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in its first year and now sits at $11,000 MRR. And that is before any additional one off sales. What is it? It's an anti inflammatory coffee brand. The co founder is here to share how they got this thing off the ground, what worked and didn't work in terms of marketing, manufacturing, distribution, and how
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you might be able to borrow from
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their playbook to launch a brand of your own. From McCor Coffee.com, eli Mash welcome to the Side Hustle Show.
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Hey Nick, thank thanks so much for having me. And thanks for the introduction.
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You bet. I'm glad you reached out. This is a really interesting one. My understanding is even as far as just this year, like you've got some decent traction, you're posting pretty positive revenue numbers. There's obviously product market fit here, but there comes this moment of realization. Look, unless we get serious about subscriptions, we're almost just treading water here with the cost of the product, the cost of acquiring a customer, the cost of fulfillment.
C
So we started the end of 2024, sold our first bag of coffee on my 40th birthday back November of 2024, which was, it was a great moment. But you know, as as you get super excited about the coffee and a new company and you know, everything is fresh, everything is new, everything is exciting. You kind of run like we ran. We went after things. Let's sell, sell, sell. And what we didn't do, even though I have an accounting background, is really think about the long term value of a customer and the cost of acquisition and the cost of product and the cost of shipping and the cost of everything. Right?
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Yeah, it all starts to add up.
C
We're organic certified. The organic path is great. It makes you do a lot of things, but it also costs money and takes time. We're selling a great coffee at the end of the day, but there's so much behind it. Every we, we were growing revenue, but we had not been able to get past like the break even point. Like we're just breaking even. We're barely making money. And what we did is we took a really deep look into our numbers. You're starting, you don't really know the long term value of your customer. You have to guess or you don't know how long they're going to stay. When we started digging into it, what we saw is when somebody becomes a subscriber, that means they like or love our coffee and they stay on for many, many, many months. On average over seven or eight months. Many of them have stayed on since the first sale for 18 months. But when you look at the one time subscribers, a lot of them come back, but a lot of them say, hey, thank you for the coffee. I have my other part of my life. I don't remember you. Right. Even if I liked you, I don't remember you. Or hey, I don't want turmeric in my coffee. Thank you for letting me try this, but I'm going to go back to regular coffee. Right. So when we looked at our numbers, we realized pretty quickly that in order to be successful, we had to become a subscription business more so or we needed to get people to come back more often. Right. Even though we're not subscribers. That's also why we started looking at retail as well. Because the cost of acquisition at retail is a lot lower, even if margins are lower. And then finally we're gonna be going to Amazon in a month. So all these things have added up to us saying our best business is definitely a subscriber. And then the subscriber is best because they get the best benefits from being part of our brand.
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Yeah. And I want to dive into all that LTV stuff and figuring out, well, how did we acquire these customers in the first place? But coffee on the surface seems like a really competitive space. And so you're trying to niche down and say, well, we're almost a subcategory within coffee. Talk to me about kind of the competitive landscape, the inspiration to start, like, why did this need to exist in the world?
C
It needed to exist for me and part of my family because for a decade I have been putting turmeric in my coffee. I come from a family of people who are naturopaths, chiropractors in that realm. And we've always, I've always taught that Food is medicine, right? Like preventative medicine. Food is medicine. And for me, I'd been putting turmeric in my coffee all the time. And I realized like, this is something people might want. And then when I started testing that with people, they actually don't want just turmeric in their coffee. Nobody really wants just turmeric in their coffee. So we started working with other ingredients that are very anti inflammatory, like cacao and, you know, cinnamon, Ceylon cinnamon, ginger, chaga, turmeric and all these things. And we actually had to come to a place where we're like, okay, is there an actual business here? Right? Like, is there a business? Mushroom coffee had been exploding. If you know, the mud waters of the world exploding, then a coffee that's been testing for toxins, those coffees are exploding. People are asking for an alternative to regular coffee and a healthier alternative. So did we know right out of the gates this is going to be a success? No, absolutely not. But we had an inclination, because we were drinking and our friends liked it, that we were willing and able to put some time and effort into it.
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Okay, so it was kind of an extension of what you were already brewing or experimenting with at home. It's like, well, what if we could produce this on a, on a bigger scale?
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That's right. It's not like I'm just a serial entrepreneur. That's the first thing I've ever done. It's the first idea that I'm like, this is actually a really good idea. I think we could help people. I still drink this coffee every day for 18 months straight. It was not something that we knew needed to exist, but we thought we could try it. And luckily as we started asking around town of how we can actually do this, because I have a full time job, that's what I do. I like my full time job. You know, I have three children. I need my full time job. I needed to make it so this could be a nights and weekends business. And I need to make sure that I had a partner that could help me do this. Yes, I could get the recipe in my kitchen, but I couldn't actually start making this coffee in my kitchen. It could not be that for me. So we took a leap of faith to work with a, with a manufacturing partner. And they took a leap of faith on us obviously too. And that, that actually took some time to negotiate and, you know, get them to actually believe in us enough that they were willing to do this. But we were able to do that after, you know, a few months of looking around Town.
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Okay, so what, what I'm hearing is this is kind of born from personal experience and almost family history. You know, food is medicine, anti inflammation as a big buzzword. We can piggyback on that and you know, cellular health and all of this stuff. Plus there's some level of validation from bulletproof, from mud water, from four Sigmatic, like for some of these other like Nichier type of coffee, coffee brands. Like okay, there maybe there's a, maybe there's a wedge into the market here. And so the next step becomes finding. Well, I'm not going to be able to roast these beans at home and you know, do this at the scale that I want to do. So I got to find a manufacturing partner. And this is like a local roaster. What does this even look like?
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The one that ended up being our manufacturing partner is about a mile and a half from my house. When you're in Minneapolis, the town's not so huge, right. Luckily, I knew somebody who was an investor in that manufacturing. Manufacturing place. It gave me a really warm introduction and that's how we were able to find them.
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Okay, what does it cost to run an initial batch or to get this organic certification or to do your, you know, oh, we're testing for toxins. There's some non zero startup costs here.
