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This past summer, I took my family to Vienna. It was incredible. We spent our days wandering the old streets, stopping for coffee and pastries, visiting museums and just soaking up the history of one of the most beautiful cities in the world. And one of the things that made the trip so special was the home we booked on Airbnb.
It had tall windows, beautiful old details, and plenty of space for all of us. And being in that home on Airbnb right in the middle of Vienna, walking distance from so much of the city, made it feel less like a visit and more like we were actually living there. Plus, taking a trip is the perfect time to host your space on Airbnb. Your place, with all of its personal touches and its amazing location, can make someone else's vacation even better.
Your home might be worth more than you think. Find out how much at Airbnb ca host. Hello and welcome to the advice line on How It Goes Lab. I'm Guy Raz.
This is the place where we help try to solve your business challenges. Each week I'm joined by a legendary founder, former guest on the show who will help me try to help you. And if you're building something and you need advice, give us call and you just might be the next guest on the show. Our number is 1-800-433-1298.
Leave us a one minute message that tells us about your business and the Issues or questions that you'd like help with. Alright, let's get to it. Joining me this week is Mark Cuban. He's of course a legendary serial entrepreneur best known for his early software streaming companies and then as the owner of the Dallas Mavericks and one of the sharks on Shark Tank.
Mark's invested in tons of startups and early stage businesses to revolutionize the prescription drug market. Mark, it's great to be back on the show. It's great to be back. Thanks for having me.
Kai, you were first on back in 2016. You were one of our very first episodes actually almost nine years ago and just some amazing story. If you guys haven't heard that episode, go back, check it out, we'll put a link to it in the episode description. You have had an incredible career and I have to repeat a piece of advice you gave on that episode nine years ago when I asked you what you would do if you lost it all and you start over, what would you do to start up again?
Do you remember what you said? I think I said I'd be a bartender at night and get a sales job during the day. It's exactly what you said. It's incredible advice because you get tips, a bartender and then you got a daytime to sell.
Yeah, I mean you got to lean on your strong skill sets, you know. And for me, bartender, it has to be a shot in a beer type place, not a fancy place because my skills haven't kept up with the changes. But at the same time I know how to sell and anybody who knows how to sell and is willing to learn and is curious can get a job and can achieve success. Mark, you came on a couple years ago, talked to us about Cost plus Drugs.
This is basically your business designed to change how prescription drugs are priced and accessibility. You actually built a production facility. Now you're making prescription drugs. Correct.
We have a robotics driven manufacturing facility in Dallas, Texas and we're making sterile injectables. Right now we're focused on drugs that are in short supply. Believe it or not, in 2026, things like pediatric cancer drugs still go in short supply. So we're solving that need for hospitals and we're looking to expand it to everything so that there's nothing we can't make.
So many generic drugs are made overseas. What's the biggest challenge in making them here? I mean you have a facility now, it's taking you a couple years, but why is it so hard to do it in the U.S. you know, that's a great question and a timely Question.
I'm glad you asked. It's not hard for, because we're robotically driven. We can change the drug we're making in a four hour period. You know, so we can make a one month or one year supply of something, then roll it over to another drug.
Our biggest inhibitor and why we haven't done it yet is all the fees that the FDA charges. So it's about $365,000 to set up what's called an and undo drug application. And if you want to do it for 100 drugs, that's $36.5 million you want to do for a thousand generics. You can do the math, right?
And so because of that, that, that is what ruins the margins here in the United States. And so we can make generic pills here in the United States cheaper than what we can buy them for from India or China. We just have to deal with the associated cost of all the applications. So how do you solve that?
I mean, it sounds like this is a legislative solve, like you basically change the law. Well, actually it's an FDA issue. You know, they have the opportunity to waive those fees. And we're talking to people in the fda, obvious they want to bring manufacturing back home.
They want to prove that we can compete in manufacturing in the U.S. hopefully we'll get, you know, a positive response from the head of the FDA, because once they do that, it takes us about 12 months at the most to start turning everything on and then there's no limit to what we can scale. And the reason we're able to do it so much more effectively is not only because of the AI robotics we use, but because we did it on a modular basis. Literally.
We can put all this stuff in a tractor trailer and not only make it in Dallas, but take it wherever and manufacture the drugs as close as where they need to be. The idea behind this is essentially to boil down is to make prescription drug prices lower, right? Like significantly lower. I mean, to do that requires a lot of upfront capital.
And you've mentioned this in the past, which is if you just break even, that's great. Like you don't need this to be a billion dollar business. You don't need to walk away making tons of money. So I think I know the answer is.
But what is it? What is motivating you to like spend a considerable time of your energy on, on this business? Everybody hates the economic side of their healthcare. Everybody.
I want to fix that. And when it's all said and done, some people be happy to have their names on buildings. I want, when it's all said and done, he fixed health care. Now whether or not I'll get there, who knows, right?
But having that as a mission, I mean, to me it's fun. It fills my competitive juices, it keeps me motivated. You know, I'm the very curious type. I'm always having to learn.
I'm reading hours a day on how the whole medical system works and where the problems are and where the opportunities are for change. And I'm able to connect all these dots, which is really my skill set. And we made a lot of progress. I mean, we've saved lives, We've saved millions.
We've made millions of people happy, let's put it that way. And we're changing an industry and we won't stop just with pharmaceuticals. We're working to get into the medical side as well. Awesome.
All right, Mark, let's take our first call. You ready? Great. All right.
Hello, caller. Welcome to the advice line. You are on with Mark Cuban. Tell us your name, where you're calling from, and just one line about your business.
Hi, guys. Hi, Mark. I'm Lucy. I'm calling from Washington D.C.
and I am the CEO and co founder of One Trick Pony. We are flipping the peanut butter aisle on its head, quite literally. So we make two ingredient delicious peanut butter with this. Organic peanuts and salt in our custom upside down jars designed to help you fight the oil separation and natural peanut butter.
Awesome. Thanks for calling it so, Lucy. One Trick Pony peanut butter, peanuts and salt. But it's an upside down jar.
Can you like explain that? Sure. So it's natural peanut butter. So just peanuts and salt.
Which means that there will be that oil separation that everyone hates. So the jar sits on the grocery shelf upside down. So the oil is rising to the top of the jar when it's sitting and then when you bring it home for the first time and flip it over, the oil will actually be on the bottom of the jar. So you're not met with that oil when you open the jar and you're like, you know, flashing over the edges on your first open and just really?
How did you start? How did this start? Yeah, so we are family founded business. So I started this with my brother and my sister in law.
My sister in law is from Argentina. So we were in Argentina for their wedding. We were doing what we do on vacation, which is try the local peanut butter wherever we go. And we were just blown away by the taste and the texture of what we were trying.
So came home, did Some research realized that peanuts are actually indigenous to South America. So it's like the original climate where they're supposed to be grown. And we kind of looked at each other and said, hey, should we start peanut butter company celebrating these peanuts? And here we are.
And what give us a sense of what you guys are doing. Like what are we doing sales this year? Yeah. So we actually launched in November 2022, but we were in different jars.
So we were just in like, you know, off the shelf jars. So our first couple years it was going okay. We were, you know, like in the low hundreds of thousands. And then we just launched this new jar in July this year after talking to a bunch of customers and kind of hearing this pain point over and over.
So this year we're hoping to finish out at a million in revenue. Amazing. Okay, congrats. And before we mark in because we have a lot more questions, what is your question for us?
So so far in retail we've only launched in natural grocery stores, kind of like the whole foods of the world where we're on the shelves next to other, you know, premium organic products at high price points. And next year I have the opportunity to launch at a big box retailer, one where we'd be on the shelf next to more conventional products and also targeting a more price sensitive consumer. So my question is, how would you approach this opportunity to succeed in this new channel while also maintaining what makes my brand premium now? All right, Mark, you want to bring you in questions, thoughts, comments for Lucy?
Sure. So you said this is the family business. Do you have other peanut butter based products that your family sells? So we have three mean skews, smooth, crunchy and unsalted.
And we do some seasonal drops. So you don't have any other products that you're selling? It's only peanut butter based products. That's important to know because you can't leverage other products.
Number two, to get into the bigger stores, you're looking at stocking fees. Right. And so the big question is how much are they going to charge you for those stocking fees? It's going to cost you a lot of money up front.
So this is where you have to do your budgeting and decide whether or not you're willing to go all in. Because I like the look of it. It obviously is going to stand out. It's something completely different.
Peanut butter looks primarily the same across all the other products. So you're going to stand out. I think people will be okay with paying a premium, but you have to do the math. In your own budget in terms of whether or not you can afford the stocking fees and advertising and promotion to sustain that.
Are you doing any advertising or promotional stuff now? Yeah, we do meta ads right now. So we are only channel. So we sell on E commerce and also in retail.
