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Not many people trade in both a successful finance career and the chance to get a Harvard diploma for the opportunity to launch a business. But that’s what Sarah Paiji Yoo did. And when she found success and sold her first company, she knew that she could never satisfy that entrepreneurial itch by doing anything but building another company. Sarah went on to co-found a start-up studio and helped launch a number of other companies, including M.Gemi and Rockets of Awesome, but she craved more. Ultimately, she wanted to dig into something that served a deeper purpose.
Today, Sarah is a co-founder of Blueland, a consumer products company on a mission to eliminate single-use plastic packaging. The way Sarah and her team are accomplishing that mission has started with creating a new way to develop and use cleaning products and has included a stop along the way in the Shark Tank, where Mr. Wonderful himself, Kevin O’Leary, bought into the company.
On this episode of Up Next in Commerce, Sarah sheds light on common mistakes that young entrepreneurs make when they are starting out, as well as shares the secrets for avoiding those mistakes. Plus, she explains what the holy grail metric is for judging the health of your company.
Key Takeaways:
- In the early days when you only have one or two products that consumers buy, it’s easy to keep track of how people get funneled through. As you begin to expand your product offerings, measuring acquisition behavior and retention becomes more important in being able to judge the health of the company and the new products brought to market.
- The importance of focusing on product-market fit can’t be overstated. Often, young companies and their founders get caught in the trap of trying to please investors or race to profitability through clever marketing or other shortcuts. The only way to achieve meaningful, sustained success is to know you have product-market fit from the get-go, and then optimizing your strategy from there.
- You can still do something even if you don’t have all the pieces to the puzzle. Even though an idea seems simple, there are always going to be complications to work through. Being tenacious and having grit are the keys to being able to see you vision through to completion.
For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.
Key Quotes:
“It was hard going from this small, mobile startup where if Apple made an announcement about the newest feature, then I would get together with my team and our engineers and really think about how we can integrate this and use this to push our product forward. In a larger organization, you have longer product roadmaps, and you need to justify why a change that you want to make is going to add more value to the company than some much larger initiatives that may be underway.”
“In 2013, we believed that it was still in the early innings in terms of direct-to-consumer…it was our belief that we would continue to see whole categories move direct-to-consumer —many of which we’ve seen come to fruition. I remember at that point thinking, ‘Oh, we’re going to see everything from shoes to socks to tampons to vitamins, etcetera, everything is going to develop a new brand and find more efficient ways to directly reach and communicate with consumers.’”
“The biggest takeaway from launching multiple businesses is the importance of focus and the importance, especially, of focus on product-market fit. In the early days, I think it’s very easy, especially when you are venture-backed, either with access to capital or with this immense pressure to grow quickly, to grow into the valuations that you may have raised. It can be easy to fall into the trap to shift a lot of your focus to marketing and growing. Ultimately, the best marketing is an amazing product or service that drives strong retention and strong word of mouth.”
“An important metric or area of metrics to look at certainly are around retention and repeat. Because ultimately there is a lot of focus, especially in D2C, on acquisition. And whether it’s customer acquisition cost or cost per acquired customer, ultimately, that doesn’t give you the full picture. That just tells you that you were able to have a clever ad and maybe you have attracted someone to make that first purchase. But it’s certainly a lot cheaper to have your customer purchase again and repeat with you than having to go out into the market and pay for a brand new customer. And so, we’ve always been extremely focused on the retention metrics as a leading indicator to help the business.
“A big piece of being an entrepreneur is that it’s not rocket science, it’s just about being tenacious, having grit, not taking no for an answer, and not assuming that because it’s never been done, that means that it can’t be done.”
“I would argue it’s easier to convince someone doing a one-off special purchase, like glasses, to go to a separate [online] destination. With cleaning products, this is a product that surveys have found that over 80% of people would prefer to purchase these either in brick and mortar stores or as part of the shopping that they’re doing regularly anyway….But I think it all comes back to focus. We always knew that direct-to-consumer was going to be an important component of launching the brand. I think there are so many benefits, especially from a brand building and storytelling perspective and explaining the mission and as a new brand to market just explaining who we are.”
“We need to look at our data in a more nuanced way and build in different ways to really understand what is happening. But largely we are very focused on customer acquisition cost, the conversion on our site at every part of the funnel and then repeat basket size based on original basket size and channel.”
Mentions:
Bio:
Sarah Paiji Yoo is a serial entrepreneur and the co-founder of Blueland. Sarah co-founded Blueland once she discovered the microplastics within our water while researching how to switch from breastfeeding to formula and appeared on the Season 11 premiere of Shark Tank, securing a $270,000 deal. Sarah was previously a Founding Partner at LAUNCH, which created cult-favorite brands such as M.Gemi, Rockets of Awesome and more. Prior to LAUNCH, Sarah was also the CEO and Co-founder of Snapette, the largest mobile platform for local fashion shopping, that she sold to PriceGrabber in 2013.
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Transcript:
Stephanie:
Hey, everyone. This is Stephanie Postles, your host of Up Next in Commerce. Today we have Sarah Paiji Yoo on the show, the co-founder and CEO at Blueland. Sarah, how are you?
Sarah:
I’m great, how are you, Stephanie?
Stephanie:
Doing well. And you’re calling in from New York, right?
Sarah:
Yeah. Good, old New York City.
Stephanie:
Yeah, how’s New York life right now?
Sarah:
New York life, it certainly feels … It’s funny, because I feel like in the beginning, we definitely were the hotspot of coronavirus. But now it feels like one of the safer places to be, given the high immunity. So, it’s good. I think it’s a little unfortunate that summer now, it’s my favorite season in New York, so, it’s unfortunate that we’re still, for the most part, having to stay at home. But I think we got in our groove and it has definitely given at least my family the opportunity to force ourselves to find other ways to explore nature right outside New York City.
