Dr. Jeremy Weisz: 08:37
How did you find them?
Brian Nolan: 08:38
We met the owners of the brand who’s also a husband and wife team that owned it. They were using a broker. They were interested in finding a, you know, somebody else that could take over the brand because they had two young kids that had been born during this process, and they’d been running the brand for eight years. So they enlisted a broker to try to find somebody that they trusted that could take over their brand. And so we were looking and got in contact with the broker as well and got to meet them. They came out to the US and we got to spend some time with them and their family. And it, you know, we started off as sort of partnering with them and, and eventually took over the brand. So it was a good match.
But, you know, we underestimated a few things around the founders social media presence and the engagement that drove and trying to we can’t just step in and try to be her or replace her. And so part of this has been, how do we make this our own brand? And how do we become now the face of it and our dog rather than her dogs, that that brand is named after? And so those have been some of the challenges. And we’ve realized over this last year that we really need to put a spin on this brand and make it our own. And so what started as a little bit more of a novelty type of brand, where the prints were cutesy and had a lot of dog illustrations on them and things like that. We’ve tried to evolve and turn into actually premium quality apparel that you can wear out at any time that still with the matching element of with the dogs, but human first really.
So what do humans, they’re the ones pulling out the credit card. What do they want to wear? What is their identity as you know, what, what is it about? And then also offering the matching dog options for people who actually, you know, want to have their dog match them as well. So that’s kind of the transition we’re in. And it’s, you know, so far it’s going pretty well. But, you know, nothing’s ever easy.
Dr. Jeremy Weisz: 10:53
There’s a virality to that for sure. Right. It’s like, I mean, if you’re listening to the audio, I was showing the site up and yeah, it’s just nice stuff that you could wear, right? They have t-shirts, they have hoodies, they’ve sweatshirts, they have vests, they have pajamas. But the dog is matching, which is cool, but they look nice. But there’s a virality to seeing. Oh, immediately. Oh, there’s a matching for my dog. That’s cool.
I’m curious what your criteria was. One, you know, I guess had the, you had a software company, right. Well you had a company that you were buying in bulk and selling online. A lot of people start in e-commerce. Then you have software. You had the you know, people are always strive. I want a software company one day with recurring monthly revenue. And now you go back to e-commerce. So we’re what type of, when you’re looking right, you’re like, I want to buy. You obviously were looking. We want to buy a business. What were your options there? Were you like, yes, I want to buy an e-commerce business. And you just found this. What were your criteria that you were discussing with your wife?
Brian Nolan: 12:12
So good question. You know, you’re right. I started in e-commerce. I was working for an online retailer as well, selling stuff on selling power tools online. I had my own little side gig where, where I was buying stuff in bulk and selling it. From that came the SaaS business, Sellbrite, which was a inventory order management system that helped you sell on Amazon and eBay and everything. And so I was solving my own problems there. Which, you know, turned into a business. But I got to this point after that that, you know, I’ve always loved having tangible product and being able to show people what we actually are making, rather than having to pull up software and try to explain it to them. So I was drawn to that. Now that’s a much harder business than software, in my opinion. And, you know, harder cash flow management with inventory, worse margins. So a lot of people thought, I still think I’m crazy for wanting to do that. But we looked at all kinds of businesses actually.
Dr. Jeremy Weisz: 13:20
You did okay.
Brian Nolan: 13:21
We were thinking, what about if we just buy, you know, the trend right now is like buying old, boring businesses like old, you know, service business, HVAC business, or your local landscaper from this, you know, boomer generation that’s retiring and their kids don’t want to take it over. And so it’s like, maybe we just do that. But I don’t know. I wanted to wake up every morning and be excited about what I was doing. I don’t know the first thing about running an HVAC business, nor am I excited or passionate about it. So I was leaning more towards let’s, you know, look at e-commerce. And we found this business that had really good metrics and really good repeat customer rate, good social media following good unit economics in it. And, you know, I will say, I influenced my wife a little bit to go down this path and buy this type of business, rather than the original idea of.
Dr. Jeremy Weisz: 14:19
Were you looking together at the time also with your wife, or did you just come about and you’re like, this is perfect for both of us?
Brian Nolan: 14:25
What was? I didn’t, I missed the question.
Dr. Jeremy Weisz: 14:26
Were you looking to buy a business with like teaming up with your wife from the get go, or obviously this is kind of a natural fit for the two of you, but was that the original plan?
Brian Nolan: 14:39
Kind of. Yeah. Two things happened at the same time. One was I sold BookOutdoors and right then, right around that same time, my wife, who’s in corporate HR, got laid off from her company. She was at a tech company that got actually taken private by private equity. And so they did a bunch of layoffs. And so we were both sitting there without a job and nothing to do. And so that’s kind of how it came about. We never worked together before, but.