So what's the majority of your sales right now retail? It's 50, 50 actually. And what about your margin dollars because of the cost of shipping, how your margin dollars play out? It's a little better on E Commerce right now.
Kind of what you're saying, our margin when we go to retailer, the distributor takes a fee. Exactly. Okay, so in terms of that, so you've got return on ad spend. So here's what I'll tell you.
The biggest mistake startups make is chasing sales over margin dollars and profits. Because there's internally we all want to get to that hundreds of thousands, then up millions and then five millions. And then you're hoping once you get to 10, 20, 50 million, either you're making a ton of money or you're going to get bought. And so the challenge is trying to rush it there without enough capital.
So people will take the money that they have, spend it all in stocking fees and advertising, say look, our numbers are going up but then your self room, your turns are maybe as good in certain stores and you're fighting a battle to stay on shelves. What I will tell you is take your time. What you've got to do is make sure that where you're at, you are selling through. If you can't sell through based off of the advertising that you're doing, it's not a bad thing just to go straight E commerce because you can take all the money you're giving that distributor, you can take all the money in stocking fees that you're giving to Whole Foods and whoever, right.
And put that into advertising. And if you're getting you know, a two plus return on ad spend, which I'm guessing you are, right. Then you know, if you get that up to three or four, you're killing it. And then you also have some more money to give to influencers, right?
Because every now and then when an influencer says something and say oh how cool it is, hey watch me as I open it my you know, peanut butter and you know, smell it and say it's not gooey, that's when you get up in sales, right? So moral of the story is don't chase sales, chase profitability, particularly because this is a family business. I'm assuming you have not Raised a lot of money. We have raised a seed fund to fuel our, you know, early retail growth in new jars.
Is that mostly friends and family? No, we raised from a VC last summer. So we did raise our like a institutional capital last summer. And then also, you know, from what percent of the company do you still own?
All of us together a little over 50. Okay. That's important. Yeah.
You're stuck. You're in a really tough place right now because if you chase sales, that's part of what the VC wants. Right. The VC want you to chase sales because they want to get an exit to get a return on their capital.
You, on the other hand, if you can't get the return on the capital you already have in the bank, then you're going to have to raise more money, which is going to take you under 50% and that's really bad news. And so don't tell your VC you're on guy show. And if they do tell earmuffs, because what I'm going to tell you is to ignore your VC no matter what they say. Okay.
If they tell you to chase sales, ignore them because they'll be right in saying this is the only way to get huge. But you don't want to be in a position where you lose control of your own company. Yeah. Caveat.
They are very supportive. They don't say Chase. They're in a long haul. So.
Yeah, I don't want to get the wrong idea. It sounds, Mark, like what you're saying. Many brands on the show have had opportunities to target a Walmart and have waited some for years, three, four, five years. That opportunity, it will be there.
But you've got a premium brand. You're not going up against Jeff. And you know, in the mass consumer brand, you're going up against the Justin's, you know, so you want to look at like what other premium brands have done in the past. RXBar, for example, which is on the show.
And if you can really focus on that premium promise. Right. Which is what sounds like what you're doing, that's really where your advantage comes in. Yeah.
And you don't have to rush when you've got a great product. Yes, I'm knocking you off. They're gonna knock you off anyways. But if you've got a great product and you build a fan base, because the thing about peanut butter is people reorder it, you know, and if you build up a really committed customer base, just keep on doing that and you'll just see as long as it's going up to the right.
And as long as your cash account, your bank account is growing, you're way ahead of the game. Your stress level goes down, you know, because you're already dreaming about work every single night. All you do is think about peanut butter and everything related to peanut butter. And so when you do that, you wanted to do it without your heart pounding a thousand miles an hour.
You want to, you want to do it just thinking of great ideas and being innovative. And then you can take that time and go out and reach out to influencers and brings you even more attention. And so you're on a great path. I agree with you.
Well, one quick question. Your jars are opaque and peanut butters often. Jars are often clear. Would it make sense to try a clear jar because you see the oil at the top?
Yeah, it's one of the gambles we took when we designed it. Just with the manufacturing process, we had to make them opaque and I thought people would really push back on it. And we actually haven't heard anything about it. So what he's saying is an opportunity.
What you might want to do is look at the cost and just try it to see if there's a difference in sales because. Right. Anything that differentiates you even a little bit, to get attention on the shelf without costing you too much. And so I'm sure there's a difference in cost, but it may be worth.
I think I need to hit the nail on the head. It may be worth doing a see through version where it's just see through in the top. You know, a little peekaboo. Peanut butter could be cool.
New tagline. Yeah, could be cool. Lucy. Dan.
The brand's called One Trick Pony. Congrats. Good luck keeping you. Well done, Lucy.
Thanks. Yeah, I mean, it's super cool, super amazing. Totally different way to think about it because they say, you know, there's a lot of competition in people, in numbers for sure, and you gotta find a way to stand out. But yeah, you know, the key is don't rush.
Yeah. Just take your time and get it right. Nobody ever gave awards out just for having a lot of sales. Right.
And a lot of brands have gone out of business by going into Target and Walmart too quickly because they give you one shot. Yeah. So many companies have, you know, people just get all excited thinking, okay, this is validation. If I get into Target, if I get into Walmart, if I get into Whole Foods, that's validation that this is great.
And they presume that being on their shelves is going to Generate a ton of sell through. There's a ton of products that are long forgotten that used to be on that shelf before you. And you have to always remember that. All right, we're take a quick break but we'll be right back with another color and another round of advice.
Stick with us. I'm Guy Raz and you're listening to the advice line right here on how I built this lab. Welcome back to the advice line on how I built this lab on Guy Raz. And my guest today is the legendary Mark Cuban.
Mark, you ready for our next call? I'm ready to go. Welcome to the advice line. You're on with Mark Cuban.
Tell us your name, where you're calling from and just a little bit about your business. Hi Mark. Hi Guy. My name is Macy Schmidt.
I am the CEO and co founder of Earlier Skincare. We are based in Provo, Utah and we are a youth safe skincare company for teens and tweens. Awesome. Welcome to show.
So what is what does a youth safe skincare company. Yeah, so we have a three step system of cleanser, moisturizer and sunscreen. These three steps are all that dermatologists recommend teens and tweens have in their skincare routine. So very simple.
And all of our products are youth safe. So that means that we don't use hormone disruptors, anti aging ingredients like retinols, no fragrances, just very clean and gentle products for developing skin. And so are teen and tween girls using products like that you mentioned? Yes.
So that is actually why I started this company is because when I was in my senior year of college I heard about Sephora twins. I don't know if you've heard that term but it was all over social media in the news of these 12 year olds even this time is eight going to Sephora and using retinols and all these anti aging ingredients that were harming their skin because their skin barrier is developing and they can't be using those really harsh products. But they were pink and they were on TikTok so they wanted them. What did you guys watch?
So we are still in our first year of business. We launched with our full product line this last May. So still very nice. How have you done so far?
Sales. So it started out slow. It's picked up a lot the past few months as we started going to events around Utah and then the end of the year hoping to end around $25,000. Great.
And before bring marketing. What's your question for us? So my question is marketing. We have a Unique marketing landscape where teens and tweens are our users, but our purchasers are mainly their parents or the adults.
So we have been struggling with this question of where do we allocate our marketing dollars and do we put it towards trying to reach those teens or trying to reach the parents? All right, so Mark, the parents are making, they're buying the thing, but you really gotta reach the tweens because they're the customer. This is a cool idea, right? Skin care for younger skin.
When these Galazi girls are buying products that are really for older people. Yeah, as a two girl dad, I can appreciate it all. And I've been to Sephora with my husband and my daughters. Not even her, she was 19 or 20, but everybody else walking in the store, it's eye opening, but you know, where are you selling it right now?
So we're just selling on our website, directing consumer and reaching people, mainly through social media. We kind of answered your own question, who should you market to? Because kids typically aren't going to have credit cards and they care more about the brand and what it looks like and how they're perceived than even the actual skincare. Right.
They want to know they have Kylie's brand or whatever. Right. And so they want the pink color like you mentioned. And it sounds like you're doing, are you going to flea markets or are you going to events or where are you going to right now?
Yeah, like expos. Small, small business markets, things like that. I think you want to go and set up wherever you can reach parents and particularly if it's a place where they can bring their kids. Because your whole sales pitch is education and your education is really a fear based education.
You're scaring the heck out of a parent for the most part. Because kids are fearless at that age. Right. I mean, we all remember how we were.
And while it may seem like slowness, you may be able to go to one flea market and set up over a couple of weeks and start, you know, get to where you're selling 5,000 a weekend and 10,025 and make sure you collect all emails and make sure you collect all credit cards and all that so that you. We sell them. But that's really where you have to go to where you have to start. All right, so let's talk about a farmer's market, for example.
Can you do two versions of two different things at the same time? Right. On the one hand, parents want safety. Right.
The parents are gonna be attracted by the gentle formulations and, you know, all those Things you're talking about. The teens want, like, the get ready with me videos. Right. They want, like, the pinks and the fun and the trendy stuff.
And so can you, like, set up that kind of fun demo, but also, you know, really target that safety message in the same booth, but sort of in a way where the teens don't really see or care about it? Yeah, and that's what we've kind of been doing so far. So we've noticed that when we go to these markets, we get two different, you know, responses. Either the mom's like, oh, my daughter's starting to see some pimples.
I really want to get her into skincare. Or we see the young girls that think this is so cute, and they're dragging their moms and saying, mommy, mommy, I want this. So that's why we're kind of juggling with the. Do we reach out and get those girls that are all over social media and try to go viral on social media and go that way or straight to the parents?
No, because we're 25,000 in sales for the year. You're still trying to figure things out, and you're iterating all the time and learning, learning, learning as you go. So you don't want to spend any more money than you have to to go through that learning process. Once you start getting some education about your customers and also about what their rebuys are.
Right. Do they buy again and how long before they buy again? And can you build up a database of email lists? You have to go through that process.
And so don't get too far ahead of yourself. There's still so much you have to learn about your products, the response to it. The good news is the margins are huge. Right.
You know, and you even have to understand the best way to price it. It may well be you're underpricing it because you think, you know, well, girls can't afford, you know, but mom's gonna afford a little bit more. So we'll price it in the middle. Well, depending on the response you get from the parents, if they're so convinced that this is so important and it's, you know, an imperative for them to protect their daughters and their skins.
You may be underpricing it, but these are the things you need to learn. Yeah, I'm looking at your prices in there. I mean, 18 bucks for a bottle is a pretty great price. $49, the whole package, which is three bucks.
Three bucks. Your branding, by the way, is terrific. It's great colors, really simple Clean. But I do have a question about paid marketing for a moment, Mark, because even with 30 grand in sales, Right.
Is there a world where she could experiment with even $5,000 or $3,000 or $2,000 in some, which she's selling right now, though it's hard to do paid marketing. Even $2,000 is a lot of money right now. That's the issue. So when you're starting like that and you know, there's one path, the flea markets are in person marketing, where you do a great job and it's you and probably the other people in your family, maybe a cousin, a sister helping you.
Right. So their time is basically free. And so I would build up until I got to the point where my cash was growing. I had repeat customers.
They, you know, I Knew I had 15, $20,000 a month, and 15,000 of that was margin. Then I could say, because I have this base of cash revenue, let me experiment with $5,000 and see what happens. The challenge in doing that is there are so many skincare products out there that when you go on Meta or any of the platforms, you're competing to get the best slots with all of them, which means you're paying a premium. You may be better off advertising on Nextdoor than you are advertising on Facebook.
I don't know. But that's. But you want to build up those repetitive sales so, you know, because the stress is real. Yeah.
My first business, microsolutions, I remember thinking, I got $15,000 in the bank. Oh, my God, I can eat. You know, I've got 25,000 in receivables. If I collect these, I'm good.
I can pay my. You know, and so you want to do things that put cash in the bank, where you can control your own destiny as much as possible and go into the flea markets or wherever you can set up. Then you can say, okay, now we can replicate what we're doing and go to two of them at the same time. And then that turns into three, then that turns into four, and now all of a sudden, to guys, point, all right, we're making $25,000 a month in profits.
Let's experiment with a bunch of different sites and see what happens. Awesome. That's great. Thank you so much.
Thank you. Macy Smith, the Rental Girls, Skincare. Good luck. Thanks for calling luck, Macy.
Thank you, Mark. Thank you, guys. We do a lot of cosmetics on the show. We've had.
There's a brand called Drunk Elephant, as you may know, huge brand. And that's become. Was not designed for teen and teenage girls, but it's become huge because of TikTok. Yeah, you just never know.
Sometimes something can fall in your lap and that's always a good thing. But again, you got to always remember sales are important, but the cash that they generates is more important when you're just getting started like Macy and Lucy were. Stay with us because after the break we'll talk to another founder working to take their business to the next level. I'm Guy Raz and you're listening to the advice line right here on how I built this lab.
Welcome back to the advice line on how I built this lab. I'm Guy Raz and today I'm taking your calls with Mark Cuban. And let's bring in our next caller. Okay, welcome to the advice line.
You're on Mark Cuban. Tell us your name, where you're calling from, and just align. Too much business. Hi, I'm Dan Jansen from Raleigh, North Carolina.
I run Imperium Shaving and we handcraft luxury razors that pair with leading blades like Gillette. Dan, welcome to the show Imperium Shaving. I just opened up your website and wow, these are beautiful wooden razors. Tell me the story.
You're carving these yourself? Yeah, well, they're all turned on a lathe and started in 2016. I was looking around my bathroom that I had recently remodeled and I said, everything in here is plastic. Everything in here is ugly.
I've been a woodworker since I was, you know, since I could breathe pretty much. And I said, I can make things in here. So I started, you know, made a cabinet, made a bench, and then I made a razor. And some friends saw it.
People used my bathroom when they came to visit and off to the races after that. I love it. It looks like my grandfather's razor. They're just beautiful.
And do they fit with like Gillette razors or Harry's razors? Well, not Harry's, not Harry's yet, but some of them. Okay, I got it. And Gillette's still the best selling.
Make sense. And so you starts in 2016. Okay, and how is business going? Well, business was going great.
So from 2016 till 2020, the first year was slow, obviously bootstrapping. I was working another job. Then 2017, quit my job. 2018 grew even more.
2019, hired some people. 2020, I had six people working for me. And then the pandemic hit and business pretty much stopped. What were you doing like roughly in sales when that happened?
Well, in 2020, we were set to make about half a million dollars. Wow. Okay. Pandemic hit.
And what happened? It just. Since then, it hasn't recovered at all. Well, when the pandemic hit, just for instance, typical month in sales, 50,000.
Let's say when the pandemic hit, we had $300 in sales, so. And we had a shutdown order in our city. So all my employees went home and got unemployment, as they should. But I had to pivot immediately.
I had no money. I had to pay all my bills. So I started a mass company with some friends. We turned that into an N95 factory, and I ran that for two to three years.
I think we're the only factory in Maryland. I was in Baltimore at the time, working about six, seven days a week. And then deep stuff by max. Yeah.
So then I had to decide, do I go back to do razors and I have no team? Which is sort of my question. Yeah, please, go ahead. Go.
Yeah. So I scaled once the pandemic put the brakes on it. Now I'm in a new city. I'm all alone.
I'm in solo founder mode. What do I prioritize over the next six months so that I can grow again? I love this, Mark. These are.
I don't know if you can see. These are beautiful wooden razors. And, yeah, they're going for, like, 80 bucks all the way to 100 more. These are really beautiful piece of art.
So let's jump in. Questions, Dr. Dan. What got you your original sales?
Up to $50,000 a month, Dan, Was it all word of mouth, or how were you acquiring your customers? I was doing everything. So I was going to craft shows, I was going to networking events. I was reaching out to people, cold calling people.
I was walking into stores. I got into Whole Foods, three Whole Foods, just by going into them, talking to them. What city was that? Baltimore.
Baltimore. Baltimore. What city you were now? Raleigh, North Carolina.
Okay. And I'm guessing you could probably do the exact same things, right? Started that process. I have.
I have. So I've been networking. I go to a business networking group every Wednesday, and I make contacts and I reach out, but it's hard. You know, I built two businesses over the past 10 years.
I feel like I'm starting over. And sales are strong. They're not 30, 40, $50,000 a month strong, but they're strong. The problem is I'm one man now, so I sort of had to scale back, put the brakes on it.
No. Advertise exactly what you need to do. Oh, please. Yes.
Raise your prices. A lot. Okay. Because you do custom work.
You're the artist that makes it happen. You're doing the actual woodwork, I'm assuming, still. Maybe not the lamination, but most, almost all the creation. Right.
I do everything 100%. Everything. 100%. You're not selling razors.
You're selling Dan. You're selling your creativity. You got to change the name from Imperium Shaving. You can keep that off your website.
It's Dan Jansen Shaving Dan Janson Custom Razors. I like it. I love it. You are the maker of beautiful things.
Maybe a French accent, you know, or German accent, you know? But you get my point, right? You know, because you are an artist and that's what you're selling with any piece of artwork. The more expensive it is, the better the perception of it is, right?
And that's what you have to sell. What is your typical high end, high send razor? What's your most expensive? The most expensive that we have is called the tower, and it's something that I invented.
It's basically a block of wood. And then I'm matching a razor made out of the same block of wood, and it stands upright, so it floats. And what do you sell it for? 500.
Okay. So that's cool, right? So you're not super cheap, right? On your pym.
What's your typical one? Your average sale, it's about $90. And what does it cost you to make? It depends.
So we make them out of metal, wood, and stone. The stone ones, they cost me anywhere up to $50. The wooden ones, I can make for about 25. Okay.
You've got to do at least 300% margins on everything. Right. Way back when I first got into the computer business, there was an advertisement, and it was by this company called Epson. And this guy comes on and says, your printers are way too expensive.
I can't believe you're trying to sell this printer for $2,000 when the Epson printer is only $49 and the other guy comes on and says, all I got to do is sell one. That's right. And that's where you are, right? As long as your margins are high enough and you know your customer base.
So, hey, ask me about the Dan Jensen Custom Razor. $3,000. It starts at $3,000. And we'll customize it specifically for whoever you want.
It'll be the most beautiful razor they have ever seen. Guaranteed your money back. If you would like a custom one for your husband, your daughter, your wife, your son, your grandpa, I will customize it in any way, shape or form. Ask for a custom quote.
Do you guys do that now? So it's funny, I was going to put something up last week. I just haven't had the time with custom materials, customization and use really exotic materials like fossil and meteorite. It's not even about the materials.
It's about your creativity that is the value here. It's not the rocks. It's not anything else. It's what's in your head that you've learned over those 10 years.
And that creativity you always had as a woodworker, that's what you're selling. I love it. Okay. I totally agree.
Your story is your most valuable asset and I think you can really lean into that on your website. You show the lathe, I show more of that. You want the process wood, the tools, your hands, you know, your story is the product, right. You are making a one of a kind product.
One of the thought I had, we had a couple years ago, we featured the brand Jack Black, which actually started in Dallas. Mark and Jeff and Karen Danderan, they basically made a premium men's, you know, shaving lotion products. But the way they started was at golf clubs. They went to golf clubs, to the locker rooms.
Now, you know, I wonder whether you may want to try doing something like that. Maybe a custom branded razor that they could sell at the gift shop at the golf club. That's where you're going to find the kind of men. Right.
Because most of the buyers are men who have money, who want to have this beautiful product in their bathroom. You know, hotel resorts as well, I would think would be an interesting place to try and get these in their gift shops with the logo or the name of the hotel on the handle, something like that. Because that those are the people who are going to, who are going to buy this product. That's a great idea.
Yeah. I had two things, Dan. One, there are companies and people who specialize in corporate gifts. You make corporate gifts.
So I would focus on those. And then, you know, the morning TV shows, the Good Morning Raleigh and all that kind of stuff that are on the network. I would go to them and say, hey, I want to come on here, I want to make one. I'll bring my lathe and we'll make one for one of you or each one of you.
Right. As long as you just let me promote this as a Christmas present. That's a great idea. You should do that now.
And how many people are making this in Raleigh, North Carolina? I Think a lot of these local TV news want to feature people. Local people are making stuff in their town. Oh, yeah, that's.
And we actually did that in Baltimore. Had the news come out two or three times to my factory. Yes. And you're right.
I should do that now. Yeah. Podcast too. Yeah.
They're always looking for original guests that do something differently that helps them stand out. DM them and say, hey, check out my website. I'd love to. Come on and let's make a custom Dan Jansen, Remember your name.
Dan Jansen razor. Right. It's not an Imperium Champions Dan Janson, world famous Dan Jansen now with the new French accent. But you get my point.
Yes. And it's all great advice, great ideas. I really appreciate it and it's really inspiring to hear this kind of stuff. So thank you.
Imperium Shaving soon. To be honest, Dan Jansen razors. Dan, congrats for calling in, man. Good luck.
Thank you. These are really beautiful. Wow, they're so nice. I don't know, you strike me as the kind of guy that might have a fancy shaving kit.
I don't know. No, no, I don't use plastic. A little plastic one. But I did one time got a laminated fancy razor and bought this a few years ago.
So it required its own blades. It was a razor and razor blade stuff. I was so annoyed by that. But I'm gonna check out the Dan Jansen razors now.
Okay, next up after the break, another collar with another business challenge. I'm Guy Raz, and we're answering your business questions right here on the advice line on how I built this lab. Hey, welcome back to the advice line on how I built this lab. I'm Guy Raz and today I'm here with serial entrepreneur, the one and only Mark Cuban.
So let's bring in our final caller. Hello, welcome to the advice line. Please tell us your name, where you're calling from, and just a little bit about your business. Hi, guys.
Hi, Mark. I am so excited to be here. Thanks for having me. My name is Kristen Rood and I'm based in Grand Rapids, Michigan.
And I'm the founder and CEO of Northern Classics. We sell winter outerwear for kids. So we sell winter coats, snow pants, hats, mittens, and all the accessories to get kids outside in the winter. We have blended the technical performance of your typical high end ski wear with a little bit more timeless and elevated aesthetics.
Awesome. Welcome to Showcourse. And so tell me about the origin story, the brand, how did it how did it start? Yeah, so I ended up having, I had four kids in three and a half years.
It was right before and at the start of COVID and I learned firsthand how important it was to get outside for both my own sanity and for my kids sanity. And so as winter came around, I went to get snow gear for them and I really saw a white space. I saw there's two categories of what was on the market. It was either super technical, kept them warm and dry, but it was either just a black snowsuit or very rugged aesthetic or on the other bucket you had these beautiful pieces but they didn't actually work and wouldn't actually keep kids warm.
So that's kind of on the ideas part. And I brought the two together. I love this because winter and Grand Rapids is like summer in Las Vegas, right? Winter.
I always say if you're not a winter person, don't visit Michigan. December, January and now. Where are you selling your products through your website? Is it in stores?
So we do about 70% direct on our website and then we also sell through Masonette, Bloomingdale's, Nordstrom, Janie and Jack and then run a handful of kind of sea shops and outdoor stores. Are you in the retail stores or just online for them? Those are all the marketplaces. The retail stores are much smaller, more mom and pop shop types stores.
And what do you expect to do in sales this year 2025? We are on track to do just under a million. This is nice. And before we dive into, what's your question for us?
So my question, as I kind of mentioned, we're very, very seasonal. We do about 90% of our sales in four and a half months really between September and January. And then once, you know, we get to late winter, parents really aren't in the market to buy new gear for their kids. So sales just kind of drop off and you know, we've started to build.
It's small but a good following and highly engaged customers. So we're at this crux of when is the right time to add additional spring and summer pieces and do kind of expanse we get year round revenue and also say top of mind for our customers. Or do we just double down and stay solely focused on winter and really become the best kids see wear brand on the market? All right, this is seasonal business, winter business.
The question is do they add more products to a summer products? Do they double down focus on winter gear? Going to adult Mark, what do you think? Are you profitable, Kristin?
We are not yet profitable during our core winter Months we are. And then, you know, I have two full time employees. I do not plus salary myself, but I do have two salaries that are year round. And well, you got to answer your question there, right?
Yeah. Because if you're not profitable, you either got to borrow money or go out there and raise money or put more of your money in. And that's all risk capital. Right.
Because even though you feel confident in your brand, you build a good following. And you know, they all tell you, if you do stuff in the spring, I love your designs, I'll buy more, I love what you do and all that kind of stuff. You still don't make enough money to cover the off months. And that's where you've got to focus.
And right now, because of all the uncertainty with tariffs and other charges that are happening, you know, you've got to work on your supply chain first. Because I'm guessing the increase in tariffs is pretty much what you lose right now. Right. It's been an interesting year for sure.
Because those tariffs, losing that money, you didn't plan it and you didn't know. And it's all uncertainty. And you know, now's the time to try to see if you can use those summer months to evolve your supply chain and create alternatives because we don't know what direction those tariffs are going. And so focus on that supply chain, focus on trying to optimize wherever you can.
Are you buying primarily from China or where? Yes, we are all in China right now. All in China. Right.
So they're getting killed and gets worse all the time. And you're paying, how much are you paying in tariffs? What percentage we pay? It's, we almost double our product cost in tariffs.
We have our cost and then we double it. Wow. So it cost 50, sold for 100. Now if it costs 50, you cost you 100 because of tariffs and you could just double the 200 in your price.
Right. So you had to go to 150 or whatever just to make sure that you didn't piss off all your customers. And so what I would tell you is start looking for supply chain alternatives. So first step is, look, I need better prices.
See, even though you've built that trust because you've been working with your manufacturer, I know you've already said that, but you got to be a jerk sometimes and say, I need better prices again. And just see what they say. Because even if you pick up an extra 5%, 5% of a million dollars, that pays for one of those salaries. Almost.
Right. And so then looking at the alternatives. And it's hard to determine whether or not you're gonna use a broker, you know, third party importer. We use a third party broker to import everything to help with that process.
I was fortunate. I found a local designer who kind of helped me understand the whole manufacturing apparel manufacturing business specifically. And she connected us with our factory, which was awesome. Now, though, you really don't.