thing. Dan Go. So his, his Handles Fit founder, he talked about, he talked about psyllium husk in the past week and like 1.4 million freaking views on this post. He just did like a, a 28 day psyllium husk experiment taking two tablespoons, three times a day.
- [44:58]
Sean Frank
And he.
- [44:59]
Matt
And he documented out what it did to him.
- [45:02]
Sean Frank
Yeah, the thing, thing about fibers, you have to drink a lot of water to balance it out. That's. That's why we went with electrolytes. But look, I think maybe this is the hook of the show, everybody. It is the greatest time to be building brands and making money. There is more winners and more losers than ever before. And we're going to get into them right now. I just think, I just think there's so many. There's so many great winners that are going to be built. Like every new ingredient, every new opportunity. But what I would focus on is weight loss is dead as a category. I don't think there's gonna. There's no more juice there. Right. So it's like you then need to go into muscle building, you know, skin, sleep. I mean, the other thing is like, like, you know, brain health is gonna be a huge one hearing.
- [45:42]
Matt
I was about to say anxiety, depression, like all the mental health stuff. Any angle there is gonna crush dude with food, with supplements. Like, that's another one. Chart business. Just put in Google trends. Anxiety, like, there's your brand. Yeah, totally there.
- [46:00]
Sean Frank
Yeah.
- [46:00]
Matt
I wanted to say, like, if you weren't building in fiber, is there another one that you want to leave people with that you're like, this is something else I think is worth paying attention to. Like, so you said colostrum. These all seem like more ingredient or like more very like specific problem solution areas.
- [46:18]
Sean Frank
I mean, look, I think of a lot of ideas. Hair loss is another one. Male pattern balding. Like, okay, so we started talking about the looks maxing trend. Matt, do you know what Norwood is?
- [46:33]
Matt
No.
- [46:34]
Sean Frank
Okay, so it's a chart.
- [46:37]
Matt
I'm gonna Google this.
- [46:38]
Sean Frank
Yeah. So it's a chart for how bald you are. Okay, so this is awesome. Yeah, yeah, we should, we should post this. But so like, this is great. So like that's, that's now part of the lexicon is like people, people being like, I'm a Norwood 4. People. People know what that means now people know that. Yeah, totally. I mean, our Gen Z listeners are, are gonna know exactly what the hell I'm talking about. But like big, like say calling someone like a Norwood 4 nor 5, it's like, you're hopeless. It's like you got nothing going on.
- [47:14]
Matt
Longevity, something I'm into, I saw, I think his name is Dr. Sinclair. He's like one of those like leading longevity experts. He's been on a bunch of pods, but he's been gone For a while. And he recently came back and he was talking about what they're doing and he's got like a. I think they're gene therapies is what he does. And he was, he made this comment that he gave a talk at one of these conferences. They talked about all of the things that he was able to do with these like reducing the age of things. He's talking about the eyes, the ears, like your cells. He got a fucking standing ovation when he said I can reverse male pattern bond this. He's like, it's the only thing anybody cared about. It's like round of applause for the man at the top.
- [47:56]
Sean Frank
Sinclair has been an OG at the space, I mean doing stuff on mice. So like longevity will end up being the biggest super trend of them all. People do not want to die. So like that is going to be a great place to, to try to build. It's going to be harder. All of these are just going to get harder over time. It used to be just be throw protein in cookies and you call it a day. And now it's like we have to figure out the ingredients that help you live longer and like gene therapies and stuff like that. But yeah, going back to male pattern baldness I would. There's a bunch of money and great companies to be built doing a full scale thing to help guys grow their hair. Not like another looks Maxim quote, hair is life. Without hair there's no life. I don't know if you've heard that.
- [48:41]
Matt
I didn't realize I'd be learning so much today from, from the younger generation. This is. Thanks for making me feel old, dude. Okay, so this is kind of where I wanted to go with this whole show is just there, there. It does seem like this is one of the greatest times ever to be building a consumer. Like not only is it getting easier to start, but then there's just all of these large net new trends, you know, like the fact that weight loss could go away hurts my head because as long as I've been in the the Internet game, weight loss was like the best business to be in. It was like top three easy. You sell anything in weight loss and just crush info products. Didn't matter what it was, people would buy it. And now we're getting a whole new wave of things. Like the longevity that, that category, that's a mega, mega, mega trend. There is so much to do there and there's science every day. Like one of the things I've set up is a, is a weekly like it's like a Claude cowork research job that just goes out and finds me all the latest stuff that's happening in longevity purely from a, like, I want to know what's going on in ingredients and, and just like product opportunities. As a builder growth hack used to
- [49:49]
Sean Frank
be finding the fastest growing subreddits. And like, I don't, I don't know if Reddit's a good place to go anymore just because so much of the discourse has moved to Instagram and Twitter and wherever else, like places that are, that are harder to index. But it used to be like, you'd go on there and be like, hey, like that's, that, that's where you can spot new growing opportunities. Is like, what's the fastest growing subreddits? But you know, speaking of weight loss going away, people are going to lose a bunch of weight. There's gonna be a bunch of skin leftover. Like there's gonna be flabby skin. And that's another great opportunity, guys. There's gonna be, someone's gonna make great products to help with this, great exercises, workouts, whatever. We're all, we're all gonna be a little, a little flabby, a little less fat and people are gonna make great products for it. So the future looks good, dude, I love it.
- [50:34]
Matt
I think this is just, I wanna end it here because I think there's, it's so clear that there's like just a ton of categories. And I mean, okay, I don't know about you, but I get a handful of questions on the regular. One of them is like, what category should I expand my brand into? Or if I was going to build another brand because it's so easy now everybody wants to have a holding company. What should you build? Like, it's always this, entrepreneurs have this like default exploration mechanism where they always want to go scratch around like what's new? And this bucket of things is like health and wellness. I don't know what else to call it. Like just wellness seems to be the best place right now. Like they're consumable largely and the, the trend lines are freaking insane.
- [51:17]
Sean Frank
And removing people being fat will remove fatigue and chronic pain. And it's going to open up like here's top to bottom things to think about. Skin care, longevity, dental health, eye health, ear health, things that you can't really repair easily, right? Then it's going to be, you know, overall body image. Once you do lose the fat, then it's going to be mental health, anxiety, like cold plunges, saunas all that stuff's gonna be great. You could also then get into whatever. I mean, I think gut health is gonna be huge. I'm doing stuff in fiber. People are gonna have tummy issues because they're gonna be injecting themselves with a bunch of stuff. Then also, what are people also addicted to? People are taking Zinn all the time. I think pouches are gonna be big pushes in coffee people try to look at coffee alternatives. We've had the mushroom coffee wave for a really long time. These are like 10 or 20 great things you could be thinking about and building in. And then the last point is there's gonna be a bunch of people trying to build and stuff. It might be a great time to be selling shovels. So start a CO man started to start an ingredient packer. You know what I mean? It's like you, you can just sit, be the number one creatine guy on the east coast. Be like, hey, if you need creatine, whatever, I'll make it for you. Like there's just a bunch of little opportunities here for you to move as an operator listening to the operators podcast to move up the stack and serve other operators move down the stack and serve customers on these new verticals. So best time to be building ever, man.
- [52:37]
Matt
That's a great advice. Let's send it there.
- [52:38]
Sean Frank
Man.
- [52:39]
Matt
This has been good, dude. You gave me a ton of to think about. I think the people listening are going to like this one dude.
- [52:44]
Sean Frank
And Matt learned about Norwood, guys. So look at this.
- [52:46]
Matt
I, I just learned about norwood. As a 45 year old man who's losing his hair, I didn't understand that there was a name for it.
- [52:54]
Sean Frank
I'm probably, I'm probably Norwood. 1.1.2, 1.5 May maybe a 2. But I'll tell you young and you
- [53:01]
Matt
just had your first kid. Let that little buggers just age you a little bit. You let me know how you do over the next 10 years.
- [53:07]
Sean Frank
Oh, dude. And I look, I've been in the community, bro. I've been taking finasteride for five years. Ten years, man.
- [53:11]
Matt
Oh, there we go. Oh, there you go. You're. You're an early adopter, okay.