Dr. Jeremy Weisz: 15:07
We’re going to start a company or kill each other. We should just start a company. No.
Brian Nolan: 15:12
That’s right. So yeah, it was something for us.
Dr. Jeremy Weisz: 15:16
It seemed perfect then like, I mean, you could both run a plumbing business together, but like that’s, I don’t know how fun that would be. But so this comes across. I’m curious. So when you take this over, right? Obviously you are an expert at building businesses, right? You’ve done it multiple times over. You have two exits. Most people don’t exit their company in general. What were some of the first things you did with the brand and the company?
Brian Nolan: 15:49
Ooh. Let’s see. I mean, there was kind of a lot to do. Obviously there was a lot to learn. So it took probably six months working with the sellers to really just learn all parts of the business, right? There’s product development and working with source, you know, suppliers and factories overseas to actually make the product. There’s all the marketing and all the e-commerce side of things. Fortunately, I had been working with Shopify quite a bit and had been partnered with Shopify. So I knew Shopify really well. I knew, you know, technology systems really well. So those things came easy to learn and just kind of figure out where they are with things.
Dr. Jeremy Weisz: 16:31
Darren & Phillip is built on Shopify. I take it.
Brian Nolan: 16:34
On Shopify Plus. Yeah. Got it. But there was a lot of things they weren’t doing as well. So or, you know, had not the greatest, greatest system. So a lot of it was going in there and looking at, you know, our, how do we collect product reviews? How do we do, you know, what are they missing? Where are there opportunities for us to grow? They weren’t on Amazon at all. So getting on Amazon, you know, how do we just do more to drive growth of this business.
And so that was probably the first six months. And then it was when we started realizing, okay, we need to actually put our own spin on this brand. So then it shifted more towards what can we do from a brand, from the tone, the look of the brand? We did a minor logo tweak just to sort of signify that this is a new chapter. And it wasn’t a whole rebrand, but repositioning. But also just product development. Where do we want to go with the product? Are we going to phase out this look and bring in this new look while kind of keeping selling through what we got? And, you know, so a lot of it was out over the last year probably of doing that.
Dr. Jeremy Weisz: 17:47
Talk about challenges, I mean, inventory, I think e-commerce is always a challenge. And I get sweaty thinking of a clothing and apparel brand because there’s different sizes, there’s different colors. How do you manage all of that? You know, it’s not like a print on demand thing. Like you’re basically you can go on. There’s, you know, there’s a lot of inventory here.
Brian Nolan: 18:10
That’s the hardest part, honestly. And probably the area that I have the least experience in. So we not only have human sizes, but we have dog sizes, seven dog sizes. So it’s a lot of thank God for AI that can look at our sales and help me figure this stuff out, because a lot of it is projecting what’s been selling, what sizes sell best, you know, where do we need to reorder? We do have minimum order quantities. We are doing everything custom. These are our own custom prints, our own custom cuts.
So we’re not just going on Alibaba and like ordering something. These are all custom. So it’s got to be product development custom. When you’re doing custom prints on fabric you have minimum yardage quantities. So how do you divide that up between the human clothes and the dog clothes? And how many do you need to order? And we haven’t been perfect at that. And, and we have inventory sitting in warehouses that we’re trying to move. And sometimes you just got to discount it to move it.
You know, we did a lot of holiday pajamas, family pajamas, which are great. They’re great for Christmas. But we also did Halloween and Easter, and we tried to load order lower quantities of that. But you know, those are dangerous too, because if you don’t sell through those, they don’t. Then you’re kind of.
Dr. Jeremy Weisz: 19:33
You gotta wait till next year?
Brian Nolan: 19:34
Yeah. You wait till next year or you’re sitting on inventory that is not going to sell and you just need a discount. So we’re learning and I’m part of this process is what can we make that we can do lower quantities and move faster? And we’re looking at suppliers in the United States for that purpose too. You know, they’re obviously more expensive, a lot more expensive, honestly. But we can also control that supply and that inventory a little bit more.
Dr. Jeremy Weisz: 20:05
I want to get to some of your, you know, for the e-commerce folks out there, some of your favorite Shopify apps and, and things that you like to use. But before we get to that, what’s it been like working with your wife? What have you learned from that end?
Brian Nolan: 20:20
We have to stay in our own lanes. That’s how you don’t kill each other is stay in your own lane.
Dr. Jeremy Weisz: 20:28
How have you divided that up?