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We knew we could only do this if the startup costs were somewhat low. Right. And we found a manufacturer, told them our idea and got them to believe in us that we would grow to a place that actually made sense for their business. They were a coffee manufacturer, they had an organic certification already, but they'd never done spices. So I think a big lesson here is at least for our case, like we really wanted to do this. We knew we couldn't do it in the kitchen or hire our get if we have a job. We just kept saying, hey guys, here's our thoughts. We will buy some of the equipment. So there was a thousand dollar equipment spend to get like a, a grinder in for our stuff because they wouldn't touch it with their machines or a blender. And then we talked to them about, hey, if you guys add this, now you have more market opportunity for other brands that are coming in. You see the mushroom coffee exploding. You work with us, we'll help you understand this as well. We'll work with you on a different part of your business. Now you're starting shipping coffee rather than just doing pallets of coffee. And we'll help you guys organize to a place. And luckily for us, the operations manager there had already Been thinking about this stuff. So it became a. Okay, let's figure this out together. Here are the things we need stipulation wise. But to get it going, it was like a thousand dollars for machine. We basically told them and they agreed that we'll be on net 30. You're going to produce us and we're going to pay for a bag of coffee. The bag of coffee is going to be soup to nuts. The coffee you roast and grind, the stuff you blend and then you shipping it out. Take the margin you need. But we'll know exactly what it's going to cost us when you produce a cup of coffee. So every time we produced a bag of coffee, we sold that bag of coffee and then we got invoiced a month later from the manufacturer. So we were able to do it from a cash flow way that it actually made sense for us and we got them to believe in us and they still do believe in us. So I think that was a big, big insight here.
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Okay, that's an interesting structural negotiation in terms of the financing of it to say we're not going to buy a thousand bags up front for this huge inventory cost. It's like we're going to kind of pay as we go almost and hopefully we could sell it before we have to buy it.
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That's exactly right. We had a minimum of like, you know, we started was like, Hey, 100 bags for every order. I'm an order. Like we need to do at least a whole bag of our coffee. It was like 100 bags or something. And so a minimal risk. Right. And then as we progress though, they've been very straightforward that we need to continue to grow in order for them to continue to support this at this level. So then you have advertising costs that we had to start promising, hey, we'll put advertising spend behind this. Yeah, right. So that's how we continue to grow with them.
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Yeah. Have they come back and be like the volume isn't quite what we had hoped it would be or like there's some pressure on the manufacturing side like, dude, we need to increase this or it's not worthwhile.
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They've been really good with us. They are a pretty local business. They work a lot of local companies are not a, you know, a million square foot facility. Our products. My assumption is they're making the highest margin off us of any of their companies they work with because of what the work they do with us. Everything else is much more commodity business for them. So for us they do specialists. So they make a Much higher margin and they've seen growth every month and they're still very happy with it.
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Yeah, I'm drawing some parallels between this and the old like Amazon private label strategy from 10 years ago where it's like looking at what products are already selling. Hey, people buy coffee every day. What are some of the shortcomings to these? You know, looking at, oh, I wish it was more anti inflammatory, I wish it didn't have toxins, I wish it had cinnamon. You know, kind of filling in the gaps or listening to what the market is saying and then adding, hey, can you do what you're already making but with this little extra thing, you know, what is the added value, added benefit added feature that you can put onto it and say well now we have a new thing. You know, it's not completely revolutionary but maybe it's evolutionary from what was already on the market and finding a manufacturer already making that stuff.
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Protein coffee, creatine coffee, collagen coffee. It all exists to your earlier point though. It's very competitive. Right? Coffee is competitive. Some of the things we've dealt with for sure is even though our coffee is a premium product and it is as it's expensive to the daily user. Right. You know, it's somewhere between depending on how many bags the subscription, 22 and $30 a bag. It's definitely in the range of like those high purity coffees, mud water, so we're in that range. However, when you're in these higher price, there's a couple of things thinking about. When you're in these higher price, you have less people who are buying it. Right. At the same time margins aren't so strong that it can support growth without having people rebuy. So as you're thinking through an idea, margins, hugely important, more important than I would ever would have thought about. Right. Like there are always things trying to take money from you. Right. No matter what it is and having a product that people will buy over and over again.
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How did you arrive at this pricing? So I'm at the Website now, it's $30.95 of course subject to change for a bag of the whole bean and then 3,295 for the ground blend it looks like.
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So a couple things. Well we found like purity coffee and like life boost. These coffees are, you know, people know about them, found what they charge and they charge about $30 a bag. Okay. And what we did is we said ours has other things in it, we should charge more because it cost us more. These chaga cost $45 a pound. So there are things in there that we have to think from our margins perspective. And then you look at mud water between 40 and $60 and people are buying that they have, you know, I think 100,000 lots of subscribers. Right. And it's good. So we did it that way. And then we also said, but we are trying to be coffee too. We're not just trying to be these motto as a world, $30 is expensive. So we said, okay, let's people get people to subscribe and they can cancel anytime. Let's get that $5 off, get it closer and then people start liking it. You can buy two bags now you're closer to 23, 24 a bag and now it's in that coffee range of a bag. Right. I probably Change up pricing 30 to 40 times. Just testing things to figure out what works, what sticks, how do you get the average cart value higher? Because shipping costs are so expensive and if people aren't paying for shipping, we're subsidizing shipping or it's free depending on what you're, you know, what you pay. And margin wise I'm like, how do we stay in business?
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Right, yeah, the, the name of the game is yeah, increasing that average cart value. And the ltv, especially for the one off orders, it's like, well it's going to cost us a, a certain amount just to ship you a box. Do you want to throw in another bag? Is it's not going to cost us that much extra and our margins go way up.
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Those are the two things. I mean, listen, I know from a cost of acquisition on Meta, like happy to say, like we, we when we first started it was in the $50 range to get a new customer. Well now we're closer to $30, 28 because people are coming back, right? And they know our product more, they like us more, they're coming back. You know, Meta is pushing us, but there are some coffee brands like 60 or $70, but they need people to stay for a long, long, long time. Yeah, right. So you know, consumers out there like, oh, everything's so expensive. But at the same time, you know, if you have a product and this is not just a pitch for me, but it's a pitch for all the other high level, you know, coffee companies are charging a lot of money. If you have a high level product that you go on and you test if you want to make it niche down and make it really, really good, make it organic, make the best ingredients and then you have the costs like there's the prices are there for a reason and it's the way you have to do business to stay in business.
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Yeah, and the pricing is a signal too, that, look, this is not a commodity coffee brand. This is not mass market. This is luxury. It's premium and it costs more to make. So we're going to charge you more too.
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Yeah, that's right.
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Let's transition to okay, now we've got the, you know, first batch made. I think you said it was 100 bags from the local manufacturer and now we got to sell this stuff. So what happens to try and find your first customers? Eli's response is coming up in just a moment. But real quick, listener bonus for you. If you like the idea of selling the same thing over and over again, I put together a list of 50 other replenishable product ideas you might be
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able to carve out a little niche for.
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You can download that for free at the Show Notes for this episode Just hit the link in the episode description and it'll get you right over there. When you're running your business, you're going
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to come to this crossroads. There's something that you need done that
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either you don't know how to do
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or you're not the best at, or it's something you really ought to be handing off to someone else if you find yourself in that boat. Think this is a job for Sponsored Jobs when you sponsor your job on Indeed, you'll get matched with quality candidates who meet your exact criteria so you can focus on what you do best. Plus, with Indeed Sponsored Jobs, you only pay for results. Spend less time searching and more time actually interviewing candidates who check all your boxes. Less stress, less time, more results when you need the right person to cut through the chaos. This is a job for Indeed sponsored jobs. Plus side hustle show listeners get a $75 spons job credit to help get your job the premium status it deserves@ Indeed.com podcast just go to Indeed.com podcast right now and support our show by saying you heard about Indeed on this podcast. Indeed.com podcast terms and conditions apply. Need to hire. This is a job for Indeed Sponsored Jobs. One customer says this tool literally spoiled me. It's so easy. Another added that it's taken a point of anxiety and turned it into a seamless and easy process. Of course, they're talking about our sponsor, Gusto. Gusto is the online and payroll benefits software built for small businesses. It's all in one remote, friendly, and incredibly easy to use. So you can pay, hire Onboard and support your team from anywhere. Think of it like cleaning out your virtual junk drawer. All that admin chaos that's been piling up all year and then installing a lean and clean system instead. You can automate your direct deposits, payroll taxes, health benefits, 401k contributions, and you can do it in a way that fits your budget with no hidden fees and no surprises. Plus, if you have any questions, Gusto gives you direct access to certified HR experts. It's no wonder why over 400,000 small businesses already trust Gusto for their payroll and HR needs. Try Gusto today at Gusto.com Sidehustle and get three months free when you run your first payroll. That's three months of free payroll at Gusto.com SidehUSTle One more time, it's Gusto. G u s t o Gusto.com Sidehustleen
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so first customers, friends and family sent it out free to I think 60 people. And we basically said, if you like our coffee, please go online and review this. Right. That's the way we got reviews early on. And if you don't like it, we're not going to ask for a review. Just don't review it.
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Right.
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Got 28 to 30 reviews. Some people like, you know, they just forget and you don't want to bug them too much. Right.
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This is through Shopify.
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Shopify reviews, yeah, that we made them buy it through Shopify, obviously to get verified. So they bought it through Shopify. We'd send it out. That would be. That was a really good way for us as an organization also to see how our operations flowed. Right. So like go buy this. Here's a discount code, make the sale, give us a review. But at the same time, now our team in the background, or the manufacturing team is now operationalized to make sure that they do everything correctly. Right. So we started out very slow that way. That's before we sold our first bag. That's kind of. We can't count as like selling our first bag, but that is our first purchase from the manufacturer, kind of planting the seed.
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So when you do start marketing, it doesn't look like a ghost town. It looks like, well, people are buying this thing. People like it. You know, I have some positive testimonials and reviews.
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That's exactly right. But yeah, the first 20 year, we're definitely friends and family. We made a huge mistake here. Next. What we did, we didn't want this to be a just a, you know, a mom and pop brand. We did want us do want to scale this so we we did take, I think somewhere around $10,000 of our own money, said we are going to spend this in ads to try to move coffee and see if this works. And that's kind of like our. If it doesn't work at all, that's $10,000 down the drain. We'll close up shop. There's no market for this.
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Okay.
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Sort of thing. And we did that, and we did it too early. Like ads before we had any Instagram really up, any social proof, any influencers talking about our brand. Nothing on Amazon. People would see this, they'd, you know, Google it and be like, what is this brand? Do we trust this brand?
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Yeah. Right.
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So we spend a lot of money up front on ads before we sh. Of. We should have absolutely taken the time to find influencers first, you know, reach out, whatever. It was longer to get a real brand on that screen before we did that because we wasted. We wasted a lot of money doing that.
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Okay, that's really telling. That's interesting to hear. I appreciate you sharing that. Where it's like you almost. I can understand. Like we've been, you know, months in development of this thing. You know, we finally got the product and now we got to move it. Let's go get. Let's go find some customers. But it's like we need to establish the foundation first.
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Yeah. 100%. Should have established the foundation first, done pre launches, whatever people do to get people on there, more than 20 reviews. We could have spent two months seeding influencers and getting videos all over the place.
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Yeah.
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And we didn't do that. And like I said, we were in the $55 cost of acquisition. And now that we've done a lot of those things and we now we have our acquisition cost dropped to $29. Like that show says a lot, right. About a brand being true. And we would have saved a lot of money and a lot of anxious nights being like, why is no one coming to our site?
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Yeah. And that's where the math starts to make hopefully more sense. Okay. If it costs us 29, 30 bucks to acquire a customer on average. Well, maybe not on average, but the best customers stick around for seven or eight months and okay, our margin on each bag, your gross margin is, you know, X. Then all of a sudden, you know, this is a great business. We'll go out and acquire as many customers as. As we can.
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That's right.
B
But then it's like, well, what are those gross margins? And what happens to the people who cancel after one month? Or the. Yeah. It's, it's a whole, it becomes this. And that's probably the fun part of running a business is the optimization and the tweaks and well, how do we make this work?
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Yeah, you always think like, okay, is it, are people not coming back because of product? Are people not coming back because, you know, one of our things we have is it brews a little bit slower. They don't want to wait so long. Or maybe they have a very slow brewing machine that kind of got a little dirty on the machine because it's brewed too slow. We have some problems as an early business we're trying to fix. Right. And at the same time though, we have 94, five star reviews. So are people telling us they love it or people who don't love it not coming back? Right. Not saying anything. So as an owner of a business where I think we have the best coffee out the market, what I believe is you find a niche that's large enough that not everyone's going to like your stuff because no business has everybody liking what they sell, that it can scale in a right way. When we look at our numbers, we're still trying to figure out, can we put, making up a number, can we put a hundred thousand dollars in ads? And we know our payback period will be four months, we can go raise money at that. And this is a rock solid business. If all of our people were subscribers to go back to subscription, this would be the next grooms, right? But it's not the next grooms because we have people who are not subscribing. So I think for us, like continues to optimize what matters to people, how to make our value proposition more and better for people every in dropping, I
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mean, cutting that customer acquisition cost almost in half. Talk to me a little bit about kind of laying that foundation, whether it be the social proof, the social media accounts, the influencer outreach, like what, what did you do to move that number in such a meaningful way?
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Yeah, this is interesting. Right? So I think there's a couple things to be said. We have only paid two influencers out of pocket ever. We have done affiliates where we give them a higher level of commission than we want to, sometimes up to 60% on the first sale. Because you look at your cost of ads on meta versus the cost of that first sale, that still makes sense, right? Even though you're losing money on that customer, for sure, you need to, you know, put them in. But we did a lot of reach outs to people under 10,000 followers. Hey, give you A free bag of coffee. If you like it, we'd love you to post something. If not, no problem. The amount of kind people out there that are willing to post, if they like your product, to tell their audience, hey, this is a good product is way higher than I expected. Way higher. If you're a nice person, you don't ask for much. You say, hey, I understand. You don't. There's no. There's nothing you need to do. But if you do like it, we obviously are to appreciate this for our small business.
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Yeah. You're looking for these accounts under 10,000 followers. Are these people in, like, the coffee niche or these people like you, just in the health niche?
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Call it under 30,000. We sort of start Health and Wellness. We definitely focus on health and wellness. People that you could tell are into, like, organic foods.
B
Okay. And so the pitch is, I'll send you a free bag if you like it. Would love for you to post. You know, here's the affiliate code you could use. And if you don't like it, no obligation.
C
We never started any affiliates early on. We just said, we'll give you a free bag, coffee. If you like it, post it.
B
Okay.
C
We didn't even talk about affiliate at all. It wasn't any. Like, hey, here's what's in it for you. It was more, we're trying to grow our company. We think your audience will like this. If you think your audience will like this too, because it's different, and it's kind of in what you're into. We'd love you to post. And, you know, we got probably 50, 70 people who posted because of that.
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Okay. Yeah, not. Not nothing.
C
So it was real, and we spent money doing it right. You're sending coffee out, and you don't know who's gonna hit. But it built some great relationships. Like, there's some people now, like, some of the people maybe in a hundred thousand, 75,000, 50,000. But the other thing I would say is very important. We had a partnership, an affiliate partnership, you know, with somebody who has 250,000. Thought it was exactly what we would like. The age, the sex, everything. You know, the mantra. Everything was perfect. And, you know, over a couple weeks, I think it was a couple bags of coffee. And then we had a partnership with somebody who had 12,000 accounts, and it was like 20 bags of coffee. When you're going out and reaching out to people, like, numbers are important, and even if they're getting a lot of traction, it might not matter to their audience unless they're specific on that niche, which I found a little bit interesting because I would have thought for sure the 250,000 would sell way more.
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Yeah, you would think just on the follower optics. But, you know, it's whatever the algorithm decides to push at any one time or what went into that video.
C
That's also true.
B
And I imagine this is kind of a shotgun approach. So you kind of cast a wide net and you're going to have to do outreach to 10 before you get two or three yeses. And maybe half of those people end up posting and hats a kind of a big funnel to operate at the top.
C
For the first year of my business, I would be in bed at night and rather than scrolling Instagram, I was sending messages to people on Instagram.
B
Nice.
C
You know, messages, messages, messages. And I am, you know, I sell in technology. So my mantra is not just blast and pray. It'd be like looking at them, understanding them, and giving them a reason why I picked them. So I would do some research. And this is before all the AI stuff even a year ago. Right. So, like, I take a lot of time doing it. I think that that mattered too.
B
All right, so this is the affiliate or, sorry, the influencer outreach strategy that did. That did end up moving some product and it's still driving back to the Shopify store at McCor Coffee. It's not TikTok shop or anything like that, right?
C
That's correct. Yeah, we tried TikTok for a minute. We. It's just hard to do too many things at once with the two of us. But the affiliate piece now, you know, ask my affiliate. Then we've moved to an affiliate model. We get people incoming sometimes now that ask us to be affiliate. You know, I would say people who ask, I would say one in five actually ever do anything with it. They just, you know, want to be part of it and they might push one thing and then they're done. Some people will get into it. What I really enjoyed about this process is that I have found seven or eight people who are very well known in the health and wellness space that really like our coffee that had posted organically for us. And just today, you know, won't. Won't say the name, but one of the OG Peloton Fitness people reached out to me and said, hey, I'd love to partner with you. And that was really cool, right? Because somehow she had seen us in there. And now I got to figure out this thing that. I wish I had more advice here, but how do I partner? Is it piece of equity. Is it just dollars that we can't afford? Is you know, this person is probably too big for affiliate.
B
So yeah, they're going to want a big upfront fee. Yeah. How's it going to work?
C
Right. So there's all these things to figure out now and like you know, from a business standpoint but these people do matter, right. Especially if they reach out to you and they're like into your product already because they bought it on their own like it matters. And you know, that's something that I would look to, you know, people on your podcast like for advice of what the best approach is.
B
Yeah. I mean to keep it low risk. You know, the performance based model is kind of leaves some upside for them and minimizes risk for you.
C
Yeah. It seems like the only approach when you're small, you can don't have the money to pay people. Right? Yeah, we did pay one guy who had almost a million followers in the space. He loved our coffee. We had been talking for a while think ended up paying him like I think it was almost fifteen hundred dollars plus of commission. And I would say we made our money back plus some. But it wasn't like a huge thing. But you know, I think taking a shot once in a while because he did amplify us a lot to a point that yeah, we maybe our dollars and cents to make sense but there's an awareness, marketing perspective, other influencer coming to us. So I do think it's worth taking a shot once in a while if it makes sense.
B
Yeah. And it becomes an element of social proof if you're able to, you know, embed that video into your own marketing material or use it for ads, there's a whole ecosystem to be built around that for that one, one time cost. Yeah.
C
But you know, going back to your original question, like kind of how the growth happened, it's all these things, right. Like it is all these things that matter at the end of the day. Facebook by far has been our best acquisition, but it's also by far the most expensive. Right. So we're trying to determine kind of what that mix should look like. We are doing more Google Ads now because now that I would say Google Ads early on probably wasn't wouldn't be a good idea because nobody really knows what they're, you know, you. But once they get you know them more and they're like oh, what's an organic turmeric coffee? Right. And like they type it in, that's been pretty good to Google Ads. You know, people who are Actually starting to try to look for us.
B
Yeah. And if you have a little bit of website traffic, maybe it's from the Facebook or the meta ads and you can retarget and, you know, more touch points before people are ready to buy. There's a whole thing.
C
I mean, Nick, I know this is your interview, but put the question back to you. Like, you've done this too. You've grown this podcast to millions and millions of downloads. Like, your acquisition channel has been probably a lot word of mouth, the beginning and then email and now meta gas a little bit. But even though you're in a different business than me, it's probably somewhat similar.
B
Yeah, you're trying to encourage word of mouth. You're trying to turn one listener into two. Tell your friends. You're trying to, you know, minimize your acquisition costs. Like all of these things really, you could substitute any product. And one exercise I did as part of this business coaching program was trying to nail down your. They called it your value chain, where it was. Where do people find you? How much does it cost to acquire that customer? What are you selling them? You know, what's that customer worth to you? And then focusing on one or more of those channels, like dial one in first and then diversify after that and expand out. But the thing that really hammered home was the fulfillment side. Like, if you don't have rockstar fulfillment in a great product, a great customer experience, none of the other stuff matters. Because if you have a leaky bucket down at the end, then it's like, well, like you said at the beginning, we just wasted all this money and we weren't prepared for that influx.
C
You hit on a really good point, Nick, is retention, right? Like retention, like, it costs so much to acquire. How do you retain and customer service and all those things, to your point, matters so much. And you will be amazed by. I was actually amazed by how kind people are on their emails to me because sometimes when I get bad or if I get something or not bad, I need something and I go to customer service. Sometimes that can be short. But you are. You do find that people have. As long as you're nice to them, they're really nice back. So I say when you're starting a business, like focusing on what customers want and asking them for feedback, like, hey, why did you buy this? You know, why is you. Why'd you buy it twice? I think that is something that actually, people actually enjoy getting that note. And, you know, I see that as customer experience as well.
B
More with Eli in just a moment. Including that all important retention piece and all the subtle things that Makor does to gently encourage subscription signups, plus getting on retail shelves and expanding into Amazon,
A
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B
I want to talk about this recurring Revenue element of the business. And this is really the foundation of, okay, we have 10, $11,000 a month revenue kind of as our. As our baseline. Hopefully that's our floor and it's only up from there. So I want to talk about encouraging subscriptions. So really cool to have picked a replenishable product. That is, if people like it, they're going to, you know, hopefully buy it over and over again. And it's really prominent on the sales page where the first option is the subscribe and save. And, oh, look, you save $5, you can pick regular decaf. And so it's significantly less, noticeably less than the one off purchase. And then we can save a little bit more if we add three bags to our cart. And I want to just hear how this has maybe evolved over time or what, you know, the little levers you can pull to nudge more people into the subscription.
C
So one thing we don't do, I'll say up top that every other brand does, and we're working on it with our manufacturer is like a free gift with subscription. Right early on. Like, these people have these, you know, blender, whatever it is, we're working on something there that is a really good one we don't have. But what we have found and we realize with the subscription and kind of what we've done is basically said, hey, listen, number one is explain to them what the benefits are, you know, with this coffee that it makes sense to continue to buy it more than once for your body. Right? That's first and foremost. You don't have to remember it. Number two is we show them there's free shipping on there because people don't want to pay for shipping in this world. We do that.
B
Yeah, this is. This is cool, this little comparison table. Like, here's how we compare with other premium brands. And you know, hey, look, because in my mind, I'm like, oh, 30 bucks for a bag of coffee. But it's like, well, it's really not that much because look at all that you get. Oh, I like this reframe. It's less than 80 cents a day. So you're doing a good job with that stuff.
C
The last one we put on there, the order notification, no surprises. When we put on more recently, we are very upfront when the subscription is going to happen and say, do you want to cancel or keep it? Right. Like, we do not want people to subscribe that don't want to subscribe. I think brands will do that and they'll get the extra order. But then you lose customer satisfaction. We want people to buy our copy because they want it. If you scroll if you realize how much it cost us a one time bag with we're shipping one bag across the country, it just cost a lot. So the way we can get by that with doing two and three bags because our shipping cost per bag goes down substantially with like it might only cost us $2 more to ship three bags than one. Right. So we can bring our costs down on the. So we have a lot of people who are on the two or three bag subscription because now that's back in the price range of what you're used to for a premium bag. Maybe a few dollars more. Right. So that's how we've kind of thought of that. We didn't have this other stuff at the beginning. It was just subscribe and save one time purchase. The 1, 2, 3 bag thing has been more of like a last couple months thing and made it easier for people to check out. And then we, if you see the last thing, add on only what we really want to do. Nick. And one of the things we've been thinking about a lot is like, yeah, we're a. This is our by far our hero product. But we also have organic coffee, like purity that's tested for toxins and it tastes really good. If you like a dark roast or a medium dark roast from Central America, you can get ours for $8 left in the other companies just adding on and we're trying to build that set out of the business. Right. I think Lifeboost just publicly came out on, on YouTube. So I'll say it. They're a $50 million company a year and they only sell regular coffee like this. So we do know that if you can get another bag and we can get those people, like we think that's how we think we can add more value to our cartoon, add more value to our customers who are already buying this coffee, not having to go to two different places.
B
Have you ever tested and this is obnoxious whenever I come across businesses that do this. But you ever tested just removing the one time purchase?
C
We have not tested it. I have thought about it a lot and we actually about a month ago or two, three months when we looked at our numbers, we're like, do we just remove this? Yes, we'll lose revenue, lose customers, but do we just remove this? You know, I think Kachava does that.
B
Yeah, it's the default for a lot of people. Or they make it really hard to find. Like can I just. From a Customer. It's like, I don't know if I even like this. Can I just try it? Like, I don't want to subscribe. Like, but I'm curious from the business owner standpoint, what would happen if we pushed literally everyone toward the subscription?
C
I look at this as a customer, I thought about this a lot. And as a customer, I'd be upset by it. Yeah, I think we need to show enough value to get people who want to do that and we need to have good enough follow up on marketing and whatnot to get them to come back if they forget. But I, it's not like I am not taking it off our plate forever. But like, for now, I'm like, you know what they can do one time? If they like us, they'll come back. Right? Like, they will come back if they like us. If they don't. Otherwise you lose some trial too. Right?
B
Right.
C
The one problem I have that you said though is like you, someone sees 32.95. We also charge for shipping. When you do one time purchase, it's $36 to buy one bag of coffee for us. If they buy one bag. Okay, so great.
B
Okay. So that's another way to urge people into the subscription category.
C
Yeah, Our margins are, our margins are great. But I'll tell you, if people buy $36, they're like, you know, they expect this to like be gold in their mouth. And it is amazing. It tastes like chocolate, it's great, but it is still coffee. Right. So I think people are like, oh, $36, I'm not going back to that. It's like, no, it should be, it should be $25 and that's what it should be.
B
Got it.
C
So I like your feedback and we haven't. It's not off the table for the long run, but for now it's no.
B
You mentioned Amazon is coming down the road. And this seems to be the trend where 10 years ago brands would launch on Amazon. That was the distribution, that was the marketing strategy. Like, we're going to get in front of this, the eyeballs on the world's largest store. And if we can capture just a tiny fraction of the audience there that's looking for a coffee or whatever category we're in, we're going to be golden. That seems to have shifted where now we're going to launch on our own store, we're going to launch on TikTok shop, and then down the road we're going to bring some of our existing audience and traction to Amazon. So we're not starting completely from scratch there, shouting in the dark. Talk to me about the future Amazon strategy here.
C
We initially did not want to go to Amazon because we wanted to build up a brand that people knew. Well, we have found, actually we had an agency reach out to us blindly about a month and a half ago and said, hey, people are searching for you on Amazon. Why are you not on Amazon? And they showed us some results of what people are searching for and how much business we might be losing on Amazon right now. Lots of people go on Meta, they search on Amazon. If it's not there, they say, forget it. Right. Like, it's not Amazon. I want it tomorrow. Like, I'm not buying from you. I don't know if you're a real business. Are you faking it or not? But some people are, right? Like that's a trust factor.
B
Yeah, yeah. I never heard of you before, but I trust Amazon.
C
That's exactly right. Amazon takes a large percentage of it, but they also will ship in a day. Right. They'll do a lot of really good things for you and they give you the market where your cost of acquisition. I saw some numbers, I can't say the brand, but they were $80 on Shopify to get a customer, 80 on Meta, but 8 on Amazon to get a customer.
B
Yeah. As it converts much higher.
C
Yeah. Because the customers were there shopping for. They're typing it in, they're shopping for. It's a lot easier. Not just so they're. They're ready to buy. So we realized, listen, we need to be on there. I've talked a lot of people, we're going to do it next month and we'll see how it goes.
B
Yeah, it shows up. I just typed in McCor and it shows up as the number one suggested result. So people are typing it in and so, yeah, it's like a matter of getting them some inventory or continuing to fulfill it yourself.
C
We'll get them inventory, but that's another process. Right. Like now you have find somebody who knows Amazon very well. None of this is easy, right, Nick? But it is fun.
B
Yeah. One step at a time. One step at a time. We had Chris Gray talking about his barbecue seasoning business and he mentioned something similar where it's like, yeah, we're primarily selling it through our own site, but if people are looking for it on Amazon, I don't want to not fulfill that. It's all the same to me whether they buy it through there or through us. Maybe there's different fee structure, but I'd rather make a sale than not make a sale. I think he's like, I'm not going to pay for Amazon ads or whatever yet. But it was kind of. We'll tap into this organic search factor.
C
Good point. We'll learn from our mistakes before. We will not pay for ads on Amazon until we get X number of reviews because we did that wrong on the, on our D2C brand. So we will do ads on Amazon but once we have more reviews on Amazon.
B
Yeah. We will have to do a follow up. I'm curious how the, the launch goes over there and if it unlocks a new income stream.
C
I mean, yeah. And we always learn something. Right. Like I too much would not be like what did I do? Right. But these are little risks. Right. You go on Amazon, you put send some inventory there and if it doesn't work, you know, we have been very frugal in how we thought about this. We hired somebody and one of my friends in marketing knows and gonna charge us like a thousand dollars to get on Amazon, help us manage it. Right. So we're not out there spending on all these agencies but some people can and do and it's probably faster. We have to go slow because we're not, you know, not willing to throw 50, 60, 70, $100,000 at this problem out of the gates.
B
Right. Yeah. We're not at the venture scale of just acquire as many customers as you can. We'll figure it out later.
C
This is a side business. Right. Like this is not our full time thing. So slow growth to us is also a benefit because we have a life, we have kids. As you progress, you're going to want to go faster. But sometimes slower is the right move to learn.
B
Yeah. Yeah. Tell me about some of the tools and tech that you're using to run this thing. Especially run it part time.
C
Yeah. So Shopify is definitely our main thing. We use Klaviyo from a marketing standpoint.
B
This is the email tool, like for email follow up and stuff.
C
Yeah, it's email marketing with some SMS pushing. You know we obviously have a couple design tools obviously Claude and whatnot for some ad design. And then what else do we have? Like we do actually use an offshore person, do some of our posting on Instagram, our native posting and for like $12 an hour. That was one thing we felt like we didn't. That was too much big of a time commitment for us. And I'm sure she uses some tools but it's really a lean stack. Right. Like it is Shopify. It's an email marketing tool and it's like AdWords and we're off and running.
B
What's going on on the email side. So when I go to the site I think the first time I was probably greeted with a pop up. Would you like 10, 20% off? Whatever. It was like enter your email here like every e commerce store does. Yeah. What happens after somebody opts in?
C
So when they opt in they'll get a welcome email with their discount code and then they will get a series of emails. I think it's like three or four over time basically. Hey, welcome. Here's who we are. Letting them know about the brand and you know, providing that discount code for them to for trial.
B
Okay. And then you can follow up with existing customers. Hey, your reorder is coming up or there's the Memorial Day sale is happening like that.
C
Yeah, Shopify has all these integrate. So the sales we do on Klaviyo Shopify has the tools and tech to be able to send the update. Like hey, you know actually sorry, we do use other tech. We use Loop subscription for subscriptions. So that's an add on Shopify tool. We use like something called Koala Bundles to bundle our 1, 2 and 3 bag. And these are all like you know, loops. Decently expensive. Koala Bundles I think is like $10. The loop might be like a hundred bucks a month but then they do take like a 1% fee on all the subscriptions so that you know, that adds up. But they send out the emails and then we use actually Shipstation so there's more tech than I thought. We use Shipstation for all the to get our cheaper pricing on packages. You could use Shopify Pack anyway Fulfillment that all integrates together to let people know it's coming and then where it's tracking and then they get updates on their tracking as well.
B
And did you say your manufacturer was doing the fulfillment for you when the orders come through?
C
That's correct.
B
So where's your time going these days outside of the day job and parenting and all that stuff?
C
A lot of it's going into retail. So we have, you know, I can shout them out because they're great partners. Kowalski's and Lunds and Byerlys in Minnesota carry our coffee and we work with the distributors for that. So now that we work with these distributors and they've taken our coffee in, they have other retailers that they sell into that now I'm focusing on calling into those retailers to be able to tell them hey, you know your, your distributor carries our coffee. We'd Love to come in and taste. I'm trying to expand retail pretty well because I do think, like, you know, a bag of coffee in retail is profit every single time to us. First time. Even though we make less of a profit by far because of all the people involved.
B
Yeah.
C
It's still a profit every time. So you have to scale that. That's like, you have to scale a lot to make money. But we do know we'll make. Make a dollar if we. If we sell a coffee.
B
Okay. This is another interesting channel that I completely missed was some people buying coffee online. Great. We can acquire them through these different ad channels and influencer marketing. But some people buy it in person, and they find it at the local coffee shop. So the distributor is not marketing on your behalf. So you have to find out who they already distribute to and then be proactive.
C
They'll tell us the companies they distribute to. They will take our sell sheet into their meeting, say, hey, we have this coffee. But they. They have lots of brand. Yeah, they're not our sales team, but they will open the door for us by us having that warm introduction. Hey, we sell into this group, you know, they won't tell us the name of the person to call, but they say, you know, it's the coffee buyer. Right. Like, and then go after that. So that is. That's where I'm spending a lot of my time. And then we do demos and tasting sometimes, too, to make sure people can taste our coffee. And, you know, we try to help the stores sell it because we want to be kept on the shelves. It's definitely two different businesses completely.
A
Right?
B
Yeah. It's one thing to get the initial foot in the door, the space on the shelf, but then you got to move it, and hopefully people keep coming back for it.
C
Right. And we are not self distributing, calling grocery stores ourself and like, oh, we'll bring this to you. And, you know, we'll take the distributor's margin. We'll be our own distributor. Everything we're doing is like, yeah, we're losing margin, but it allows us to live our lives and have this on the side still. The moment that we say we don't want to work with the manufacturer or distributors, the moment. This is 10 jobs. Right.
B
How many brick and mortars are you in? How many retail locations are you in?
C
It's like, 46 stores.
B
Wow, that's great.
C
Yeah, it's great. It's really great. And it's fun and it's nice, but, you know, that comes with more challenges. Right? Hey, we have a PO for you. We need this sitting here in seven days to be picked up. And I'm like, oh, goodness, I don't have enough bags. I need to go call the bag company to make sure I have enough bags in time. And I'm gonna go pay a premium because I wasn't ready for this P.O. because I'm thinking about other, you know, so there's a lot of things when you start scaling that and for the first time that you don't know. Right. So it is great, but it comes with challenges. But you know, Nick, you talked to everybody. Like, the reason we're in business, in life is to solve these challenges and like, otherwise we'd be bored all day.
B
Yeah. If it were easy, everybody would be doing it. No, that's really cool. So that's a significant piece of the distribution puzzle. Like in addition to all our online stuff is, well, hopefully we get more shelf space and just customer awareness locally that this is a premium brand of coffee. And hopefully we get some people buying, buying that and maybe they come online and become a subscriber there.
