554: How She Made 10M at 27 Years Old Selling Skincare | Rachael Wilde

Summary

Summary of Episode 554: How She Made $10M at 27 Years Old Selling Skincare | Rachael Wilde

In Episode 554 of The Foundr Podcast with Nathan Chan, host Nathan Chan engages in an in-depth conversation with Rachael Wilde, the dynamic founder of TBH Skincare. Released on March 7, 2025, this episode delves into Rachael's entrepreneurial journey, uncovering the strategies, challenges, and triumphs that propelled her skincare brand to remarkable success at the young age of 27.

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1. Introduction to Rachael Wilde and TBH Skincare

Rachael Wilde joins Nathan Chan in the studio to share the inception and growth of TBH Skincare. Unlike many entrepreneurs who start businesses as side hustles, Rachael emphasizes that TBH was always intended to be a full-fledged venture.

Rachael Wilde [01:04]: "I wasn't someone that ever had an aspiration to start a business. Wasn't really something that was ever playing on my mind."

Her passion for marketing and a serendipitous discovery in the medical devices industry laid the foundation for TBH Skincare, leveraging cutting-edge technology to address common skincare issues like acne.

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2. From Corporate to Creation: The Birth of TBH Skincare

After completing a marketing degree, Rachael ventured into a corporate role in the medical devices sector, where she gained invaluable commercial experience. It was here that she encountered a patented technology capable of breaking down biofilm in the body, initially intended for healthcare applications but identified by Rachael as a potential game-changer for acne treatment.

Rachael Wilde [03:31]: "I came across a technology that ended up being the whole thing that started TBH skincare."

Driven by her personal struggles with acne, Rachael envisioned a consumer-focused application of the technology, diverging from the industry's norm of professional-led branding. This vision led to a collaborative decision with her mother to embark on the entrepreneurial journey together.

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3. Launching Amidst Uncertainty: The Early Days

In late 2019, following securing licensing rights and raising approximately $250,000 through family, friends, and a bank loan, Rachael and her mother launched TBH Skincare on March 18, 2020, just as the COVID-19 pandemic was unfolding. The launch was swift, capitalizing on ready-to-market products that included a gentle cleanser and a cleansing device.

Rachael Wilde [10:34]: "It wasn't a side hustle ever for us. We just got the licensing rights to this cutting-edge tech in a huge category."

Despite the uncertainties brought by the pandemic, the online-centric launch strategy proved fortuitous as consumer behavior shifted towards e-commerce.

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4. Navigating Through COVID-19 and Initial Success

Rachael recounts the emotional and financial strains during the early months, especially as COVID-19 introduced unprecedented challenges. Nonetheless, the launch day saw impressive sales, partly buoyed by supportive family and friends.

Rachael Wilde [16:00]: "We did four grand worth of sales in our first day. Which was amazing."

The strategic focus on building an engaged online community through Instagram and distributing samples to garner testimonials set the stage for organic growth, initially generating a waitlist of around 800 eager customers.

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5. The Power of Content: Leveraging Social Media

TBH Skincare's growth was significantly fueled by Rachael's adept use of social media platforms, particularly Instagram and later TikTok. Her extroverted nature and genuine passion for connecting with people translated into authentic content that resonated with the target audience.

Rachael Wilde [23:40]: "Good content often comes down to, like, how it's put together and how you get that, like, draw in from, from the customer group."

A pivotal moment occurred in 2022 when a spontaneous TikTok video featuring a blind reaction to a radio segment mentioning TBH Skincare went viral, skyrocketing sales and establishing a broader customer base.

Rachael Wilde [31:16]: "I woke up in the morning and I was like, what are all these orders? Like, yeah, I'm like, what is... Like, something's happened with the TikTok video."

This viral success underscored the importance of content in driving both organic engagement and effective advertising campaigns.

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6. Scaling Up: Challenges and Strategic Growth

As TBH Skincare's revenue approached $650K, Rachael faced the daunting task of scaling operations while maintaining profitability. The meticulous analysis of e-commerce metrics, led by her mother, guided strategic decisions to reach a critical mass necessary for sustainable growth.

However, scaling also brought significant stress, including cash flow management and operational bottlenecks. Rachael candidly shares moments of financial anxiety and the personal guarantees made to secure loans to keep the business afloat.

Rachael Wilde [43:29]: "We're going to personally guarantee that loan. We're going to lose all our friends' money. We're going to lose all our money."

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7. Merger and Expansion: Joining Forces with Boost Lab

In August 2022, seeking to inject capital and expertise, Rachael initiated discussions with Boost Lab, a skincare company backed by private equity with complementary strengths in retail and e-commerce. This strategic merger, completed in March 2023, allowed TBH Skincare to leverage Boost Lab's infrastructure and retail relationships, notably securing a partnership with Priceline.

Rachael Wilde [49:35]: "We saw we could leverage each other. They didn't have brand sort of building internally in the company. They didn't have like E-commerce skill sets, they didn't have finance."

The merger facilitated a significant revenue boost, with TBH Skincare alone reaching $10 million and the combined entity achieving $22 million in FY24.

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8. Building a Content-Led Team and Future Growth

Rachael emphasizes that content remains the cornerstone of TBH Skincare's strategy. The marketing team, now comprising 17 specialists, focuses heavily on social media content creation, ensuring that the brand remains connected and relevant to its community.

Rachael Wilde [44:53]: "It's mainly social. And I say, like, it's got heavy headcount. We've got three, like, marketing specialists, a senior content manager, and then interns."

Looking ahead, the company plans to explore international markets, develop new products, and potentially acquire or launch additional niche brands under the parent company structure.

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9. Advice for Aspiring Entrepreneurs

Concluding the episode, Rachael offers invaluable advice to early-stage founders:

1. Prioritize Joy: Entrepreneurship is consuming; finding joy in the process is essential for sustained success.

   Rachael Wilde [63:30]: "You have to love it and prioritize joy at like every single part that you can."

2. Focus on Content: High-quality, engaging content is pivotal for scaling and building a loyal customer base.

3. Community Building: Establishing a strong community fosters trust and brand loyalty, serving as a foundation for growth.

4. Embrace Risk and Learn Persistence: Success often requires taking calculated risks and maintaining persistence despite setbacks.

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10. Closing Thoughts

Nathan and Rachael wrap up the episode by celebrating her achievements and encouraging aspiring entrepreneurs to remain passionate and resilient. Rachael's journey from a marketing enthusiast to a $10 million entrepreneur exemplifies the power of strategic vision, effective content marketing, and the courage to navigate uncharted waters.

Rachael Wilde [63:30]: "I've had so much fun along the way. I love my job."

Nathan commends her for her openness and vulnerability, highlighting the inspirational nature of her story.

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Key Takeaways:

• Strategic Branding: Differentiating TBH Skincare by positioning it as a community-led brand rather than traditional clinical branding.

• Content is King: Leveraging authentic, engaging content on platforms like Instagram and TikTok to drive organic growth and effective advertising.

• Adaptive Scaling: Navigating the challenges of scaling a startup through meticulous cash flow management and strategic mergers.

• Community and Trust: Building a loyal customer base through genuine connections and understanding customer pain points.

• Resilience and Passion: Maintaining enthusiasm and finding joy amidst the stresses of entrepreneurship to achieve sustained success.

Rachael Wilde's story serves as a compelling blueprint for young entrepreneurs aiming to make a significant impact in the competitive skincare industry through innovation, strategic marketing, and unwavering dedication.

Transcript

[Rachel]

It wasn't a side hustle ever for us. We just got the licensing rights to this cutting edge tech in a huge category. People in that industry believed that it should be a healthcare professional LED brand. But I saw a huge opportunity in the category to do something different and actually go against the grain. There was a lot of stress in the business. We're getting to the end of that 250,000. Like the Runway was out. We're personally guaranteeing that loan. We're going to lose all our friends money. We're going to lose all our money money. It's such a all consuming thing. You know, you have this thing that runs your life so you have to love it and prioritize joy at like every single part that you can.

[Nathan Chan]

Hear.

[Rachel]

The stories, learn the proven methods and accelerate your growth and future through entrepreneurship. Welcome to the founder podcast with Nathan Chan.

[Nathan Chan]

All right, Rachel, here we are in the studio. Thank you for coming down. You've been able to slot this one in amongst all of your other meetings, but we're saying offline. It's so good to talk in person. So the founder of TBH Skincare, but now you've recently merged. I want to talk about that. York Street Brands. You've merged the business. But talk to us about how you started this amazing brand in 2019. What led to you starting tbh?

[Rachel]

Well, first of all, thanks for having me. It's a pleasure to be here. Yeah. The story about starting TBH is a little bit of a different one, I think. I always say I wasn't someone that ever had an aspiration to start a business. Wasn't really something that was ever playing on my mind. I was obsessed with marketing. That's where I found myself in my sort of after school life was at uni, studying marketing. I loved it. Ended up being a bit of a nerd at uni for marketing and just felt like I was quite a creative person. When I was coming out of school, I didn't know whether I wanted to do sort of like design, like fashion design, interior design, or whether, you know, I wanted to do something a bit more structured like marketing. And I figured I had quite an analytical brain at the same time, but was quite creative and marketing was such a good blend of those two things. So ended up in a marketing degree. Loved it. Came out of uni and just ended up in a pretty, I would say a regular corporate job. But it wasn't super regular. Was in medical devices, which was an industry that I never even realized existed until I was in it. You Know, I'd never considered how products get sold into hospital and healthcare. You know, the things that get used during a surgery, like how they get there, who sells them, what companies create them. And that's essentially the world that I found myself in after university. So landed a job in medical devices and was there for about two and a half years. But funnily enough, I was their first ever social media head. And a highly regulated industry, like, you wonder how social media really plays into the selling of medical devices. It was heavily B2B focused, and that digital team was in its infancy when I joined that company. And by the time I left, it was a team of 30. So I had really good commercial experience in that role. I learned a lot about basically how businesses work.

[Nathan Chan]

Yes.

[Rachel]

You know, I was privy to the fact that, you know, we were a distribution company. There were agreements between sort of the suppliers and the. And the company, you know, engaged to sell the products, how the salesforce worked, all of these different things that I guess unless you go into a job like that, you just wouldn't even know. And it was through that job that I came across a technology that ended up being the whole thing that started TBH skin care. So one of the companies in this field was. Had this incredible patent that could break down what's called biofilm in the body. Sounds really technical. It's basically just a really core part of fighting bacteria and so infection control, wound care, like, it has all these different applications. And they also realized that it could be used to treat acne. And so coming across that type of a product and then knowing how that distribution model worked, I was interested mainly from a consumer point of view. Being such a big beauty consumer, having acne for such a long period of time, I was interested in the tech that was going behind it because it's very different to anything in market. I read the entire patent behind the. Behind the technology, which is like 40 pages. Yes. And I was like, this is amazing. And then they had done initial clinical trials against, you know, salicylic acid, benzoyl peroxides. It had really impressive results. It was gentle. So I was like, what's happening with this amazing tech, this product? And then I knew how a company like that typically worked off a distribution model. And they were focused in hospital and health care, but they had this beauty product which is like a completely different industry and, you know, one that you can leverage through E. Com and all these different things. So started asking a few questions. And I think I've always been someone that took that type of an interest in, you know, how brands come to be. I was always someone that read a lot of like strategy books, like business books. You know, people joke that I like can't read a fiction book. I've actually forced myself into reading fiction now. But yeah, I just loved all that stuff. I loved strategy and I did actually my like favorite, and I sound like an absolute type like nerd here, but my favorite course at uni was marketing strategy. And yeah, it sort of pulled the whole way through like my early career. I just loved sitting in that strategy piece. So coming across the tech, my brain naturally went to like, what happens with a business like this? What's the possibility? And it was coupled with like a lot of naivety as a 23 year old thinking, like, oh, I, you know, I've started to see as a consumer, these e comm brands come in and start to boom with influence marketing and meta ads. Like it was that era. I was probably like the tail end probably of that era. Like you know, your highest miles, your frank bodies, like they had all come into existence and boomed. And I was like, what? What if that type of like brand experience could be brought into acne but with a patented tech that is, you know, at its core at a formulation level like entirely different. And so this ended up being like a dinner table conversation between myself and my mum and her partner. And I was like, yeah, I think there's like a huge business here. And that then entailed in us going to business together, myself and my mum. She again has never started a business before. She's not, you know, like I would say I'm more of like that risk, like I have more of a risk appetite. She's an accountant by trade, like very analytical, like really in the numbers. She had worked in management consulting, legal services, like big corporate industries in that accounting, you know, role. And she'd started her career in like a big four. So like so different to then going like, okay, I'm gonna do a skincare startup with my daughter. But the two of us decided that it was something that we thought was really cool and wanted to do. So in the next two weeks after that dinner table conversation, we actually ended up securing a meeting with that company to talk about licensing the tech.

[Nathan Chan]

Yes.

[Rachel]

And after hours I'd go to work, come home and in the evening, you know, after work, I would start building what I thought the brand could look like, how we would launch it, what we would name it. Like the go to market strategy, the tech stack, like the ecom tech stack. I Was already like looking at in the hours after work and put together a pitch deck. And she did all the startup modeling and costing.

[Nathan Chan]

Yes.

[Rachel]

Based on that. And then. Yeah, we went and pitched for the licensing rights and we won them.

[Nathan Chan]

Yes. Wow. Okay, so then that was 2019.

[Rachel]

That was. Yeah, the end of 2019.

[Nathan Chan]

Okay. So pre. Just before COVID Yes.

[Rachel]

So it was about October and I quit my job as soon as we won those licensing rights. And then we launched in market. It was the 18th of March 2020.

[Nathan Chan]

Okay. So it's pretty quick turnaround fast.

[Rachel]

Yeah.

[Nathan Chan]

Yeah. So talk me through that.

[Rachel]

Yeah, well, we. I think the good thing was, is that we had the formula.

[Nathan Chan]

Yes.

[Rachel]

At least.

[Nathan Chan]

Yes.

[Rachel]

So it wasn't like we were formulating from scratch. That was ready.

[Nathan Chan]

Yes.

[Rachel]

So it was about building the brand. What did that like, you know, finalizing the name, getting the trademarks, incorporating. Yes. Like building that corporate structure, which I think was really helpful having someone like my mom in the business because she was like, okay, let's. We're going to have a parent company that, you know then. Which was actually really clever. That came in handy later, sort of bit of corporate structure. Then we worked with a agency just to develop the visual identity side of the brand. So I had done all the tone of voice, pace, you know, all of that brand work. And then it was designing the website, which I did with a mate.

[Nathan Chan]

Yes.

[Rachel]

I did it with a friend who was like, just studying design.

[Nathan Chan]

Yep. On Shopify.

[Rachel]

Yes. Well, we designed it. And then I actually engaged a developer. I did a custom build.

[Nathan Chan]

Okay. Wow.

[Rachel]

Yeah. From the start. But it was. It wasn't crazy. I think it cost us maybe ten grand, which is like quite a bit.

[Nathan Chan]

That's a lot for starting.

[Rachel]

We did raise money with family and friends.

[Nathan Chan]

Okay.

[Rachel]

That part. So, yes. Once we've done the startup modeling, we went, okay, well, now we actually need to get the money.

[Nathan Chan]

Yeah.

[Rachel]

We tipped in our own money.

[Nathan Chan]

Yeah.

[Rachel]

And then we went out to about 10 family and friends, and they put in, you know, sort of between between 10 and 20,000 each. And we were like, it can't break the friendship. Yep. Again, we might lose all the money. Like this is. We think it, you know, has legs, but we've never done anything like this before, so nothing's guaranteed. And they came in. So we had about 250,000 to start.

[Nathan Chan]

Got you.

[Rachel]

And we went straight to the bank and got a loan.

[Nathan Chan]

On top of that.

[Rachel]

On top of that for $120,000.

[Nathan Chan]

Wow. Okay.

[Rachel]

Yeah.

[Nathan Chan]

So you basically had close to $400,000 to launch.

[Rachel]

Yeah.

[Nathan Chan]

Wow. That's a big move. First business.

[Rachel]

I don't know. I think we just like, we're so excited by the tech that we were like, you know, we have to do it justice. Like this is going to be a real business. It wasn't a side hustle ever for us.

[Nathan Chan]

Yeah.

[Rachel]

It was like we just got the licensing rights to this, you know, global, like tech.

[Nathan Chan]

Cutting edge.

[Rachel]

Yeah, like it's cutting edge tech in, in a huge category.

[Nathan Chan]

Yes.

[Rachel]

Like we have to make it work. I think that was the thinking.

[Nathan Chan]

Yes.

[Rachel]

But yeah, I mean we got in, we had to buy a lot of stock in the beginning. So the majority like I think was like $100,000 went straight to stock.

[Nathan Chan]

Yep.

[Rachel]

So yeah, I think that's the thing with a product based business is the cash goes out the door quickly.

[Nathan Chan]

Yes. So did you launch with just, just the one hero product or talk us through that?

[Rachel]

No. So again, I'd done a little bit of reading research around how to sort of build a proper e comm business. I knew that having one skew was going to really hurt things. Like average order value.

[Nathan Chan]

Yes.

[Rachel]

Not give people sort of like options for bundling or anything like that. So wanted to have sort of like a small, medium and large bundle for people to pick from. Like very basic, like fundamentals down. And so we brought in a cleanser and we actually, we were waiting on the cleanser with the tech in it to come and we, I think we found out on Christmas Eve that it wasn't going to be ready time. And we were like, oh my goodness, what are we going to do? Like, we don't have time to formulate. So we went and found a ready, ready to go formula.

[Nathan Chan]

Yeah.

[Rachel]

That was like a gentle cleanser. I was guinea pig basically for trialing a whole bunch.

[Nathan Chan]

Yes.

[Rachel]

Again, did basic research on like, okay, what do each of these ingredients do? What do we want to avoid? And just bringing in something really simple that the customers will know won't hurt their skin. But it wasn't doing any treatment. It was like, this is a gentle cleanser, this is your spot treatment. And then that was like ready to go. And then we brought in a little device to cleanse your skin with. And that was what we launched with three products.

[Nathan Chan]

Yep. Okay. Wow. And it sounds like from what I'm hearing, there was no point in time where you and your mum were like, this isn't going to work. Like immediately in your mind it was going to work. Right. Or there was a little bit of apprehension or I'm hearing a lot of confidence when you tell the story, though.

[Rachel]

Yeah, there was. I think it was a lot of excitement.

[Nathan Chan]

Yep.

[Rachel]

And I think we really believed in the product. Like, the product was. The product is incredible. So, yeah, that's what guided us, I think.

[Nathan Chan]

Yep. Okay. And so you have the licensing rights basically to sell B2B and B2C. Right, or just B2C.

[Rachel]

Just B2C.

[Nathan Chan]

Yeah. Okay. Yeah, just B2C. Okay. And then talk me through your pre launch.

[Rachel]

So pre launch was very organic. We did have like a small scale photo shoot, obviously, to get all the E comm sets ready. I was sharing on Instagram, like, I set up the social media page. I told everyone that I had quit my job on my own social media channel and that I was going and doing this thing, which at the time, again, I didn't even hesitate to do that. A lot of people were like, what if it doesn't work? And you've just told people, like, you're doing this thing, like now it's your face all over it. And like, it could not work. Like, beside the, you know, the Instagram page was at zero followers. But yeah, again, I don't think I really stopped to consider that outcome. So started sharing just organically on Instagram, the different stages of, you know, setting it up, where we were at the photo shoot, the products arriving. We also started running. Like we only had maybe like 20 samples.

[Nathan Chan]

Yes.

[Rachel]

And so we started sending those out to people to try and, you know, sort of give us results, feedback, reviews that we could then sort of use as testimonials when we launched. Yep. And so, yeah, we went through a very organic, low spend, lo fi sort of process pre launch and generated a small, small wait list of people.

[Nathan Chan]

Yeah.

[Rachel]

And I think the Instagram page was probably only at about a thousand followers by the time we launched.

[Nathan Chan]

Yep. So that was from. When did you start building your wait list and the, like the pre launch, when did that kick off? Because you said you launched when you.

[Rachel]

So it would have kicked off like.

[Nathan Chan]

Literally when Covid hit.

[Rachel]

Yeah, that is exactly when Covid. We were going into our first lockdown when we launched. Yeah. But the waitlist build would have been probably from the start of the year or late 20. 19.

[Nathan Chan]

Yep. Okay, so three, four months. And around how many people did you have on the wait list?

[Rachel]

I think it would have been like 800 max.

[Nathan Chan]

Yep. Okay. It's not bad.

[Rachel]

Yeah, bad.

[Nathan Chan]

Okay. And so you launch March. I remember that time. There was a lot of fear. Right. And that, that March. We experienced it in both of the businesses out. I had an E. Comm business and also founder. We. We experienced a decline in sales. But then April started to pick up.

[Rachel]

Yeah.

[Nathan Chan]

So did you guys. You launched in March. What did that launch look like? How did you go? How much you make? Talk us through.

[Rachel]

Yeah, well, we had nothing to compare it to. Right.

[Nathan Chan]

Yeah.

[Rachel]

You know, having my mum in the business, we had done month by month sort of forecast. And the Forecast for month one was $0.

[Nathan Chan]

Yes.

[Rachel]

So she's conservative. It's not like we had said, like, oh yeah, you know, a certain amount of the wait lists are going to convert. This is how much we think we're going to get. Even like, we didn't do that. We just said, you know what, we're going to get $0. Let's just go. Worst case scenario. Yeah. Which is actually kind of funny because that's how we continued to forecast like way into probably like 18 months later, we were still going like, what's the worst case scenario? We had the most conservative forecast. And so, yeah, we did four grand worth of sales in our first day.

[Nathan Chan]

Awesome.

[Rachel]

Yeah. Which was amazing. And the majority, I'd say, like, probably 50% of that was like really supportive family and friends. Yep. But yeah, the other half was people who had been sort of watching along and were keen to try it.

[Nathan Chan]

Yeah. Got you. And look, that was a really scary time. Like knowing what was going to happen was there. Were you guys that phase by Covid back then or not really Just more focused on the excitement of the launch this business. Like there was like, you know, people didn't know what was going to happen. Like.

[Rachel]

Yeah, again, I think the way that I saw it was people aren't going to be shopping in store, they're not going to be spending money going out. They're going to spend all of their time on their devices. This is probably the perfect time to be launching on an E. Com like based business. Like we're going to be able to capture attention online. And I actually think that was true because we had nothing to compare it to. Right. So I didn't know whether Covid was helping, whether it was hindering in terms of sales. And when the first lockdown lifted, we actually saw a drop in ecom sales.

[Nathan Chan]

And you only selling to Australia, not the world.

[Rachel]

Yeah, not only Australia.

[Nathan Chan]

Okay.

[Rachel]

And we already had all our stock here, so. And by that, you know, we're small, so we got like our year's worth of stock. You know, like it was okay. It wasn't like we were having to replenish this and then we were dealing with, you know, huge delays, which obviously there were on a lot of stock. I would, I could imagine if you were like already a booming business and then that happened, that would cause all sorts of issues to supply chain. But we were lucky in that we didn't really have that.

[Nathan Chan]

Yeah. You know, so it's a perfect storm. So talk to me, talk to me around the branding and developing the brand and what people could learn from the playfulness that you've, you've brought in the community that you've built from the early days. Because I think knowing what you've shared around your passion for marketing and strategy and being quite commercial like that, that was not by mistake.

[Rachel]

No, it wasn't by mistake. Yeah, that was very intentional and actually something that I had to push for in a lot of instances in terms of, you know, you're obviously seeking feedback from a lot of people and a lot of people in that industry who knew this medical tech believed that it should be a healthcare professional led brand or a clinical brand because it was about heroing this amazing science in the product. But I saw a huge opportunity in the category to do something different and actually go against the grain in that way and go sort of more brand led, community led, rather than sort of professional led.

[Nathan Chan]

Yes.

[Rachel]

And so when I was looking at, you know, how to position it, I had all of my, you know, axes, competitor maps out, you know, with price points, with efficacy, with tone of voice, with brand experience. Like I was mapping all of the competitors onto this axes like and I did like 20 and trying to figure out where the white space was. And it was so obviously in this like high efficacy but really like strong brand voice space.

[Nathan Chan]

Yes.

[Rachel]

And so I just went straight there to play. And because I was the customer, I had that personal experience that I could relate that back to. I had gone through a very emotional experience with acne. And that was, is the only way I would describe it is anyone who's dealt with that problem knows just how difficult it is. But the way in which the brands were dealing with, you know, that pain point for the customer wasn't actually empathizing with what they were going through or speaking to the true heart of how they were feeling.

[Nathan Chan]

Yes.

[Rachel]

And so I knew that there was an opportunity to connect with the customer in a different way than what all these other brands were doing.

[Nathan Chan]

Yeah, I see. So because the thing is, right, like you launched with three products, your hero product was an acne hack cream. Like that's a. That's a pretty strong name for a product, Acne hack. Like, I, I haven't had really big skin care challenges throughout my life. I actually used to have a lot of eczema when I was a kid, though. Like, really, really bad. Like, it was terrible.

[Rachel]

Yeah, right.

[Nathan Chan]

That. When I was a baby, my mum told me people used to come up to me and be like, oh, he's so cute. But then they get close and they see I had all these rashes on my face. But then I grew out of it. But no, you know, acne wasn't really a challenge for me. But one thing I do know is like, you know, you do get like pimples here and there. It was. It's hard to know what works.

[Rachel]

100.

[Nathan Chan]

So it's a very saturated market. There's a lot of solutions.

[Rachel]

Yeah.

[Nathan Chan]

So what you've done from a branding standpoint, how you've positioned it, like, even just the, like the name of the product, I think is very interesting to me. Like acne hack cream. Like, I've never.

[Rachel]

Okay.

[Nathan Chan]

I've never seen, like. Yeah, like. So I'm curious how, what, what were you, what else were you doing to stand out and make sure that people looked at you guys as an alternative solution? Because there are a lot of products out there.

[Rachel]

Yeah, a lot of products for acne. I think it was very much about that community build and I think we leveraged the fact that I had been the customer as a real connection point for the customer. So the experience that I had been through was so similar to what the customers had gone through, which was go through a traditional treatment pathway with your gp, get prescribed prescription, topical treatments. When that doesn't work, you get prescribed, you know, the oral antibiotic treatment. When that doesn't work.

[Nathan Chan]

I see. Like roacutane. Right.

[Rachel]

Could it. Well, this was like Minamycin. So not as full on as Ractane.

[Nathan Chan]

Yes.

[Rachel]

It was sort of a pathway that a lot of people in my generation, like, going through that teenage period. We all went through the exact same treatment pathway.

[Nathan Chan]

Yes.

[Rachel]

And, you know, it was getting prescribed the contraceptive pill.

[Nathan Chan]

Yes.

[Rachel]

And there were all these people who were coming off the contraceptive pill later on who were then dealing with adult acne again. And so we actually had quite a core niche within, like acne itself that we were talking to through my own story. It was like, you know, you've tried this, you've tried that.

[Nathan Chan]

Yeah. Really speaking to the customer.

[Rachel]

Yeah. Well, I was just sharing that story and I think so many people Saw themselves in that.

[Nathan Chan]

Yes.

[Rachel]

And then like was they were able to trust because they could see that there was someone behind the brand that really understood what they had gone through. Yeah.

[Nathan Chan]

So back then though there was not as many. Like it's. It's becoming a much more of a thing and I think will continue to rise. Is. Is founder led brands and building in public. Yeah. Right. How did you work that out? How did you build the confidence to put yourself out there? Because a lot of people. That's a common question that comes up. Like I don't people have that fear of putting themselves out there. Worried what other people think.

[Rachel]

Yeah.

[Nathan Chan]

Even worried about that. Fear of failure. Not even knowing even like that it strategically it is. It is a massive trend that we're seeing.

[Rachel]

Yeah. It's such a hard thing to answer because I don't even think that I have that mastered now. I've always been someone that has been like quite extroverted. I love like social connection is like, you know, I think every test that I've done has put me in like the 96 percentile of extroverted.

[Nathan Chan]

Yes.

[Rachel]

So talking to people and connecting with people is something that I think comes quite naturally. But that's not to say that I did not second guess myself that whole way through. I just think I didn't stop to think too much about it.

[Nathan Chan]

Yes.

[Rachel]

I didn't try and construct it in a certain way if that makes sense. Like it was very organic. If there was something happening, it was almost like in my DNA a little bit to pick up my phone and document it. I was always that person in my social life. Like if you watch me go on a holiday, everyone's like, I'm with you the entire way. You know, like at the airport. Like every single step I documented and uploaded because that was my natural habit. Yes. More as like a way of just connecting my friends. Like I'm not an influence or anything. That was just what I did.

[Nathan Chan]

Yes.

[Rachel]

And so I just took that into the business. It was very organic. It wasn't really something that I ever thought I need to do this to like build the brand. It was something that I almost just had fun with along the way. And obviously it's huge trend now.

[Nathan Chan]

Yes.

[Rachel]

And it's definitely something people are trying to lean into. I would say practice makes perfect. I would say like the more content that you put out, the more chance you have of something like really hitting and going viral. So just go ham, like go as nuts as you can with putting as much content out there as possible. And you'll learn what, what works and what doesn't.

[Nathan Chan]

Yes.

[Rachel]

But the confidence to do that only comes with practice, I think.

[Nathan Chan]

Yeah, 100%. So when it came to social, that's been a big, big channel for you guys. Instagram vs tick tock. Talk us through differences, things that you see, how it's progressed over the years and what's really working now.

[Rachel]

Yeah, we built the brand on Instagram.

[Nathan Chan]

Yep.

[Rachel]

So it was sort of pre Tick Tock.

[Nathan Chan]

Yep.

[Rachel]

And I think we have, we still have the most engaged community on Instagram.

[Nathan Chan]

Yes.

[Rachel]

So I think the community build is still where it's at on, in terms of like Instagram being the hero platform for that community build for us.

[Nathan Chan]

Yes.

[Rachel]

But we're seeing a new audience come in with TikTok where you have like that Instagram pace. It's incremental and you build it very intentionally over a long period of time. With TikTok, you can build that overnight. And I think that's the incredible opportunity that founders today have, is to find this audience on TikTok and find it quickly. But it's a game of patience and just grit because you have to be ready for things to just not work time and time again until you get that breakthrough. But we had the breakthrough on TikTok in 2022 where we had a video go viral and it brought in an entire customer base for us that we didn't have before, was slightly younger and it actually turned the business profitable basically overnight.

[Nathan Chan]

So talk me through that. Like, talk, talk me through that. Like what was the video? We can pull it up and like, you know, like talk me through that.

[Rachel]

So this was sort of in like I. We had. So this was 2022.

[Nathan Chan]

Yes.

[Rachel]

We had been working in a co working space by this point. So we had sort of gone through the first phase of the business, which was the first 18 months we were in Covid. We were working from home. We were packing and fulfilling from home.

[Nathan Chan]

Yep.

[Rachel]

And all very small scale. Yeah. We then decided sort of after that that we were at a size where we could move into a co working space, keep all of the product in a small warehouse, work from there as well. And we wanted to hire in a part time marketing coordinator.

[Nathan Chan]

Yep.

[Rachel]

We did that. So it was sort of phase two. That was where we were at when this happened.

[Nathan Chan]

Yes.

[Rachel]

And things were going well. I think we were, you know, at about 650k in revenue a year. So. Solid.

[Nathan Chan]

Yeah.

[Rachel]

But not profitable. We were still burning through cash and we're spend a lot on marketing yeah.

[Nathan Chan]

So why is that?

[Rachel]

Why? Why not profitable?

[Nathan Chan]

Yeah.

[Rachel]

We were reinvesting everything.

[Nathan Chan]

Okay. So it was by design.

[Rachel]

Yeah.

[Nathan Chan]

Okay.

[Rachel]

Yeah. Because without the marketing, we didn't have the revenue.

[Nathan Chan]

Yes.

[Rachel]

And so we hadn't yet reached that critical mass.

[Nathan Chan]

Yep.

[Rachel]

Where we could essentially profitably scale. It was like trying to build that customer database to that critical mass.

[Nathan Chan]

Yep.

[Rachel]

So that we could get past that.

[Nathan Chan]

Yes.

[Rachel]

We had incredible. We had an incredible view on our e commerce stats because of Bridget, who's my mum in the business, doing all the analysis on the back end and being pure play, we had like the cleanest amount of data there.

[Nathan Chan]

Yes.

[Rachel]

We could see cohorts how, like when they came back to buy, how, you know, the retention rate, customer lifetime value. So all our forecasts were built bottom up on. We knew like guaranteed when the customers were coming back. It was like cyclical. Like it was. Every single cohort was the same.

[Nathan Chan]

Yes.

[Rachel]

So we had then built those forecasts bottom up. We knew where the critical mass was and we were looking to that.

[Nathan Chan]

Gotcha. Got you, got you. And can you talk me through what was the critical mass?

[Rachel]

I mean, I don't even remember the exact number, but we could see the, the baseline business building.

[Nathan Chan]

Yes.

[Rachel]

Because of the fact that it was a consumable. So people were coming back.

[Nathan Chan]

Yeah.

[Rachel]

And so we knew that if we could build the base to a certain level.

[Nathan Chan]

Yes.

[Rachel]

Then it would self sustain.

[Nathan Chan]

Yeah. Okay, got you. All right. So 18 months.

[Rachel]

Yeah.

[Nathan Chan]

You started playing around Tick Tock.

[Rachel]

Yeah, very like light heartedly. We'd started up a Tick tock page for tbh. I also had my own personal TikTok which I just messed around on. Like it wasn't business orientated at all. Yes. And that was just a Covid like hobby or like bit of fun that I was having.

[Nathan Chan]

Yep.

[Rachel]

And then tbh, we were doing things here and there. We weren't particularly consistent. It was something that I'd brought in a marketing coordinator to also have a look at and play with and help me. Film stuff.

[Nathan Chan]

Yeah.

[Rachel]

But there was no real strategy. It was just like again, let's put out as much content as we can in a week with everything else going on and wearing all the other hats in the business.

[Nathan Chan]

Yeah.

[Rachel]

And just see what happens. And one day my marketing coordinator got sent a segment that was on radio that Abby Chatfield had hosted this segment and they were talking about acne in the segment and she mentioned the product and said for anyone out there who's, you know, is struggling with their skin, this is the product that, like, cleared my skin. It's incredible, you know, and it was like a sort of throwaway line, but it was in there. And she got sent it five days later after the radio segment aired by a friend saying, oh, my goodness. I'm just listening back to the radio segment on Spotify because it goes uploaded in Spotify episodes. Have you guys seen this? And I was like, oh, my gosh, no, haven't. Haven't seen that. And I was leaving for the day. I was like, I'm gonna listen to it when I get into the car. Went and got in the car and thought I'd seen people filming, like, blind react videos in the car. And so I thought, I'm gonna film, like, a blind react to hearing this for the first time. So I just put it on in the car. I was just sitting in the car listening, and my reaction's not even that crazy. Like, I've just heard it. And I was like, whoa, what the hell? You know? And then I put it up and captioned it and put a bit of text on the. On screen, whatever. Uploaded it to my personal page and didn't look twice. Like, I edited it there and then.

[Nathan Chan]

Yes.

[Rachel]

In the car.

[Nathan Chan]

Yes.

[Rachel]

Uploaded it and drove home. And I wasn't. I'm not as. Back then. I used to drop so much more these days. So I wasn't someone that was like, on. I was on Instagram, like, yeah. At night.

[Nathan Chan]

Yeah.

[Rachel]

I didn't actually open my Tick Tock app until the next morning. And I opened it, and of course, I had my Shopify notifications on.

[Nathan Chan]

Yep.

[Rachel]

So I woke up in the morning and I was like, what are all these orders? Like, yeah, I'm like, hundreds of orders just randomly overnight. I was like, what is. Like, it didn't even register to me. Like, something's happened with the TikTok video. I was like, what's happened? And then I opened my TikTok and my TikTok was at about 70,000 views.

[Nathan Chan]

Yes.

[Rachel]

So solid for overnight. Definitely more than I'd ever gotten on any other video, but not like a million. Like, we've seen more virality since then. But this was a video that converted. It had everything in it. It was organic. It had social proof because of the content of the video, you know, with Abby sort of recommending the product. And so it was like that social proof, the organic nature of it.

[Nathan Chan]

Yeah. Talk through the problem and the problem that it's after State. Yeah. Gold with cta. Was a cta.

[Rachel]

There was no cta.

[Nathan Chan]

Yeah.

[Rachel]

But I think that like people went looking people like, what is the product? I also love that as like a idea is like, bury the lead. Don't give everything away in a video because people, it drives engagement. When people like, what are they talking about? And then they feel the need to have it, they'll go digging. This is a generation who can find anything on the Internet, so don't feel any, like, shop it out, you know.

[Nathan Chan]

Yeah.

[Rachel]

But so this was like, that was just a very organic video. It made people be like, what is this product? Everyone was talking about it and then it was just driving like sales immediately. So it wasn't even just an awareness thing. It was like doing everything. Awareness consideration was the whole way through the funnel in one video. And we pegged nothing for it. We took that opportunity. We ran with it. Like, as soon as that happened, it was. I understood that, you know, I was jumping on making follow up videos of, oh my goodness, this video went viral. These are the orders that we got through bringing people in to the inside of what had just happened to the business.

[Nathan Chan]

Yes.

[Rachel]

And then that got pitched as a media story as well. Media picked that up. They thought it was really interesting.

[Nathan Chan]

Yes.

[Rachel]

So the media started talking about it. Great. We had media articles that we could use in ads. This thing had took on a life of its own.

[Nathan Chan]

Yeah.

[Rachel]

But also very intentionally. We knew how to take. And I think this is what you learn as a founder is like, you don't let a moment like that die. It's a once. It's like, you know, it's like a shooting star. You got to catch it and run.

[Nathan Chan]

Yes.

[Rachel]

And if you let it go, like, it's just such a wasted opportunity. So, yeah, we just took it and ran with it and never looked back. It took on, I think it went like that piece of creative.

[Nathan Chan]

Yes.

[Rachel]

Was generating income for the business for about nine months.

[Nathan Chan]

Yeah. Wow.

[Rachel]

And it had like an under $10 CPA.

[Nathan Chan]

Yeah. Okay, so. So okay, so then you took that creative and ran in ads. Yeah. Got you under $10 CPA with an average order value of what, 80 to 100 bucks? Yeah. Yeah. Wow. That's awesome.

[Rachel]

So then you talk about profitability. Because also that's the moment that I realized scalability came from content. Good content. Good content scales businesses. So profitably.

[Nathan Chan]

Okay, all right, so now we're getting somewhere. So talk me through what happened next. Because you started as time went on to scale the business also through retail.

[Rachel]

Yes.

[Nathan Chan]

When did that start?

[Rachel]

We were having conversations with Priceline at this exact moment. I don't Know what happened in August of 2022? But we had conversations around the merger.

[Nathan Chan]

Yep.

[Rachel]

We had this TikTok go viral and we were in conversations with Priceline.

[Nathan Chan]

Yeah.

[Rachel]

So the business went from 0 to 100.

[Nathan Chan]

Yeah.

[Rachel]

Like very, very quickly. Yeah. Which was incredible. And we were struggling to keep stock then on shelf and we couldn't keep up with order packing and we were hiring casuals every week and we had a whole set of different problems on our hands. But we were talking to Priceline, we had pitch to them and send them product and by the time it eventually came around to their next range review, they wrote back and we had a pitch meeting with them.

[Nathan Chan]

Yep, yep. And why Priceline?

[Rachel]

Oh, I loved Priceline from the beginning and I was very set on it. And again I got feedback on this, you know, sort of saying, but if you want to be the best in class Australian beauty brand, you know, at that time period it was like everyone just wanted Mecca. And Mecca's incredible. I'm a Mecca shop, I love Mecca.

[Nathan Chan]

Yeah.

[Rachel]

But if I am someone that I think I really understood who this customer was.

[Nathan Chan]

Yes.

[Rachel]

And the fact is, if you're dealing with a really bad breakout or you're struggling with your confidence in your skin and you're in that Mecca is not somewhere where you're naturally going to go for an in store discovery.

[Nathan Chan]

Yes.

[Rachel]

We loved the fact we still wanted to hero the science behind the product.

[Nathan Chan]

Yes.

[Rachel]

It was a medically sort of like backed product.

[Nathan Chan]

Yes.

[Rachel]

And therefore we loved having a pharmacist in store. We loved the fact that it was positioned with the other clinical products in the market.

[Nathan Chan]

Yes.

[Rachel]

And also from a price point, you know, perspective, we never wanted to price this, you know, aspirationally. It was never going to be luxury, it was never going to be out of reach. That was not how we wanted the brand to sit. It was, you know, this brand was for everyone who was dealing with that problem and we wanted to make it as easy as we could for people to get their hands on it. So Priceline was that partner in my mind because it had that blend of being a beauty destination and it was also that pharmacy that people trusted and that was mums as well, with teenagers. It was, it was. Had a broader sort of reach and inter regional areas as well.

[Nathan Chan]

Yeah, yeah. So it sounds like the Priceline deal eventually came to life. Did you have to raise any money? Because I know you did do an equity base. When, when was that equity?

[Rachel]

Crowdfunding was actually 12 months before that. So it was in October of 2021.

[Nathan Chan]

Okay. Okay.

[Rachel]

And that was to build out new product because we only had the three products to begin with. Then we brought in the other cleanser.

[Nathan Chan]

Yes.

[Rachel]

And then to build out a range, keeping in mind we want. There was a few things we were trying to achieve with that. We'd had feedback from potential investors that our margins weren't strong enough.

[Nathan Chan]

Yep.

[Rachel]

To withstand retail, international distribution models like anything like that. It was just like you. You're going to build a business that doesn't have enough margin in it, which was such a good insight.

[Nathan Chan]

What margin do you think people should be aiming for?

[Rachel]

It depends what category you're in. But in a category like this, the feedback we were getting was it has to be above 70% and ideally above 80.

[Nathan Chan]

Yep. Okay.

[Rachel]

Yeah.

[Nathan Chan]

Wow.

[Rachel]

And so we realized that we had some work to do and we didn't mind sort of having lost leaders almost in the range where we had the hero SKUs with lower margins. But other like from a blended point of view, we could then support scale.

[Nathan Chan]

Yes.

[Rachel]

So we wanted to build out the product line from a business perspective to sort of almost fix that model. But also there were all these other products that our customers were asking for. And so we wanted to then go and be bringing in these other products that they were looking for because they had built that trust through the core products with the brand and then they wanted more.

[Nathan Chan]

Yes. And why did you choose to go to your community versus going back to perhaps friends and family for the crowdfund?

[Rachel]

I think we were sitting down assessing all options and we loved the idea that we would get buy in here from a community that would then get to really understand the business, what we were trying to achieve, and then almost become champions of that.

[Nathan Chan]

Yes.

[Rachel]

At a broader scale. And yeah, I loved that it gave people an opportunity to get in on the ground floor with the brand. And so I thought it was a really cool model and something that was quite new to Australia still when we were doing it. So we did it through Equitize. And yeah, we. I think we again, we didn't think too much. Not like we assessed heaps of different options. To be honest, it was a really tough capital market. Like.

[Nathan Chan]

Yeah.

[Rachel]

Market when we were looking to raise that money.

[Nathan Chan]

Yes.

[Rachel]

So it was like every option was on the table, but this was one that we really loved and we saw it working well for us.

[Nathan Chan]

Yeah.

[Rachel]

Yeah.

[Nathan Chan]

Got you. Okay, so tell me when you guys, you said you're talking about the merger. Before we talk about the merger, I want to talk about kind of that Scaling piece. You talked about the content piece. That aha moment which really catapulted the brand. What are some other things that really catapulted the brand and really took you from that next step change? Because you guys. All right, I think 20 million a year now. Is that right?

[Rachel]

Yeah. So combined York street, we just finished FY24 at 22.

[Nathan Chan]

Yep.

[Rachel]

So tbh is 10 mil.

[Nathan Chan]

Yes. Got you. So what was some other really kind of growth catalyst moments or channels or times that you saw things really go.

[Rachel]

I think in the initial phases, like how we got initially to the 650 was heavily through partnering with the right influencers at that time and on longer term they were more ambassadors than they were like influencers because they worked with us on a 6 to 12 month basis and we didn't have mass of them. We had like a few we had really trusted great relationships with and I think that worked really well for us. We also had a lot of media interest in the early days, so we were able to get quite strong media cut through and I think in beauty that gives you a certain level of credibility that we needed.

[Nathan Chan]

Yes.

[Rachel]

Otherwise we were just another new E Com brand and we actually had something really novel behind the brand that media loved and were able to talk about. And I think that really helped us like gain that credibility and trust quickly with the customer group.

[Nathan Chan]

Yes.

[Rachel]

So that was, I think two of the things that were really important and that was the fire that we started alongside the organic piece. I would say that was like the fire that we had going where then when we turned on meta ads, we were able to actually get something out of that channel.

[Nathan Chan]

Yes.

[Rachel]

Because I think if we didn't have that, meta ads at that time would have been quite difficult. This was iOS update phase. That hit us as well, quite hard.

[Nathan Chan]

Yes.

[Rachel]

So yeah, there were challenges along the way as we were trying to scale a meta ad account.

[Nathan Chan]

Yes. Yes.

[Rachel]

Because profitability was just dropping out the bottom every time we tried to scale content through meta.

[Nathan Chan]

Yes. So were there times where you were like really flying close to the sun where you and your mum were like, this might not be always like every day?

[Rachel]

Yeah, like every day we're like, will we survive? Will we live to see the next day? I say that, but genuinely there was, you know, times where we were having to tip in more money to the business. Loans came in from, you know, her and her partner into the business. We had maxed out the overdraft facility.

[Nathan Chan]

Yes.

[Rachel]

We had. We're getting to the end of that, you know, 250,000.

[Nathan Chan]

Yes.

[Rachel]

Like, the Runway was out. And so it was like, how much cash are we burning? We'd have a monthly P L meeting.

[Nathan Chan]

Yes.

[Rachel]

Where it'd be like, okay, how much money do we lose this month?

[Nathan Chan]

Yeah.

[Rachel]

Like, how much cash do we actually have in the bank? And we're so, so lucky that we had her because she had such an accurate view on cash flow. So she managed cash flow daily. We had daily cash flow, like, wow, projections on what invoices are coming through.

[Nathan Chan]

What do you have to do when you're running it like that?

[Rachel]

Yeah. So that's why I laugh and say it was every day. Because she was looking at the cash every day.

[Nathan Chan]

Yes.

[Rachel]

And so there was a lot of stress in the business going, oh, my goodness, is it going to work? And if it's not, then we're personally guaranteeing that loan.

[Nathan Chan]

Yeah.

[Rachel]

We're going to lose all our friends money. We're going to lose all our money. For me, at that time, like, I was, I'm young, I didn't have a mortgage, I don't have kids. Like, you know, it was like, okay, well if I lose everything, then I'll just get a job, you know, and I'll earn the money back.

[Nathan Chan]

Yes.

[Rachel]

Them, I think it was a bit different. And so, you know, they're later on in their life, they're like, oh, okay, we might just, you know, be really setting ourselves back with this one. So, yeah, it was often we were worried about cash and strapped for cash and trying to come up with every solution that we could.

[Nathan Chan]

And when, when did it get to a point where like, yep, we're going to be good and it really start to fly.

[Rachel]

August 2022.

[Nathan Chan]

Okay, all right, all right. So it was tick tock with the unlock.

[Rachel]

Was the unlock.

[Nathan Chan]

Yeah, yeah. And look, I think you made a really good point around, like, that creative piece. Once you know how to really create good content, that's what scales. Because not only does it help organically, but that's the stuff that works on ads. Right now it's 80% creative. When it comes to media buying.

[Rachel]

That's exactly like the philosophy I live by. Yeah. And so now my team is built around content.

[Nathan Chan]

Yeah.

[Rachel]

Yeah.

[Nathan Chan]

So talk me through anything you could share. You know, our community would be punching me if I didn't ask you this. Like, what advice would you give to early stage startup founders when it comes to launching a brand? I always speak to the philosophy that you should be doing at least half a million bucks through organic channels before you even Try and test paid.

[Rachel]

Yeah, that's fascinating.

[Nathan Chan]

So I'm a big fan of going, going organic first because that's your rite of passage to come to your discoveries. Like we. You talk to and then you go to paid. But, like, what, what advice would you give to early stage founders that are trying to drive traffic to their store, that are trying to use these organic channels? What kind of content? Do you have any rules?

[Rachel]

I think, again, it depends on the category and who you're talking to. But if you can find like those pages that you think your customers are following or that the content that you find really engaging. I. If I watch a piece of content, whether it might be like someone's daily vlog, I'm like, why did I watch that? Like, I'll dissect it. And I'm like, listening to the voiceover and I'm like, what did they say in the first three seconds? They hooked me, like, and I'll, I'll write down people's like, first three seconds that they said in a video just as like a future reference. Like, yeah, yeah. So it's like, you know, it might be something so unrelated to my content, but there's a learning there that I can take. Like, why did this video get millions of views versus one that doesn't? And like, you know, we live in a world where attention is just like, you know, people don't have attention anymore. They have things being thrown in their face online every single second. So you have to grab them in like the first half a second or they're gone. So I think good content often comes down to, like, exactly that. Like, how it's put together and how you get that, like, draw in from, from the customer group. And then I think you can do a lot with storytelling, I think storytel and like, that emotional pull. Like, why would someone care about the piece of content? I say that and then like, I laugh because I look at some of the things that have gone viral on TBH this year and I'm like, had none of that. So you just don't know. That's why I say, like, volume is key. But I think there's a certain way that you can go about it where you go, like, okay, I'm going to be strategic in, like, how. And I always say, don't fall down the last hurdle. If you filmed a video, you've gone to the effort of like, like, concepting it, creating it, filming it. Don't fall down at the last hurdle. I say this to my team, like, execute with excellence. So if you're posting a video and you've done all this work and we've put in all this effort, you know, we've prepped a stunt or anything like that. If you get the first point, five seconds wrong, the video is, like, gone. So hold and watch it 500 times. Get other people to look at it and get the feedback. Seek the feedback. Because you don't want to, like, then. Yeah. Fall down the last hurdle.

[Nathan Chan]

Yeah. So you said something interesting as well. You've positioned the whole team and your strategy around that. That idea of content led. What does that look like?

[Rachel]

It looks like a heavy amount of headcount in content.

[Nathan Chan]

Okay.

[Rachel]

Yeah. And a specific content team. Content doesn't live. So we have a marketing team split into campaigns, content and growth.

[Nathan Chan]

Yep.

[Rachel]

And content is its own for a reason.

[Nathan Chan]

Yes.

[Rachel]

Yeah.

[Nathan Chan]

Okay. And is it mainly social or just you got a lot of content creators, effectively?

[Rachel]

Oh, no, it's mainly social. And I say, like, it's got a heavy headcount. We've got three, like, marketing specialists, a senior content manager, and then interns.

[Nathan Chan]

Yes.

[Rachel]

In that team.

[Nathan Chan]

Yes.

[Rachel]

Running across. That's across both the brands.

[Nathan Chan]

Yes.

[Rachel]

In York street at the moment. So they spend their time, like, majority on social.

[Nathan Chan]

Yes.

[Rachel]

But they also do email and, you know, copy.

[Nathan Chan]

Yep.

[Rachel]

And a whole bunch of other stuff.

[Nathan Chan]

Yeah. Got you. They're doing the intern play.

[Rachel]

Yeah. Interns, especially for tbh, are great because you're getting the customer in the door with the fresh eyes. You're getting the digital native, getting that person who's going like, yes. This is how I'm consuming media.

[Nathan Chan]

Yes.

[Rachel]

I'm, you know, I'm very much aware in my office that I'm 28 years old and that's, you know, that's. I'm becoming like, you know, they're like, oh, they'll roll their eyes at me now. And I'm like, oh, my gosh. So that's a really key part, though, of us staying connected to this customer.

[Nathan Chan]

Relevant. Yeah. On the cutting edge. Got you. So talk about this merger and your model around how you have a parent brand. I find that very interesting and how that came about. Talk me through that thinking and how it all came about.

[Rachel]

Came about, like I said in August of 2022 when something happened in the world and, yeah, everything just started changing in the business. We were trying to find cash, so investment that would come with some sort of knowledge base, so advisory, sort of. We wanted to bring in advisors and we wanted cash that also came with knowledge or networks or, you know, we realized that we had never done this before. If we were going to scale it, we needed someone else in the business who was going to help us.

[Nathan Chan]

Yep.

[Rachel]

And so that was our goal. We started speaking to angel investors, private equity firms. Like we spoke to everyone. And again, capital markets were still really bad.

[Nathan Chan]

Yep.

[Rachel]

So I can't tell you how many times I pitched. It was like a full time job on top of running the business, basically was pitching and forecasting and changing the model and doing all this stuff. And one of the conversations that we had was with a private equity investor and they said, oh, we actually have a skincare investment in our portfolio already. They're called Boost Lab. Looking at your business model and sort of the capabilities that you have in the founding team. We think that you should talk to them because there's potentially something there with complimentary skill sets, you joining forces, like whatever that looked like. And so we met with Craig, who's one of the founders of Boost Lab and he took one look at our business model and our numbers and stuff and he was like, you guys are missing cash. So he was very much like they had been private equity backed, they were heavily retail focused and we were pure play E Com very much like operating on a much smaller cash budget.

[Nathan Chan]

Yes.

[Rachel]

And yeah, he was like big believer in the, in the model when he saw it and went, yeah, you just need cash. And what we wanted to build in terms of how we wanted to scale the businesses, the distribution channels, the team that we wanted to build behind it, we saw a huge opportunity to go way faster together.

[Nathan Chan]

Yes.

[Rachel]

And that was ultimately like the reason why we wanted to join hands was because we saw we could leverage each other. They didn't have brand sort of building internally in the company. They didn't have like E Comm skill sets, they didn't have finance, you know. So you know, with Bridget, she came in as cfo, all of like they then had way more visibility over their cash flow and everything like that. And Craig is such a seasoned like entrepreneur. He has been in other consumer led businesses before. He's seen how it works. He's exited other brands. Like he can do the capital raising, the investor management, like all of that stuff he's got down. Yes. And they had really strong retail relationships as well. And they understood how to scale like, you know, they knew how to even from like a supply chain point of view, like understanding cash flow management, you know, warehousing, like all of these things.

[Nathan Chan]

Yes. They've seen the movie.

[Rachel]

They've seen the movie. They know you Know, yeah, whatever. Go take out that loan to finance, you know, the PO for Priceline because like, you know, no biggie.

[Nathan Chan]

Yeah.

[Rachel]

We're going, what do we do? You know, and so having that like wisdom in the business to encourage us to run like was actually a game changer for us. Yeah.

[Nathan Chan]

That's a very scary thing though because this is your first business. First three years, you've, you know, you guys have done the hard yards to get it profitable then.

[Rachel]

And we're about to.

[Nathan Chan]

Yeah. And then do a merger. Like that's a lot. Like I know myself my first three, four years in business, it was fun. Things were flying. I felt on top of the world. If someone tapped me on the shoulder to merge, found I, I'd be very, very cautious and hesitant. Like, where did. Yeah, like. And it sounds like the deal came about pretty quickly.

[Rachel]

Yes. So we started talking in August. It completed in March.

[Nathan Chan]

Yeah. Six months.

[Rachel]

Six months.

[Nathan Chan]

That's pretty good. That's pretty decent.

[Rachel]

We signed the like deal sheet on I think like the 23rd of December. I remember. I know it was Christmas Eve. 24.

[Nathan Chan]

Yeah, there you go. Yeah. So, yeah, that's a lot. Like you're like really speeding up that learning curve and really leaning into the unknown and uncomfortableness.

[Rachel]

Yeah.

[Nathan Chan]

I don't know if I could have done that like three years in.

[Rachel]

I don't. And again, like, I can't really explain it.

[Nathan Chan]

Yeah.

[Rachel]

And it was a huge risk. Like I would say it's the, the big risk we've taken with the business.

[Nathan Chan]

Yes.