Brian Nolan: 20:30
She’s definitely more creative than I am, like artistically creative, right? So she’s good with the prints and trying to and she’s a woman. And most of our customers are women. So trying to figure out what women would wear and buy and colors and things like that. So. Social media, we’ve probably an area we’ve struggled to really embrace. It’s, you know, it’s hard to make content every single day. And we had some help with that as well. But people want to hear the story and see humans in social. And we need to do a better job of that. But we kind of split that. And then I’m more on the like tech. So, you know, marketing side of things. And, and the, the website and all that.
Dr. Jeremy Weisz: 21:24
Speaking of that, any favorite Shopify apps or tech that you are using, obviously using Shopify plus, what are some of the other kind of tech platforms that you like?
Brian Nolan: 21:36
God, we use quite a few apps. One that I was just playing with today that I like is called stock STOK, I’m sorry, STOQ. They’re the app you put in there. So when you are sold out, somebody can sign up for the notify me either SMS or email, but that’s great because that also shows you what people are interested in. And it helps with reordering and then alerts them right away when you get the stock in.
So that’s just top of mind because I was using that this morning and playing around with it.
But and then I mean, I use a ton of AI right now. Claude has a connector for Shopify, so it can pull in all our analytics from Shopify and make suggestions on that. You know, and ChatGPT we use quite a bit as well. I feel like ChatGPT is a little bit better on like the brand tone and copywriting side of things. But Claude is really good on the planning and strategizing side. So those are the two I probably use the most every day and tool in terms of tools. Yeah.
Dr. Jeremy Weisz: 22:41
What about transition from the, it sounds like the previous owners were very helpful. They stayed on. What did you want to make sure happen as far as the period of time from a transition for them to stay on and teach you the ropes around everything?
Brian Nolan: 22:59
Well, lesson learned there too, you know, and I had been through two acquisitions on the seller side. And in the case of the first one with GoDaddy, I had to stay on for two years. Now I understand why they want you there for two years because six months goes fast. We only asked for six months from the seller and lesson learned. I probably should have at least done a year, to be honest, to smooth out the transition, both in terms of learning the business, but also her presence on social media and making that more of a smooth transition than just a cut off.
And I, if I could go back, I probably would have tied more of the selling price into milestones. So I did that a little bit, but probably not enough. And, you know, that really would test and I guess what we did, what we sort of assumed was that things would just keep going and sales would keep going as they were and growth would keep going. But had we tied some of the purchase price to that or more of the purchase price to that than, you know, we would have gotten maybe more effort from the sellers to.
Dr. Jeremy Weisz: 24:19
There’s more incentive.
Brian Nolan: 24:20
Yeah. So those are some of the things I would change if I could do it again. But you know, they’re very nice people and we’re still, you know, in contact with them every once in a while and talk with them and stuff. So that’s all great. But. Yeah, that’s probably what.
Dr. Jeremy Weisz: 24:41
It’s interesting because like you experience this from the seller side and probably didn’t think twice about some of these things. When you’re the buyer, it hits home. But like, what was that transition like when you because I know when you sold Sellbrite, you worked for GoDaddy for two years. What was that transition like for you? I mean, especially as an entrepreneur now you’re head of product or whatever you are.
Brian Nolan: 25:10
Yeah, well, I’ll mention one thing here too, is the benefit I had from selling the GoDaddy is they during due diligence, they sent me this massive Excel spreadsheet of all the stuff they wanted to see from our business. And I was able to use that when I was going and buying a business. Now, not all of it was relevant, obviously, but it was definitely a good starting point.
The transition was interesting. So I spent two years at GoDaddy, great company and great people. I really enjoyed my time there. The first year was pretty similar because they still had me running my team and nothing changed that much, right? They wanted to keep the ship moving. So the first year went really fast and felt pretty similar. But for the second year, some of my team members started going to other projects and other departments. I started taking on other employees under, you know, as direct reports that I didn’t hire and and started doing some other things and doing a lot more monthly business reviews with the CEO and more corporate kind of stuff, right? Whereas in a startup and a small startup, if we needed a piece of software, I would just give them my credit card and we’d have it five minutes later.
With GoDaddy, there was like security, you know, questionnaires, and it took a month to get the same software, right? So those kinds of things. Being an entrepreneur and really loving the startup environment, moving, going to a corporate space was a little bit painful the second year. But, you know, not too bad.
Dr. Jeremy Weisz: 26:49
How does that work at the end of the second year is like, okay, you have a conversation around, are you staying or going at that point? Or do you let them know ahead of time? Or is it like, oh, this is a two year stint? And thanks, Brian, for your service or you’re leaving. You’re like, I’m an entrepreneur. I’m going, how did that conversation work at the end of the stint?