Stephanie:
So, I’d love to dive a bit into your background before we get into Blueland. Because I read some interesting things about you about having some Ecommerce companies in the past and dropping out of Harvard MBA program and I’d love to hear a bit about your journey of how you got to where you are today.
Sarah:
Yeah, absolutely. So, I guess if I were to start way back, I started my career actually pretty traditionally in finance and consulting. Certainly early in my career I actually had no aspirations to be an entrepreneur. I always consider myself relatively risk-averve so it is interesting to see how life unfolds. But yeah, I started my career very traditionally after those stints in consulting and finance, which I actually wouldn’t trade for the world. I really appreciate the experiences and the skillsets that I picked up and the frameworks it gave me to really think about the world and business.
Sarah:
But after those stints I decided to go back to Harvard for business school, to really, most of all to be able to have the time to step back and reflect on what it was that I wanted to do next. Because I think my early experiences, if anything, taught me that I wasn’t a lifer in terms of professional services, I really wanted to be more in the driver’s seat and wanted to be at a company versus advising the company. And so, yeah, I made the decision to go to business school. And when I got to business school it was a really interesting time because there had been, right before I came, a series of female founders that had started very impressive companies, GuildCrew, Birchbox, Rent the Runway, LearnVest, Katrina who started Stitch Fix with just one year ahead of me in business school.
Sarah:
And that was extremely inspiring for me just to see a set of women who were young and had a very similar background or set of experience as myself and see them so quote, unquote, early in their career, setting out to build their own business. And I decided that given business school … You can make what you want of business school but it doesn’t have to be particularly rigorous. And so, I had more time on my hands than I did previously what I was working in, so I decided to really use that time and try to start a business while I was in business school. And a few months in I ended up starting work on my first startup, which was Snapette, which was a mobile shopping app that helps consumers find products and stores around them.
Sarah:
I was really excited about everything that I was seeing around smartphones and the mobile space. And this was still pretty early on. So, this was almost 10 years ago, pre Instagram days, if you can imagine a world before Instagram.
Stephanie:
Tough world to start in.
Sarah:
Yeah. Yeah, exactly. But yeah, that’s the first business I decided to start while in school. I ended up raising a round of venture capital that summer between my first and what was supposed to be my second year of business school. And so made … it was actually a very easy decision, to drop out of Harvard and continue to just work on Snapette. And I ended up scaling that business for the next about three and a half years to a small team, about 20 people. And then we ended up selling that business to one of the world’s largest stock search engines at the time, called PriceGrabber. Again, almost four years in. And-
Stephanie:
That’s amazing. What was the process like, selling the company? Did you actively go about selling your company or were you approached? Or how did that look? I heard a good quote the other day that companies don’t just get acquired, you actually need to actively go and sell your company if you want it to be sold sometimes.
Sarah:
It’s interesting because I’ve also heard the opposite.
Stephanie:
Oh, interesting.
Sarah:
Which I can related to both [inaudible 00:05:48]. I was actually worried with the phrase, but we were lucky in terms of we received an inbound.
Stephanie:
Oh, nice.
Sarah:
That tipped us off to, “Oh, this might actually be a good time to sell. And the context of that period was, I started Snapette at a time when Mary Meeker and a lot of these industry experts were saying, “Oh, mobile’s going to be the future. People are going to spend more time on their phones than on their desktop,” and that seemed inconceivable, the early days as she was saying that. And when we sold, that’s when we were seeing about 30% of site traffic, to many of the major sites coming from mobile instead of desktop. So, it still hadn’t flipped yet.
Sarah:
But it definitely felt like it was coming. And so, yeah, we had an inbound from a traditional, online, non-mobile player. And that kick started me to reach out to a few more folks in the space that had a similar profile, because if we were going to engage in these conversations I thought, “Let’s run a robust process,” because obviously competition can always help drive a better outcome. And so that’s what I did. And ended up not really engaging a bank or anything. That’s where my former finance experience definitely did come in handy because I did have experience buying and selling companies and so I understood ad a high level what that process looked like. And so, yeah, we were able to quarter back that process in-house and get a few offers and ultimately find an acquirer for our business.
Stephanie:
That’s amazing. So, at that point you got the itch to start another company? You’re like, “This is great. I’m going for round two.”
Sarah:
Yeah. Yeah, yeah. Exactly, exactly. So, initially we had … Not initially. We had a one year lockup with the parent company. And so our whole team moved over. And it was interesting, I think initially I was extremely excited about the prospect of being part of a much larger organization, that had much higher revenues and much larger budget. And I didn’t expect how quickly … I feel like day one, post-acquisition all of a sudden, the speed at which we were running, everything came to a halt. And all of a sudden my calendar was full of just meetings with lots of people back to back.
Sarah:
And I think it was hard. I think it was hard going from also this small, mobile startup where Apple would make an announcement about the newest feature and then I would get together with my team and our engineers and really think about like, “Oh, how can we integrate this? How can really use this to push our product forward?” And in a larger organization, completely understandably you have much longer product roadmaps, you need to justify why a change that you want to make is going to add more value to the company than some much larger initiatives that maybe underway.
Sarah:
And we were dealing with 18 month, plus product roadmaps, which to me at the time felt like, “Oh my god, if I have to wait 18 months to start working on some of these things, I’m going to be dead.” So, it was an interesting contrast for me. And so, I certainly, definitely developed that itch to go back out and start something again. And I think also as a first time founder with Snapette, I had made so many mistakes along the way. And I was just dying to do it again but be better the next time around.
Stephanie:
So, then where did you go after that [crosstalk 00:09:35]?
Sarah:
Yeah, so after that, it’s interesting, because I think … my career, my life had been so linear til pre Snapette. But I think that startup journey really showed me both the joys and the benefits of just being being open to what life may bring and that really just reaffirming the Steve Jobs quote, “If you can’t connect the dots forward, only looking back.” And so, at that point I knew I wanted to get back into early stage company building. I wasn’t proactively looking for my next business or the next idea, but I ended up reconnecting with a former acquaintance in the Ecomm space, Ben Fischman, who had also sold his startup, Rue La La, which was one of the first flash sale sites here in the U.S.
Sarah:
And he had sold his company right around the same time I sold Snapette. And he was exploring the idea of raising a fund and to start a series of new businesses. So, it wouldn’t be a venture capital fund, but it would be more like a startup studio. And the thesis that we both share was that, at this point it was 2013, we believed that it was still very early innings in terms of direct-to-consumer. So, at that point Warby Parker was our, in way, that preeminent example of direct-to-consumer. But it was our belief that we would continue to see whole categories move direct-to-consumer, and many of which we’ve seen now come into fruition. I remember at that point thinking about, “Oh, we’re going to see everything from shoes to socks to tampons to vitamins, etc. Everything is going to develop a new brand and find more efficient ways to directly reach and communicate with consumers.”
Sarah:
And so, yeah, he was like, “You should come do this with me.” And at that point, again, I didn’t have a specific idea in mind. I knew that I wanted to be back in the company building stage. I loved the tech and direct-to-consumer space. And so, yeah, I jumped onboard with him and was a founding member and partner of that team. And so, that startup studio was called LAUNCH, or is called LAUNCH, it’s still around today. And the goal was to then launch one new business per year, which is what we ended up doing. So, over the next four years we launched M.Gemi in our first year, Rockets of Awesome. M.Gemi is a direct-to-consumer footwear business. And then we launches Rockets of Awesome the second year, which is a direct-to-consumer subscription kids apparel business. And then we launched Follain, which is a clean beauty retailer. And in the last year that I was with LAUNCH, LAUNCH Trade, which is a direct-to-consumer coffee marketplace.
Stephanie:
Very cool. How did those individual companies do?
Sarah:
The individual companies have all been doing great. They’re still around today, very proud of how far they’ve come. But it was definitely a crazy time. Certainly in a period where we’ve seen over funding and collapses, you know many important DTC businesses I think very proud to say that all those businesses are in great shape and still around today.
Stephanie:
Yeah, that sounds really fun. Chaotic and crazy but fun. Were there any universal truths that you learned? Even though the companies sound very different that you were launching there, was there anything that you found a best practice and then you could apply it to future businesses?
Sarah:
Yeah, I think the biggest takeaway, probably from launching multiple businesses is just the importance of focus and the importance especially of focus on product market that in early days I think it’s very easy, especially when you are venture backed, either with access to capital or with this immense pressure to grow quickly, to grow into the valuations that you may have raised that it can be easy to fall into the trap to shift a lot of your focus to marketing and growing. But ultimately the best marketing is an amazing product or service that drives strong retention, strong word of mouth.
Sarah:
And any marketing spend that you deploy is going to be so much more efficient and effective if you don’t have a leaky bucket. And I think that’s one that is certainly harder, especially in this world where we celebrate large fundings and also companies growing very quickly. And I just think there’s so much value, especially early days of almost staying smaller so that especially the founders can really focus entirely on product-market fit and making all the tweaks necessary to really optimize the product, service or offering.
Stephanie:
Yeah, I completely agree about that. How did you all go about finding or knowing when you had product-market fit? Were you like, “This is the one, let’s move forward.”?
Sarah:
Yeah, yeah, yeah. I think it’s hard to draw that line in the sand, for sure. I think an important metric or area of metrics to look at certainly are around retention and repeat. Because ultimately there is a lot of focus, especially in D2C, on acquisition. And whether it’s customer acquisition cost or cost per acquired customer, ultimately, that doesn’t give you the full picture. That just tells you that you were able to have a clever ad and maybe you have attracted someone to make that first purchase. But it’s certainly a lot cheaper to have your customer purchase again and repeat with you than having to go out into the market and pay for a brand new customer. And so, we’ve always been extremely focused on the retention metrics as a leading indicator to help the business.
Stephanie:
Yeah. yeah, that’s great. So, then, at what point were you at LAUNCH where you were, once again, “It’s time for me to move on, do my own thing again.”?
Sarah:
Yeah. Yeah. So, I had a crazy journey and it was an amazing ride. I learned a ton about launching new business, having to do that back to back. But I think after my fourth year, after the fourth business, I developed a deep seated desire to do something that was a little more personally meaningful. I think for so many years simply the challenge and excitement of bringing a new brand or product to market that had never existed before was enough for me and it was incredibly energizing. And I still love that aspect of it. But at that point I was looking to build something beyond selling more shoes or beauty products.
Sarah:
And I think that also was heavily influenced by my becoming a new mom around that time. So, it’s not coincidence that the number of years I’ve been working on Blueland is about the same number of years as my son’s age.
Stephanie:
Yeah, it’s funny how all of a sudden, same with me, you get interested in what’s organic and what’s actually natural and-
Sarah:
Hard to miss it.
Stephanie:
Yeah, it’s something I never paid attention to that much until having kids.
Sarah:
Yeah, no, exactly, exactly, exactly. And I think you also start questioning how you’re spending your time. You have very limited time, and thinking once you have children and a family it highlights more clearly for you the trade offs between work and rest of life. And I think, I was very open to how I would feel on the other side of motherhood. I was very open to maybe I wasn’t going to want to work at all. Maybe I was going to be so obsessed with my child that I was going to want to spend every waking moment with him, which would also have been a fine outcome. But interestingly, after having my son, for me, I realized that I still really did love working. I loved my work a lot but I think I just needed to find more meaning in it if it was going to take up so many hours of my day and taking away from my child.
Stephanie:
Cool. So, then, what was the first step when it came to … what really led you to creating Blueland? Was there an aha moment, was there something … Tell me a little bit about what Blueland is maybe first and then how you came up with the idea.
Sarah:
Yeah. So, Blueland is a consumer products company, we are on a mission to eliminate single use plastic packaging. And we are starting with cleaning products. And so, the first set of products that we launched, when we launched about a year ago were a set of cleaning sprays and hand soap. And what was really unique about our products was that instead of selling you a bottle of liquid, these products are traditionally about 90% water, we’ve shrunk these products down to these tablets that are about the size of a quarter so that instead of buying a new plastic bottle every time, instead of paying for all this water which you already have at home, you can use one of our beautiful, reusable bottles and simply fill them up with warm water, drop in one of our tablets and it starts to bubble on its own, there’s no shaking or stirring or weird chemistry required. And at the end of a few minutes, you have a full bottle of hand soap or cleaning spray.
Stephanie:
Yeah, that’s cool.
Sarah:
And our cleaning sprays include a multi-surface cleaner, glass and mirror and a bathroom cleaner.
Stephanie:
Yeah, it remind me of a Alka-Seltzer, where you drop it in and then all of a sudden you have this big big bottle of cleaning solution.
Sarah:
Exactly, exactly, exactly. And we stared there because we found that it was very intuitive for people even though it was something that had never been done before, it was brand new to market, it was something that people could see and quickly understand like, “Oh, that makes sense. That water and the tablet can make a bottle cleaner.” And so, yeah, those are the products we started with. Happy to say last month we released our newest category which is the dish category. So, we launched a dish soap and dishwasher tablets. And in a similar vein, these products were created as part of a reusable, refillable system. So, upfront we sell you a permanent, forever container that you can refill with our refills that come packaged in paper based compostable packaging instead of plastic.
Sarah:
And so, our dish soap is actually a powder. But it’s used very similarly to liquid, to the extent that you just sprinkle it directly onto your sponge, you add water and then you get a nice, rich foam. And yeah, our dishwasher tablets are naked, to the extent that they don’t come individually wrapped in that plastic film that you’ll find, with most all dishwasher packs.
Stephanie:
I’ve never really thought about, “Where does that film go? Does it just go down the drain?
Sarah:
Yeah. So, it’s unfortunate because it-
Stephanie:
That’s sad.
Sarah:
Yeah, it is sad. It is sad. Because I think the assumption for a lot of people, understandably, is that because it dissolves, that it just goes away. But unfortunately, because it is a synthetic petroleum based plastic film, the plastic molecules do still remain and enter our water systems and majority of it is then ultimately released into the oceans, rivers and anything else.
Stephanie:
So, when building this company, I read that you had reached out to over 50 manufacturers who all turned you down. And I wanted to hear-
Sarah:
Oh my goodness.
Stephanie:
I wanted to hear that story a bit, because I think most people maybe after 10 woudlve been like, “Well, it’s not possible.” Or, “We can’t find how to contain these tablets.” Or, “No one knows how to do it.” Tell me a bit about what was that process like when starting to build the products out and trying to find people to partner with to make them?
Sarah:
Yeah, yeah, yeah. So, I think a big piece of being a entrepreneur, it’s not rocket science, it’s just being tenacious and having grit and not taking no for an answer and not assuming that because it’s never been done, that means that it can’t be done. And so, yeah, I think when we initially came up with this idea for Blueland, it was a crazy idea. And we had a lot of questions from people like, “Well, if it’s so easy, why hasn’t it been done?” And we’re like, “Well, somebody has to be the first.”
Sarah:
And so, yeah, initially, the natural place to start was to reach out to manufacturers, because typically, whether it’s in the food space or the cleaning space or in the beauty space, a lot of these spaces are fashion. A company usually works with a contract manufacturer to actually make their products. And so, first choice was finding someone with the existing infrastructure that could just make this for us. Not surprising, in retrospect, hindsight’s always 20/20, that no one could do this for us. We were reaching out to cleaning products manufacturers who were creating these products as liquids, and they were pretty much telling us how, “We don’t know how to deal with solids, like we don’t even have tableting machinery. And in fact, many of the ingredients that we buy for our liquid products actually come in liquid form. And so not even sure how we would then transform that into a dry product.”
Stephanie:
But did you have an ingredient list? Were you like, “This is what I want in it?” Because that [crosstalk] seems hard to me of like, how would I make a multi-surface cleaner?
Sarah:
Exactly, exactly. So, in the beginning it’s just this huge chicken or egg problem. So, we reached out to many manufacturers. And at that point it became also just less so in terms of … we didn’t necessarily think we were going to find an end-all, be-all solution with one of these calls but our hope was that we were going to get enough smart people in the space, who had been in the space for decades to talk to us in each of these conversations, we were going to glean a little bit more information. And if they couldn’t do it, they would potentially know someone else who could. Whether it was a scientist … because a lot of these contract manufacturers also work with contractor chemists, et cetera, they might know of an ingredient that they heard of that would be able to help us do this and so it really was just our form of Googling around, when Google could only get us so far on these niche topics that no one had a reason to read up about online.
Sarah:
But yeah, I think it became apparent through these conversations that someone was going to be able do just do this for us and everyone was recommending that we would need to come to them with a formula. And at that point felt like we hit another wall because my co-founder and I, we didn’t have any chemists in our direct network. We had no idea where to even begin. We were both business people. And so, we, after asking our network, not really finding any leads to any reputable chemists, certainly no chemists with a cleaning products background, we just turned to LinkedIn.
Stephanie:
Ooh.
Sarah:
That was just a natural place to turn to, to be able to search for experts based on their experiences and at that point ended up going down another, very long rabbit hole of collecting … We still have that spreadsheet today of hundreds of names of chemists that we found on LinkedIn and wrote up what their background was and ranked them and then just started reaching out to them, just [inaudible] reaching out to them on LinkedIn and just trying to get as many people as we could on the phone with us, like we were doing with the manufacturers.
Stephanie:
Did you get a good response rate from people or was it slow?
Sarah:
It was definitely slow. In LinkedIn there’s all these limitations of if you’re not connected, they may not readily see your message, also turns out a lot of chemists aren’t actively checking their LinkedIn or messages. We also were just two random people that were messaging about this crazy idea that most recipients on the other side probably had like, “I don’t know how to do what they want to do,” or, “This idea seems crazy,” or, “Why are they soliciting me for a job? Why would I leave my big company, well paid job to go do this?”
Sarah:
So yeah, I think suffice to say response rate wasn’t great. But to some extent, it also was a numbers game, which is why we did reach out to so many people. And we were able to get a good number of people also just to get on the phone with us. And there definitely were a set of folks that we’re so thankful to that were inspired by our mission and the audacity of at least the vision, and were willing to chat to see if they could be helpful. And that is ultimately also how we found our incredible head of R&D, Syed, it was through LinkedIn.
Sarah:
He was formerly at method, which is one of the world’s largest non-toxic cleaning products companies. And prior to that, he had the perfect background because prior to cleaning products he was actually working in nutritional supplements. So, vitamins. So, he also had that hard, tabled-like form factor experience.
Stephanie:
That’s amazing. So, how many tablets are you selling today? And how much plastic is it removing from the environment if someone chooses that versus a normal alternative?
Sarah:
Yeah, yeah, absolutely. For us today, I forget the latest numbers. But we’ve sold tablets in the millions-
Stephanie:
Wow.
Sarah:
… at this point, which is exciting because that means that our impact has also certainly been in the millions of plastic bottles eliminated. I think people are always surprised to hear that five billion plastic cleaning bottles are discarded each year, because there is so much focus on the water bottles and the coffee cups and the straws. Rightly so, because those numbers are even larger. But people are always surprised to hear how much of ian impact you can do by also just swapping out your cleaning products to a reusable solution.
Stephanie:
Yeah, yeah. That’s amazing. Nice work. So, I’m guessing there has to be some kind of convincing and education factor that had to go on because a lot of customers at first, they all worry about maybe the anti-microbial factor and everyone’s probably … at least when I think about it I’m like, “Just throw some Lysol on it or bleach or something, that’ll clean up anything.” How do you go about convincing people that your product has the same benefits and even though it’s natural, it’ll still work? What does that education piece look like?
Sarah:
Yeah. So, that education piece is obviously so important and has become even more important during this period of time and COVID where people are very focused at keeping germs, bacterias and viruses at bay. We received, especially in March and April, that was the number one question that we were getting, especially around hand soap, actually. Where people were asking if our hand soap was antibacterial, whether our hand soap would kill COVID. And there we were very direct with the answer that ultimately, no, our hand soap is not antibacterial, it’s not disinfecting, we cannot make the claim that it kills COVID. But it was an educational moment for us because at that point we could start the conversation with consumers that also are rooted in many studies that suggest that antibacterial soaps might actually be doing more harm than good, as well as if you look at the FDA, they’ve made official statements that say, “Regular, non-antibacterial soap is effective for the removal of bacteria and viruses,” and that hand washing with plain, non-antibacterial soap is a great way to prevent the contraction and spread of illnesses.
Sarah:
And so, I think most people that hear that get it, and it will even link them to the FDA site on proper hand washing techniques and just to just reassure people this, “By no means are we looking to mislead or brainwash,” but that it’s just more the education of, you know, many times I think there’s this perception you need a certain set of ingredients to get a certain job done. But-
Stephanie:
It’s part of the marketing behind that too, for people who do have the antimicrobial stuff in it, they’re pushing it so hard, “You need this,” when I’ve read the same research about you actually don’t really need that and you can still have very clean hands afterwards.
Sarah:
Yeah, yeah. Exactly, exactly, exactly. And so, it’s been nice. It’s been a nice period where we can also provide that education, because we are staunch supporters of non-toxic formulations. And so, any opportunity that we have to speak more to the efficacy of non-toxic products as well is always, we think, a good thing, not just for us but for the broader industry and for people on the planet.
Stephanie:
Yeah. So, how do you get people to find you? I’m thinking, if I’m going to the grocery store, that’s maybe where I’ll pick up a cleaning product when I run out or something. Are you in retail or were you planning on going into retail before COVID or are you staying strictly B to C? Or how are you thinking about that? Because it seems like it’d be hard to bring people over to buying online when maybe they’ve never thought to do that unless it’s through maybe Amazon Prime or something, I don’t know.
Sarah:
Yeah, yeah. No, it’s definitely one of the larger areas of friction that we recognize. To the extent that it’s interesting when you think about it from a direct-to-consumer perspective or context because I definitely went into this eyes wide open, as to this is a category that’s going to be harder to convince people to go to a separate, online destination to buy the products. Because in my past, I’ve been in shoes, I’ve been in apparel, I’ve been in beauty, and for all of those, especially something like shoes or swimwear, I would argue it’s easier to convince someone for a one-off special purchase, like glasses, to go to a separate destination.
Sarah:
But to your point, with the cleaning products, this is a product that even early surveys have found that over 80% of people would prefer to just purchase these either in brick and mortar stores or just as part of the shopping that they’re doing regularly anyways, whether it’s weekly or biweekly grocery shopping, whether it’s all on Amazon or at their local Target or Walmart. And I think that because of that, retail will definitely have to be an important part of our future. At the moment we are still a most all direct-to-consumer business. We have a handful of retailers that we sell through but still pretty minimal like we’re with Goop or with West Elm, we’re with Nordstrom. But I think-
Stephanie:
Those are some pretty good names.
Sarah:
Yeah. Those are definitely great names, but those are more I think we still view brand enhancing names and not necessarily the place where people are going to every week to traditionally buy these products. But I think it all comes back to focus and we also always knew that direct-to-consumer was going to be an important component of launching the brand. I think there’s so many benefits, especially from a brand building and story telling perspective and explaining the mission and as a new brand to market just explaining who we are. And it’s certainly an efficient enough channel to be able to get to early adopters and a set of consumers. But we do believe that if we are going to truly maximize our environmental impact and reach as many households as we can, then absolutely, we do need to, at one point, go into retail, physical retail and traditional retail.
Stephanie:
Cool, so, how do you get in front of the early adopters that you just mentioned? What kind of digital channels are you exploring? How are you doing your marketing? How are you finding customers and bringing them back?
Sarah:
Yeah, yeah, definitely. Instagram has been an invaluable channel for us, especially on the organic side. I think we’ve had great success there. So, we’ve been live for probably just about a year now, we have over 170,000 followers on Instagram, all of it organic. We haven’t really done any paid influence or promotion or anything. And I think it’s really helped that because our mission is so integrated into our product offering, we are a mission driven company but that could mean different things for different companies. And for some companies that means it’s a donation that they’re making or a philanthropy in addition to whatever their core product or service is. And for us, our mission is just 100% integrated into the products that we sell. And that’s given us the ability to, on social speak across a range of topics and speak more broadly about climate change and plastic pollution and tips on how we can each do our part.
Sarah:
And it’s been so exciting to see how much that’s resonated with the community on instagram and how quickly we’ve grown and it certainly is one of our largest channels. So, it’s exciting to see that organic is something that that can work for a direct-to-consumer brand.
Stephanie:
Yeah, especially if you have that. Sustainability is a hot topic right now and like you said, if you’re able to lean into those groups and people and tags and stuff, that opens up a whole new market where maybe other DTC companies who are just trying to sell their product and create brand new content, very different. So, it seems like that’d be a very helpful way to get new customers and access to an audience that maybe you wouldn’t get access to otherwise if you weren’t building a sustainable product.
Sarah:
Definitely, definitely, definitely. And it’s also been a really great amplifier for word of mouth. I think we’re fortunate that we have a product that people feel more inclined to share. So, everyday we get hundreds of people story-ing our products and their unboxings. And I think that’s being driven by two things. One is just the mission I think that gives people a real reason or additional reason to want to share our product with their friends, because also saving the planet is something that we have to do together and they understand that the more they can raise awareness for things that help this planet, to their friends and community, the better place we’ll all be in. But also, our products are very visual and experiential. The process of making the solutions, dropping the tablet, showing the tablets dissolved.
Sarah:
I was very worried, before we launched Blueland that that would be one of the largest hurdles to our success because undoubtedly it is more work for a consumer than just going out and picking up a bottle of solution. But I think it’s hugely benefited us, especially in a world with video, Instagram stories, et cetera.
Stephanie:
So, when you’re thinking of the health of Blueland, as you’re building it, what kind of metrics are you looking at? Specifically maybe around your website and how to know if you’re really doing well?
Sarah:
Yeah, it’s definitely starting to get a lot more complicated now that we have so many more products. I think early days it was a lot simpler … I would say early days it was a lot more straightforward given … I think over 90% of our new customers were coming in through the same kit. They were all purchasing our four piece kit. And because it that initial basket was pretty uniform, it was much easier to track those cohorts over time and understand both acquisition behavior and success as well as retention behavior and success. I think now, as we look at our business, there’s a lot more granularity. We’ve layered in more fragrances, we have at this point I think six different kit permutations that you could opt into.
Sarah:
There isn’t a clear kit that all new customers opt into. We also have many people that are adding refill packs now to their kits and their first purchase, which changes the way we have to think about repeat curves and retention because a customer, if they’re loading up a dozen multi-surface cleaning tablets in their first purchase, that’s actually a great thing for business. It drives higher AOP, it’s certainly also better for the environment because we’re only shipping that package to them once and they may not need another package from us for a year, at least on the multi-surface cleaner side. But as you can imagine, we then need to look at our data in a much more nuanced way and cut in so many more different ways to really understand what is happening. But yeah, largely we are very focused on customer acquisition cost, the conversion on our site at every part of the funnel and then repeat basket size based on original basket size and channel.
Stephanie:
Yeah, that makes sense. So, is there any best practices when all of a sudden you have a lot more data to work with and you’re trying to actually see trends and parse out the noise. Is there anything that … I’m assuming with your finance background, you’re probably already very good at data. I also have a finance background and how long I had to be in sheets and looking at numbers all day was crazy. But, you do learn how to actually parse through large data sets. Like, what are some best practices that you say worked when it came to expanding your product catalog and actually trying to find trends and things to pay attention to?
Sarah:
Yeah, absolutely. I think the main thing is making sure that you’re being thoughtful about the tests that you set up and setting them up in a way where the data will be valuable and also just taking into account what you’re in or how much volume you’re getting and so not trying to test too much all at one time. Because I think, and I bring up testing because sometimes it’s hard to look at just the organic data that you’re getting and make a determination as to what the value drivers are. So, for example, a question that we’re trying to solve at the moment is that, are there better kits for people to start on? Do we have a preference as to, is the customer going to be more likely to stay with this? Is the customer more valuable if they buy into kit one very kit four?
Sarah:
And it’s hard to look at the data that you have without setting up a clean test because there maybe other factors that have driven certain consumers to a kit one versus a kit four, that would then make their retention characteristics different. So, to do a very clean test, you would want ideally place randomize and drop off a set of consumers to either kit one or kit four and then see if those two cohorts perform differently over time.
Sarah:
But it’s just making sure that we’re being really thoughtful with the test, making sure that there’s not other confounding variables that we’re introducing, like for example making sure we’re using the same ad creative to drop people off on kit one versus kit four, taking into account, again, how much traffic we expect to drive, how quickly that test will wrap up. Because certainly you could think, “Well, we’re going to do this test for kit one through seven and do seven kits that we’re landing on.” But it may also just take forever to get any type of answer of statistical significance if we’re dividing up our volume in that way.
Sarah:
Yeah, so things like that. But certainly something that we’re thinking a lot about and is certainly far from straightforward.
Stephanie:
Yeah, tough problems to solve but I’m sure very informative and helpful for the future. So, I know we don’t have too much longer but I did want to ask, we’ve been on a Shark Tank kick lately, we’ve been a couple of companies who’ve been on Shark Tank before you as well, and I wanted to hear-
Sarah:
Awesome.
Stephanie:
… very high level, doesn’t have to be a really long story, but how the experience was for you and how you dealt with the increase demand and your inventory and everything that came after being on the show?
Sarah:
Yeah, yeah, yeah. What a wild experience. It’s always actually been facetious, half serious dream of mine to go on shark tank. So, it was really exciting. I think we over prepared every step of the way, which was right in terms of I don’t say that negatively. But everything from leading up into the pitch, to making sure that we were ready from a site perspective. Our team still says today that we’ve never been so prepared for anything outside of Shark Tank.
Stephanie:
That’s amazing.
Sarah:
So, it’s something that we always point to, even with our new product launches or other things that we’re trying to do. Because especially in startup world, you’re rushing, it’s never … And we always point to, “Look how well Shark Tank went, because we spent the time, we were organized, we put the time in and it definitely pays off.”
Stephanie:
What kind of things did you prepare? If you were to look back and say, “These two things were the best things that we did to prepare? Or what were some of the levers there that you were working on?
Sarah:
Yeah, yeah, definitely. So, I think before filming on that side, it really was all hands on deck, full team for that week leading up to our Shark Tank filming we pretty much focused on Shark Tank. Especially Syed, our head of R&D and myself were going to go into the tank. But even the rest of the team, we were required probably at least twice a day, for about an hour and a half each, so about three hours a day, whole team would be on just grilling us every which way, with the hardest questions they could throw, with the most inappropriate questions they could throw at us.
Stephanie:
That’s fun.
Sarah:
It’s fun. And it was, in the beginning it definitely was incredibly embarrassing because it was so hard. You’re just like … But after that, it really did prepare us for anything that could come our way in the tank. So, that was great. Including lots of, they just threw lots of mental math at us, which if anything, I don’t know if they got us better at mental math that it got me better controlling my facial expression when I didn’t know something.
Stephanie:
Yeah, or just delaying the response so long they forget what they asked, maybe?
Sarah:
Exactly, exactly, exactly. So, that was very valuable. And then from a site perspective, we really did everything we could possibly do to make sure that the site didn’t come down. We spoke with a lot of other companies who had aired on Shark Tank to get their tips for what to do, and that was really helpful. Like the guys at Plated had a landing page ready. Because their site did go down. And so, they were very thankful that they did have a landing page ready to capture email addresses. And they were able to capture a ton of email addresses that way and then email the people when they were back up and running. So, we did that. Someone, another company had a really great idea to swap out all the videos or gifs we had running through the site. So, anything that was heavy that takes up a lot of speed or memory and just pairing back to replace all the videos on our site with images. Again, just to lighten up the site as much as we can.
Stephanie:
Cool. Yeah, that definitely seems like some good due diligence. And you guys ended up getting a deal, right?
Sarah:
Yeah. We ended up getting a deal with Kevin O’Leary, who has been fantastic and really supportive and shockingly accessible.
Stephanie:
I was going to ask that, do you actually get time with him and is he actually helpful?
Sarah:
Yeah, yeah. We get a lot of-
Stephanie:
Give me all the gossip.
Sarah:
Yeah. We get a lot. Early days, I was like, “Is this too much time? I have other things to do.” But we probably speak by phone or text once every two weeks or so. And definitely-
Stephanie:
Wow.
Sarah:
Yeah, yeah, and [crosstalk 00:52:50]-
Stephanie:
That’s way more than I actually thought.
Sarah:
Yeah. Yeah, in early stage I feel like I was talking to him multiple times a week, especially right coming off of Shark Tank when we had a lot of opportunities and he brought us onto QVC the week after Shark Tank aired.
Stephanie:
Oh, nice.
Sarah:
We’ve done multiple press interviews on TV together. It’s been great. It’s been really great.
Stephanie:
That’s really cool. Yeah, thanks for sharing that story. So, now we’re running out of time. Is there anything you wanted to cover before we jump into a quick lightning round?
Sarah:
No. I think we covered a lot of ground.
Stephanie:
All right. Cool, well, let’s jump into the lightning round brought to you by Salesforce Commerce Cloud, this is where I will ask you a question and you have a minute or less to answer with whatever comes to mind.
Sarah:
Okay, great.
Stephanie:
Are you ready, Sarah?
Sarah:
Yes, let’s do it.
Stephanie:
All right. I’m going to start with the hardest question first because you’ve been in the industry for a while and I feel like you’ll have a good answer to this, what one thing will the … Oh, let me rephrase that. What one thing will have the biggest impact on Ecommerce in the next year?
Sarah:
Ooh, in the next year. Oh, that one’s harder. In the next year … I would say packaging. It’s a non-traditional answer. But I do feel like we’re seeing the tides are shifting. I’ve just started to receive my first set of Amazon packages that for once are coming in paper based envelopes instead of plastic based envelopes. And I think that’s going to send a great signal to the industry of, “We need to be a lot more thoughtful about with all this Ecommerce comes an incredible amount of packaging waste and consumers are becoming so much more knowledgeable and mindful about the waste that they’re creating.” And I think we’ll start demanding this stuff of companies.
Stephanie:
Love that answer. What’s up next on your reading list?
Sarah:
What’s up next on my reading list? So, I’ve been incredibly inspired by the Black Lives movement, Black Lives Matter movement. And so, I have picked up a ton of books in that process. And my next one actually, by my bed right now is White Rage.
Stephanie:
Nice. And have you started it yet?
Sarah:
I have not started it yet.
Stephanie:
Cool, we’ll have to circle back and let me know what you think of it.
Sarah:
Yes.
Stephanie:
If you were to build another company, which I feel like you will probably be doing in your lifetime, what would that next company be?
Sarah:
Oh, geez. That’s so hard, that’s so hard. that’s so hard because I love the company I’m building at the moment. I always tell my co-founder that I don’t think I’d want to sell this business because I don’t know what I would work on next. It’s just an incredible mix of product development, science and really doing things that I believe will make a huge difference in the world, as well as just educating people in areas outside of our products, which has been incredibly gratifying, just being able to talk about … Email’s probably a couple times a month and certainly social posts multiple times a week where we’re just talking about things that have nothing to do with our products but just ways that you could cut out single use plastic from your day to day life. I do think that if I do move on past Blueland, it certainly is going to be something around the space as well in terms of where-
Stephanie:
Sustainability.
Sarah:
Sustainability, exactly, sustainability and climate change.
Stephanie:
Cool. It would seem sad to throw away all the knowledge. I’ve heard that quite often where a lot of times founders will just get eager to move onto the next thing and they don’t always properly value all the knowledge they built up either from their current company they’re at or what industry they’re in. And so, yeah, that seems great.
Sarah:
Totally.
Stephanie:
What’s up next on your Netflix queue?
Sarah:
So, next up on our Netflix queue is season two of The Politician. I know I’m a few weeks late, but I’ve actually heard that … my husband and I loved season one and we heard season two there’s actually a lot of focus on plastic pollution and there’s actually a character who’s really leading the charge on eliminating plastic from her and other day to day lifestyles, so, it’ll be interesting to see their spin on that.
Stephanie:
Yeah. No, that sounds cool. Yeah, there’s also a series, I don’t know if you’ve heard of it, it’s with Zac Efron, which at first I was like, “No, how is he going to do a series on big problems and sustainability and things like that?” It’s actually quite interesting. They …
Sarah:
Oh.
Stephanie:
I’m trying to think what it’s called. Maybe producer, Hilary can look that up for me and put it in our notes here. But yeah, he went through, first he visited Iceland and was showing there all of the renewable energy that they generate for Iceland. And then episode two was talking about water and it went into France’s water system and how they purify it in a much better way than a lot of places in the U.S. do it, so, another one to just put on your radar. But I don’t know the name of it, I just know Zac Efron’s hosting it.
Sarah:
No, that’s great. I haven’t seen him in anything since High School Musical so I’m actually-
Stephanie:
I know.
Sarah:
… excited to see him all grown up.
Stephanie:
I know, when I saw him on there I was a little bit confused. I was like, “Wait, what?” And then I was like, “Okay, yeah. You’re doing a good job. This is cool.” Oh, let’s see, Hillary put it in there. Down to Earth with Zac Efron. Pretty good one, very interesting.
Sarah:
Great. Great, great, great. I’m going to add that to my queue.
Stephanie:
All right. And then the last one that I’ve recently started asking, what is the number one tool or app or technology that you use day to day that’s most helpful to you or that you either learn the most from or that you loved the most?
Sarah:
Yeah. It’s got to be Instagram. I wish I had a more creative answer but …
Stephanie:
No, I love Instagram.
Sarah:
… I learn so much from others and from incredible resources and I think most recently I think the Black Lives Matter movement has been an eyeopening one for me in so many ways and I think in so many ways that we’re trying to even as a company make sure that we are sustaining that moment, but really have been grateful for that platform as a source of education.
Stephanie:
Yeah, yeah, completely agree. All right, Sarah, well, it’s been so much fun talking to you about this. Where can people find out more about you and Blueland?
Sarah:
Yeah, so, people can check out our products and learn more about our products at blueland.com. You can also follow us along @blueland. And I also post lifestyle tips frequently to my personal account, @spaiji. That’s S-P-A-I-J-I.
Stephanie:
Awesome. Well, thanks so much for coming on the show and we will definitely be following along in your journey.
Sarah:
Amazing. Thank you so much for having me.