[Rachel]

But we really understood our business where the shortfalls were, what we needed access to and we saw that this merger was going to give us that. I think the real risk for us was who are the people that we're getting into business with.

[Nathan Chan]

Yeah.

[Rachel]

Yeah.

[Nathan Chan]

So how'd you do that? Due diligence.

[Rachel]

I mean we had plenty of conversations with Craig and got sense that he was, you know, a stand up guy. And I think it was just something that we were going to have to risk. But again, like, it's not something we stood and pondered for too long. Like what could go wrong. We more saw the upside and hopes for the best. But yeah, so it was about like getting to know the guy and also getting to know the investors that were already existing in Goose Lab.

[Nathan Chan]

Yeah.

[Rachel]

And I think we got comfort around that pretty quickly. Again, I think you can tell when, I mean you say that you'd still never know. But we, we thought, you know what, these good people. Yeah. We can work with them.

[Nathan Chan]

Yeah. And that's fundamentally what it's all about. Right. Like, you want to just work with good people. When you hear these stories. Right. Of, you know, private equity or, you know, investors. And there's two sides to every table, right? Yeah, Two sides of that coin. And I, I've had so many conversations where they work out really badly and I've had so many that have worked out really well.

[Rachel]

Yeah.

[Nathan Chan]

And so it's. Yeah, it's one of these things.

[Rachel]

Yeah.

[Nathan Chan]

But it sounds like it's working really well.

[Rachel]

It is. Yeah.

[Nathan Chan]

So tell me what's next?

[Rachel]

What is next? So, I mean, we merged March 2023. Both of the brands scaled very quickly. So again, tbh got an injection of cash. We went into retail. They supported us doing that Boost lab. I took on their E Comm and their brand positioning and that they took off on Ecom, which is super fun to see. So the business has actually flipped. TBH is more of a retail brand now and BoostHub's more of an Ecom based brand.

[Nathan Chan]

Yeah, that's crazy.

[Rachel]

Revenue split. So you could see the complementary skill sets coming together. However, we went through so many challenges in that first 12 to 18 months. Because when we started scaling the businesses, both of them times by four in 12 months.

[Nathan Chan]

Yes.

[Rachel]

So inventory staff, like all of these things became such a nightmare. And we didn't have process hr. Like nothing. You're building it all from scratch. And so you sort of also have to slow down a bit. So I would say more recently, what we've done with the business is sort of reset and go, okay, what are we building? What, what opportunities do we actually want to run after next? And I think we're becoming more considered now.

[Nathan Chan]

Yes.

[Rachel]

Because we don't. We've built this great thing and we don't want to lose it. And so I almost think that there's more at risk now. And so it was about setting the foundation. So after the last financial year, as we were coming to the end of that financial year, it was like, okay, let's slow down, work out what processes we need in place. That was a lot of internal stuff. It was like, okay, let's get that down. Proper supply chain management. We're spending crazy amounts on air freight every single month because we can't keep up with forecasts. We don't have internal staff looking at that properly. Like all of these things that were holes in the business that had we gone put the foot down again, run even faster, it would have become our massive undoing.

[Nathan Chan]

Yes.

[Rachel]

So it was about realizing that the growth profile of the business was quite different at that stage and we actually had to cross out, you know, T's and dot our eyes and make sure that when we were gonna go, okay, next stage of growth that we actually had those foundational elements down. So now I feel like we've done a lot of that and next we'll probably look at, okay, where are the key growth opportunities for both of the brands? I think export is gonna be quite key, so international markets and seeing if we can hit one really well for both the brands. And again, not biting off more than we can chew, like going quite intentionally just into one.

[Nathan Chan]

Yes.

[Rachel]

And then new product development was quite a hefty focus over the last few months as well. We're coming to the tail end of that and again resetting, taking the learnings. What could we improve on? And we've got a lot of growth still left in Australia, so also just optimizing current state and making sure we're not leaving anything on the table before we could try and go elsewhere.

[Nathan Chan]

Yeah. And with all the. Now you're taking on two brands, you said you take on the E Comm side for Boost Lab. How do you work out how to split your time and team? Is it. It's more of a shared services model, right?

[Rachel]

It is. So we've now become so 17 people in marketing and as a team we service both businesses. It's almost like a mini, I don't want to say agency, but it's like almost like this legend behind the brands and we're working across both. The only part of the team that we split it out is in content, so everyone else works across both and we don't split it. We don't have like a hard and fast rule on how time is split. It's project based so it's like what's happening at this current point in time? What's the most important thing? It doesn't really matter if that's. If we end up spending 70% of the time on Boost Lab and 30% on TBH, it's like it's just a business priority, you know, just ticking off the priority list and going after what we need to first.

[Nathan Chan]

And for your personal brand though, and TBH is your baby, is that sometimes tough because you own half now? Well, you're splitting your time.

[Rachel]

Yeah, I'm splitting my time. I think the TBH part has been harder because in order to do my role as CMO in York Street Brands, I've had to come out of that founder like mindset of being in the day to day across everything and particularly across content. And that has probably been a huge challenge. And I always say to the content team, like, there's this very fine balance of needing to be involved because you need to keep that like, heart.

[Nathan Chan]

Yes.

[Rachel]

But then I also need to facilitate them and make sure they're autonomous and have ownership. And that is like a very, like, interesting dance. To do that, I think just requires a really high level of trust and like open feedback in the team, which I have with the content team, which is really lucky, but I think that's been really difficult. But we've built an incredible model now within York street and I think, you know, we'll be looking at how we can then leverage that across new brands.

[Nathan Chan]

That's what I was going to say. You'd be silly not to launch another brand underneath the parent or acquire another one.

[Rachel]

That's exactly what we'll be looking at.

[Nathan Chan]

Yeah. Okay. And what, how would you identify that? Like, what would it look like? How would you like, talk me through that?

[Rachel]

If we were looking at an acquisition, I always want to see like a really strong community opportunity, like an opportunity to build community. So either an existing one that's really strong or an opportunity to tap into one with that brand. Like the brand has legs to build community. And so strong founders in businesses I think are great, like great stories to leverage, I think is an important part of building another business in terms of like building that community. I love a niche. So like the more niche it is, like, I, I think that's great because you can cut through really quickly in a saturated category. So if they're not already niche down, could they niche down? That's sort of the model at York street is like going community based niche and like building fast by doing that.

[Nathan Chan]

Yes.

[Rachel]

And so looking for that opportunity in like a potential business, but also just product. Product is like number one thing. Like how good's the product and why is it different? And then, yeah, can you do that with the brand? And then if we were building something, I think we're looking for customer pain point under serviced niche within growing category and incredible product or like innovative tech.

[Nathan Chan]

Yeah, yeah. So we have to work towards wrapping up. I get the feeling that this might not be our last interview. You're on a wild trajectory. I was going to say, is there any kind of final words, parting words, any questions that you wanted me to ask you that? I didn't ask you. I shared with you a little bit about community, where they're at, anything you want to share before we wrap up. Rachel, this has been awesome.

[Rachel]

Oh, I think for the community. You know, like you told me, these are mostly early stage founders, people thinking about building something or, you know, in the early stages of building. I think like it's such a all consuming thing that you're going to take on. So you have to love it and prioritize joy at like every single part that you can. Because otherwise, you know, you have this thing that runs your life and you'll. There's always moments where you'll, I think, feel a bit like trapped by that. But like the joy, like find the joy in doing that because I feel like that's what will make it successful. Like, I've had so much fun along the way. I love my job.

[Nathan Chan]

Yeah, that's awesome. Thank you for sharing and thank you for coming down to the studio, sharing your story, being so open, honest, vulnerable, sharing the crazy stories. And congratulations on all of your success thus far. Like I said, I think you're in for a wild ride and I look forward to watching from afar.

[Rachel]

Thank you. Thanks for having me.

[Nathan Chan]

If you love this episode, make sure to check out my interview with Emma Green. Read on how solving a problem she was so passionate about led to the creation of skims and Good American. And so I do think it's so much of it starts with like, addressing things that bother you that you find, you know, you've got to create a solution for because, you know, at the.

[Rachel]

End of the day, you've got to.

[Nathan Chan]

Be passionate enough and sometimes crazy enough to go round and round and round to actually solve a problem.