Brian Nolan: 27:11
Yeah, basically like that. I mean, there were. There were retention bonuses tied in for me and my co-founder, year one and year two. So it was, we were really incentivized to stay. But yeah, you’re basically it’s no different than leaving a job. I mean, we gave our notice, I gave, we both gave plenty of heads up. You know, I probably gave two months’ notice. And so a lot of it was transition. And the last few weeks was really just like, you know, support and answering questions or whatever.
But I think GoDaddy acquires a lot of companies. I mean, they have a whole acquisition team and M&A team and everything. And so they’re used to founders leaving after a couple of years. They just understand that it’s not. Most founders don’t want to stick around at a corporate company.
Dr. Jeremy Weisz: 28:09
What strikes me with okay, so at that point, for Sellbrite side, you bootstrapped it for a while, but then ended up raising money, right? Right on the Sellbrite?
Brian Nolan: 28:25
We didn’t raise that much. We only raised about a million and a half. So our first we had a little bit of angel money, but we got the first check was 250 K from a tech incubator in Pasadena called Idealab. And that lasted us for quite a while. So that 250 lasted a while. And then we went out and raised a little bit more money from angel investors and at one point did like a debt instrument as well, but it was only about a million and a half total, no true VC money. And it was in tranches of like a few hundred thousand at a time, sort of as we needed it. So it felt still very bootstrapped, like we still had to be really lean. And there were some close calls where we weren’t sure how we were going to make payroll, but we somehow got through them all.
But, you know, I really actually, in hindsight, liked the bootstrap way of things, even though we couldn’t maybe grow as fast as we had wanted to. It ended up leaving my co-founder and I with 50% of the business when we sold it. So there’s that. That’s the part of the upside, right? But versus with BookOutdoors, we went out and raised a $5 million pre-seed before we even launched based on our track record. My co-founder, and that was Roy Rubin, who’s the founder of Magento, another big e-commerce platform. So based on our track records and mostly his, but a little bit of mine, we were able to raise a good amount of money, and it was a different environment and the pressure was higher to spend and grow faster.
And I actually didn’t like it as much as I thought I would. I thought I was gonna be like, oh. You’re just, I feel like we’re, I was maybe this is my own fault, but like less thoughtful with every dollar and it just felt more pressure when you’re burning 200 K a month or whatever, you know, just made me have anxiety over trying to at least be. When with Sellbrite, we were so bootstrapped, like we had to at least breakeven every month or close to it. And that’s just a much better feeling when you go to bed at night.
Dr. Jeremy Weisz: 30:53
Mentors, Brian. Maybe with Idealab where there’s some, you know, mentors and good advice that you got from that early on with Sellbrite for sure.
Brian Nolan: 31:05
I mean, Bill Gross is the Founder of Idealab, and he’s started over 100 companies in that incubator. I mean, Idealab is really an incubator for Bill’s ideas, mostly. We were one of the few companies that they invested in and brought in. So Bill and the team, his wife Marcia, and the team there all had tons of experience with startups. So we got a lot of great advice from them early on. And that was just super helpful back in the day.
Dr. Jeremy Weisz: 31:40
Do you remember any specific advice you got from the team or for Bill that helped you along the journey?
Brian Nolan: 31:51
You know, from the very beginning to get the 250 K investment we had approved that there was more demand for what we were building. So basically what we had at the time was a very small version of the product, the SaaS product that became Sellbrite. And our pitch to them was, we know we can add on all these other features and charge, rather than charging 40 bucks a month, we could charge 250 a month. And that was our thesis. And they said, well, you need to prove that.
And so we took a page out of The Lean Startup, Eric Ries’ Lean Startup, and built a Sellbrite page that looked like the product was live. It was called something else before Sellbrite, but we built something for Sellbrite, different website with a price page where we had three different price plans and packages and everything, and put some ad dollars behind it to drive traffic to it, and recorded which one people were selecting and then told them, you know, there’s a wait list or, you know, launching soon sign up and we got to 100 sign ups right away. And we took that data back to them and said, okay, you know, this is why we think so it proved our theory, but that was sort of a very early lesson from the very beginning of like, you need to prove out, demand and prove out. And there’s ways to do it without building out the whole thing first and risking everything. So that was really interesting. And that was something Bill had done quite a bit with all his businesses is what’s the MVP basically, what’s the minimum viable product you can build or show people to gauge interest and see really if you got something there worth investing in any.
Dr. Jeremy Weisz: 33:38
Yeah, that is interesting. Any learnings from Roy from the BookOutdoors?
Brian Nolan: 33:48
I mean, