Was starting a product business a mistake?
Summary
TLDRIn this video, the creator reflects on the challenges and lessons learned from starting a product business, contrasting the initial optimism with the harsh realities of manufacturing. Despite setbacks and financial struggles, they express a deep passion for invention and the journey from building 'shitty robots' to developing meaningful self-improvement products. The creator shares insights into their brand 'Yore,' discusses the importance of cash flow, and candidly addresses the anxiety of uncertainty in entrepreneurship, while highlighting the rewarding nature of seeing their creations in the hands of users.
Takeaways
- π‘ The speaker emphasizes the difference between investing and losing money in a business, highlighting their ongoing commitment to their venture despite financial challenges.
- π§ The speaker's background includes engineering skills and access to free marketing through their YouTube channel, which they leveraged in their product business.
- π The speaker's initial internet fame came from creating 'shitty robots', which they monetized to pay for their house, showing the potential of unconventional ideas.
- π The speaker discusses the limitations of an influencer business, such as the stress and the challenge of scaling without compromising personal life or becoming excessively famous.
- π‘ The idea for a secondary business came after a health scare, leading to the creation of a calendar to track meditation habits, which was later turned into a product.
- π― The speaker's brand, Yore, aims to be humorous without being silly and premium without being pretentious, reflecting a careful balance in brand identity.
- πΌ The speaker has not raised external capital for Yore, choosing to self-fund the business to maintain full ownership and avoid external pressures.
- π° The speaker discusses the financial realities of running a product business, including upfront costs for product development and the importance of cash flow management.
- ποΈ The speaker mentions the strategy of using pre-orders to manage cash flow and reduce financial risk, acknowledging the need to adjust prices for profitability.
- π Despite the challenges and financial investments, the speaker expresses a deep passion for creating and manufacturing products, viewing it as a fulfilling career.
- π The speaker's ultimate goal is to continue creating and selling products they are proud of, aiming for a sustainable business that aligns with their personal values and ambitions.
Q & A
What is the main difference between 'losing money' and 'investing money' in a business according to the speaker?
-The speaker differentiates 'losing money' as giving up on a business, whereas 'investing money' implies a continued commitment and effort to make the business successful.
What was the speaker's initial optimism about starting a product business based on?
-The speaker was optimistic due to their ambition, having homebrew engineering skills, and access to free marketing through their YouTube channel.
What is the name of the video series the speaker plans to create about their manufacturing lessons?
-The video series is called 'Manufacturing Simone1 Sim11'.
How did the speaker gain internet fame in 2015?
-The speaker gained internet fame for building 'shitty robots', which led to starting a YouTube channel and turning it into a career.
What was the longevity issue the speaker was concerned about in their influencer business?
-The speaker was concerned about the sustainability of the 'shitty robots' joke and the potential for it to become stale over time.
What are the two ways the speaker identifies to grow an influencer business and why are they not interested in pursuing them?
-The two ways are producing more content and becoming more famous. The speaker is not interested because they value a good life and do not want fame for its own sake.
What was the turning point for the speaker that led to the creation of a secondary business?
-The turning point was the speaker's brain tumor, which made them realize the importance of not having everything hinge on their health and ability to be in front of a camera.
What is the name of the product the speaker created to help track meditation habits?
-The speaker created a calendar with mechanical switches to track meditation habits.
How did the speaker's Kickstarter campaign for the calendar perform?
-The Kickstarter campaign was successful, raising almost $600,000, although the speaker still lost money on the project.
What is the name of the speaker's product business and what does it represent?
-The business is called 'Yore', representing a brand that is funny but not silly, and has a premium feel without being pretentious.
What is the main challenge the speaker faces in running their product business according to the script?
-The main challenge is managing cash flow, especially the costs associated with developing new products and maintaining stock without sufficient sales to cover expenses.
What is the speaker's attitude towards the price of their products and why do they feel conflicted about it?
-The speaker feels conflicted about the price of their products because they believe in setting prices according to what they think customers should pay, rather than what is needed for the business to be profitable, leading to a sense of shame about asking for money for something they made.
What is the primary reason the speaker is still investing money into their business despite the challenges?
-The speaker is still investing because they love the process of creating new ideas, manufacturing them, and seeing them used and loved by people, which represents the work life they want to live.
What is the speaker's ultimate goal with their product business?
-The ultimate goal is to make enough money to continue doing what they loveβcreating and manufacturing productsβforever.
Outlines
π From Internet Fame to Product Entrepreneurship
Simone Giertz, known for her 'shitty robots' and YouTube fame, discusses her transition into product entrepreneurship. Initially optimistic about starting a product business, she acknowledges the challenges and lessons learned. Despite the financial investment and the struggle to maintain a balance between content creation and product development, Simone remains ambitious. She shares her journey from internet fame to launching a product line, including the creation of a unique calendar that helped her stay on track with meditation. Simone's narrative reflects her desire for a sustainable and fulfilling career beyond her influencer status, leading her to establish a product business that aligns with her values and skills.
π οΈ Building a Business with a Focus on Longevity and Cash Flow
In this paragraph, Simone delves into the intricacies of building a business with an emphasis on longevity and cash flow. She discusses the challenges of scaling an influencer business and her decision to create a secondary business to ensure financial stability. Simone shares her experience of self-funding her business, the risks involved, and the importance of hiring smart people who can learn on the job. She outlines the costs associated with starting her store and the monthly overheads, highlighting the financial strain of product development and inventory management. Simone's narrative underscores the importance of cash flow management and the careful balance between innovation and financial sustainability.
πΌ Embracing the Journey of Product Development and Business Growth
Simone reflects on her journey in product development, from the initial idea to the launch of her store, Yore. She discusses the process of naming her business, the importance of branding, and the challenges of managing a global team through remote communication. Simone emphasizes the importance of self-funding and the freedom it provides, as well as the risks associated with product recalls and financial instability. She also touches on the strategy of launching pre-orders to manage cash flow and the necessity of adjusting product prices for profitability. Simone's narrative conveys her passion for invention, her commitment to customer satisfaction, and her determination to overcome the uncertainties and discomforts of entrepreneurship.
Mindmap
Keywords
π‘Investment
π‘Manufacturing
π‘Kickstarter
π‘Influencer
π‘Product Development
π‘Cash Flow
π‘Entrepreneurship
π‘Branding
π‘Marketing
π‘Risk Management
π‘Product Launch
π‘Customer Service
Highlights
The speaker emphasizes the difference between investing and losing money in a business venture, highlighting the importance of perseverance.
Ambition and engineering skills are key drivers for starting a product business, as well as the ability to leverage free marketing through platforms like YouTube.
The speaker shares lessons learned from manufacturing products and plans to create a video series on the topic.
Internet fame from building robots led to a YouTube career, providing financial stability but raising concerns about longevity and scaling.
The desire for a fulfilling career beyond influencer status led to the exploration of product creation.
A personal health scare prompted the realization of the need for a secondary business to reduce dependency on personal well-being for income.
The creation of a calendar to track meditation habits led to the idea of turning it into a product, demonstrating the value of personal projects.
The challenge of balancing the cost of mechanical parts in product design with the desire for a premium feel.
The Kickstarter launch of the calendar product, illustrating the intersection of personal passion and business opportunity.
The importance of product pricing in ensuring profitability and the struggle with setting prices that reflect both cost and customer value.
The speaker's journey from building 'shitty robots' to creating self-improvement products, showcasing a significant career pivot.
The launch of the Yore brand and the strategic approach to naming and branding to convey a premium yet approachable image.
The operational structure of the Yore business, including the team composition and the challenges of managing a global team.
The financial considerations of starting a product business, including the costs of development, stock, and the importance of cash flow.
The decision to self-fund the Yore business to maintain full ownership and the associated risks and rewards.
The speaker's personal emotional journey with product creation, including the fear of failure and the drive for success.
The announcement of a new product, the foldable coat hangers, and the strategy behind pre-orders to manage cash flow.
The speaker's commitment to the Yore brand as a lifelong endeavor and the desire to continue innovating and creating.
Transcripts
I've lost so much money on this business
no I've invested so much money into this
business there's a difference and I
haven't lost it until I've given up I'm
doing boy
[Music]
math I knew that starting a product
business was going to be hard but I was
still really optimistic because I'm
ambitious I have some home brw
engineering skills and I also have
access to a lot of free marketing
because I mean you're watching this
video aren't you but holy humbling hell
the positive way of phrasing it is that
I've learned some lessons and I know
that a lot of you are curious about
manufacturing products so I'm turning
those lessons into a video series
manufacturing
simone1 sim11 you get it
in 2015 I was thrown into internet Fame
for building shitty robots
then and I started a YouTube channel and
managed to turn it into a career I
wasn't making a huge amount of money but
like shitty robots paid for my
house who else can say that Simone yes
[Music]
[Applause]
and as much as it was a really stressful
time I was also having so much fun with
it nice
[Music]
but I knew that I was going to get tired
of the shitty robots joke eventually and
I never want to beat a dead horse or
even beat a live horse so much that it
dies so there was a longevity issue that
I was concerned about and then on top of
that there's also a scaling issue
because there are only really two ways
to grow an influencer business one is by
putting out more content which I don't
want to do because I want to have a good
life life or number two by becoming more
famous which I don't want either I just
really like being able to go to the gym
looking like Fame to me just like
money I I like to call it life Lube
because it makes everything go easier
and it can also give you access to
places you wouldn't otherwise be able to
go but to me it's just a tool like it's
not an end goal so then the question is
what's the end goal I started thinking
about making making products really
early on I remember wanting to make
miniature versions of some of my
machines we also had some conversations
about making a shitty robot's card game
or different maker kits but it just
didn't feel right like it wasn't very
original and it felt like I was doing
something just for the sake of doing it
which I reserve for things like my pasta
maker but then I made something that
changed everything and that was is a
brain tumor hands down the worst thing
to ever come out of my head Jokes Aside
I'm fine but it made me realize that I
really needed a secondary business
because I can have everything hinge on
me being well enough to be in front of a
camera I wonder if this still
works no I cut the power
cable thanks past Simone I I built this
calendar because I wanted to track how
often I meditated so every day that I
meditated I got to flip a switch and I
was so surprised by how much this
calendar helped me stay on track like I
meditated every day for years and I
wanted to see if I could turn it into a
product I love the mechanical switches
but when you have 365 of something the
cost really adds up so I put together a
team of Engineers and we made a version
of this calendar with without any
mechanical parts and then we released it
on Kickstarter my name is Simone and I'm
mostly known for building things that
don't
work I realize that might be the worst
Kickstarter intro of all time but the
thing is besides making useless machines
I buil a lot of other things I love
seeing how I was like trying to bridge
the gap going from shitty robots to like
really lofty products for
self-improvement I think I managed
pretty well I mean I raised almost
$600,000 still lost money on the project
though but um yeah how is that possible
I'm going to do a more detailed
breakdown of the everyday calendar in a
future video so to find
out please subscribe and while you hit
subscribe let's take a quick
break so I am currently in Sweden to see
family and do you recognize the spot
this is where I shot the wake up machine
and 2016 but before I started Living
that whole weird internet miracle I had
no idea what I wanted to do in life it
can be really hard to figure out how to
build a career and even harder to figure
out how to build a fulfilling career
880,000 hours is the sponsor of this
video but more importantly they can help
you find a career that will make a
positive impact in this world and the
best part is that it's all free 880,000
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support to help people have a positive
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80,000 hour.org
Simoni okay now back to my
career I found a list of all the
rejected name ideas in my notes app
where things are sold the things store
from here like I remember wanting a name
that was funny as a response so when
somebody would ask like where did you
get that from you could just respond I
got it from
here only catch is that a generic name
like that is really bad for search
engine optimization heard of
it idea Rehabilitation Center is pretty
funny but also making fun of myself in
that way is something that works when
you're building shitty robots but when
you're trying to convince someone
someone to buy your product you really
have to like stand proud shooting myself
down is a reflex that I've had to like
actively work on getting rid of so I
ended up naming it
yor which is still making fun of myself
I guess but like in a different way
because the joke is that y is how you
pronounce my last name because um nobody
knows I wanted the brand to be funny but
not silly and for it to have a premium
feel but not be pretentious
so we have the build dice our
screwdriver and screw ring a white
incomplete puzzle that weirdly enough is
our bestselling product and some sawdust
socks I actually designed the Yore logo
when I was working on the packaging for
the screwdriver ring because I wanted to
have a laser cut hole that you could try
the screwdriver with and I couldn't
figure out how to fit that and the name
of the brand in one spot until I was
like like
oh only downside is that it reads like y
when it's monochrome which all of our
packaging
is it's on my to-do list to
fix I launched the edge store may 2022
with two and two half employees so we
have an engineer a head of manufacturing
and my producer and I who both split our
time between the media and the product
business on top of that my talent
manager he came on as a business partner
so he's not salaried but he has a share
in the business and we are all over the
world it is all slack and Google
Hangouts key learning for me is that
it's a lot better to hire smart people
to learn than to hire stupid people to
do something that they already know how
to
do hey so I have not raced any outside
capital for the Y door it's all
self-funded which is great because I own
it fully and I don't have to answer to
anyone the part that's not so great is
that if we ever had to do like a product
recall then I would probably have to
take out a second mortgage on my house
I'm not going to share numbers in the
nude because that feels too personal but
here's a rough overview of all the costs
to start the yet store and for our
current monthly overhead cost this is
out split it is all about cash flow like
developing a new product costs a bunch
of money up front and then you have to
find even more money to buy stock from
your factory that you then hope to sell
to slowly earn back that money plus
profit and if you don't sell it then you
have to pay a storage fee at your
fulfillment center so we're currently
moving it like a semi snail pace and
launching maybe one and a half new
products a year because that is what I
can afford
speaking of which this video is brought
to you by the yat door you might have
seen our foldable coat hangers that can
turn any Nook into a functional closet
and I am excited to announce that we are
launching pre-orders for the coat
hinders today so if you miss the
kickstarter campaign we are opening up
sales for our second batch for a limited
time only and why do we do pre-orders
because of cash flow so if you have a
hallway or a closet that can't fit a
standard coat hanger the coat hinger is
going to be a game changer for you and
if you notice that they're a bit more
expensive than during the kickstarter
campaign it's because I've realized that
I need to raise my
prices I really hate it like I hate
hearing people say that my products are
expensive because I think I just have a
lot of Shame around asking people to pay
for something that I made but the thing
is when you hear about a product having
like a 4X markup so your selling price
is four times the manufactur cost it can
sound really greedy but it is what you
need for it to be profitable and I'm not
even selling most of my products at a 2X
markup because I've just set prices
according to what I think they should
cost for the customer and not as to what
they have to cost for my business to
make sense so I am still losing money
every month running the Y door no I'm
still investing money every month and
honestly I'm just waiting for the moment
that we hit break even like that is
going to be such a joyous day and I'm
just going to let out a leld fart of
anxiety I've been developing in
manufacturing products for almost 6
years now and I'm not going to lie it's
been tough like sometimes I wake up in
the middle of the night and I just feel
like throwing up I'm just terrified of
disappointing people and selling people
products where so many things can go
wrong it's just really scary for me and
whenever I see someone upset even though
we have like amazing customer service
and we try our absolute best to make
everyone happy I just want to close-up
shop and go hide under my couch and what
I keep telling myself is that handling
uncertainty and discomfort is a skill
that I can grow and it's a skill that
makes me better at this job and honestly
I think I also just really want to prove
myself like I'm really proud of the
shitty robot chapter of my life like I
have no regrets about it but that can't
be
it like I want to be an inventor in a
true sense not just in a joking way
and honestly I think I just really
really really want to be
smart and
hot but mostly smart
so with all of that in mind do I regret
starting the atge
door no not at all because weirdly
enough I love it I love coming up with
new ideas I love working with my
engineer to figure out how to
manufacture them I love writing the
story of the product and making it
planed for how to Market it and nothing
makes me as proud as seeing something
that I made be out in the world and
people using them and ideally loving
them the Yore isn't just a business to
me like it is the work life that I want
to live I got to spend 3 years
developing the coat hinger and then
release it and it getting such a great
response except for the people that kept
on doing
[Music]
this it's not the same thing but thank
you for your engagement so it's tough
but it's also so r rewarding and
honestly I just want to make enough
money so that I can keep on doing this
forever this is a horse I will gladly
beat until it dies thank you so much for
watching this video if you have any
questions about manufacturing or about
starting a product business that you
want me to answer in future videos you
can leave them down below and if you
want to buy any of our products you can
do that at y. store and if you don't
want to buy any of our products you can
still follow us on Instagram okay okay
bye
[Music]
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