C
I would love our online and to your point to be a subscription only place. And people want one time they go to Amazon. Right. That's faster, it's easier for them. Go to Amazon for your one time all lose margin. But it'll be a better customer experience. Keep subscriptions on our business because you'll get it all the time and then make the retail even bigger than it is now. Like, that'd be the dream and I think the best customer experience for everybody.
B
Yeah. Well, I'm excited to see where it goes. What else does the future hold for
C
Makor at some point? Potentially more flavors. Right. We focus on anti inflammation. Our. Our mantra is whole organic food always. So you have these companies that are doing enhancements. They're great. They do what they do. You know, they add additives, they, you know, they, they add science, they add creatine with color, all that stuff. We are focused on whole food ingredients in our coffee. Always tested for toxins and mold. Always organic. And the next day up me like, yeah, do we have some sort of protein coffee from whole food ingredients or do we have a heart health coffee from whole food ingredients. One thing I do want to say though is we are not a supplement company. We never intend to be a supplement company. We want to be a company that is, you know, a health food company that people can start their day knowing that they're putting the best thing in their body every single day and not Forgetting about it because it's coffee and they're getting these spices that they would never get otherwise or they'd get very limited out of it. So it's just an additive to their day. But we are, we're not trying to be the next, you know, IMH or whatever it is, like as a supplement. We're trying to be a coffee company that can help people, help people live. Yeah.
B
It plays into this gold rush of anti inflammatory, even biodiversity of like, oh, you know, look at all these different ingredients. I'm getting all at once in the
C
whole food form too. Right. Like, we're not just taking pieces of it out. Yeah, we're trying, we're trying our best. And you know, our customers really love us. They tell us they do. And it's been very enjoyable. Right. It's been a very, I guess the side hustle thing. People are listening. Like it is an enjoyable ride and if you outsource a lot of the things, it can be enjoyable and also not take like every minute of your day up. I would say just focus on outsourcing as much as possible, as much as you're willing to.
B
Any big surprises along the way?
C
Tons. I mean, I didn't expect meta cost to be so high. I didn't expect our coffee to not go through a filter as fast as regular coffee. The amount of effort we've put into machines and testing and all these things to make our coffee be as close to regular coffee and how it's brewed as possible has been a monster challenge. And then customer service people are asking lots of questions that they have the answer to online. Right. But they just want to email. Hey, can you tell me, can you do some of my subscription? Yeah, here's the link. But no, I'll do it for you, of course. Right. So just things that take me away that, yeah, you know, I expected, I guess, but didn't know the extent of it.
B
Got it, got it. Well, it's been exciting, Eli and I appreciate your transparency and like both the good side and the challenges that come along with, with running a physical product business in this category, you so super cool. McCor coffee.com we'll link that up in the show notes. If you use promo code side hustle, you get 25% off your first order. So give it a try again. McCor coffee.com Eli, let's wrap this thing up with your number one tip for side hustle nation.
C
Will do. And if you want to reach out to me, McCor Coffee and Instagram, I do read them all. So I'll respond if you have questions about anything we said. Like happy to have a dialogue. The number one thing I will say is know your numbers and choose a product where the margins will allow you to stay in business. You have to have margins if you're shipping things online that either people are repeating as customers. So always think about the AOV of a cart and the long term value, how many times they come back critically important, something I didn't think about enough as I started.
B
That's right. Hopefully there's some margin to play with in between there because if there's not, then you're kind of host right out of the gate.
C
100%.
B
I love the replenishable element to this encouraging the subscription business, knowing your margin, trying to find kind of the intersection of different worlds that you're already a part of that you already know. Like oh I know anti inflammation, I know whole foods and wellness and how do I blend that into kind of a daily habit that, you know, people can consume over and over again. I think it has the potential to be a really cool business. So I think we're catching it on hopefully the early side of it, just a year and a half deep. So again, mccorcoffee.com I've got a free listener bonus for you this week. It's a big list of 50 other replenishable product ideas. If you're going to sell something, you might consider selling something like Eli does, a product that gets used and customers need to order again and again. So this list will help brainstorm some of those ideas for you. And I've linked up the relevant archive episodes where applicable. Like we had Chris Gray his barbecue seasoning business. We had Connor Meekin with his bone broth business, I think organic bone broth business. So be sure to grab that resource. Just hit the show notes or the show notes link in the episode description and it'll get you right over there. You'll be able to download that for free. Big thanks to Eli for sharing his insight. Thanks to our sponsors for helping make this content free for everyone. Side hustlenation.com deals is where you'll find all the latest offers from our sponsors in one place. That is it for me. Thank you so much for tuning in. If you're finding value in the show, the greatest compliment is to share it with a friend. Fire off that text message, let them know they should check this out. Until next time, let's go out there and make something happen and I'll catch you in the next edition. Of the side. Hustle show Hustle on the.
The Side Hustle Show — Episode 744: $11k MRR from our 1-Year-Old Side Hustle
Podcast Host: Nick Loper
Guest: Eli Mash, Co-Founder of McCor Coffee
Date: June 15, 2026
This episode dives into the first-year journey of McCor Coffee, a premium anti-inflammatory coffee brand co-founded by Eli Mash. Eli shares the realities of launching a physical product side hustle: achieving $100K in year-one sales, now at $11,000/month in recurring revenue. The conversation covers everything from niche differentiation and manufacturing deals to subscription strategies, influencer campaigns, and the retail vs. D2C balance. Actionable details abound for listeners curious about launching and scaling a replenishable product business.
[04:15–05:28]
[06:28–10:38]
[11:26–13:56]
[01:19–03:51, 13:56–14:45; 34:32–38:45]
[17:47–21:14]
[22:27–28:25]
[28:39–29:40]
[30:32–31:18]
[45:55–47:11]
[42:32–44:48]
[39:30–41:45]
[50:10–50:48]
Closing Resource:
Nick offers a download: “50 Replenishable Product Ideas” for listeners thinking about launching their own subscription-based product.
#1 Tip for Side Hustle Nation (Eli, 51:15):
“Know your numbers and choose a product where the margins will allow you to stay in business…critically important, something I didn’t think about enough as I started.”
Find Out More:
(End of Summary)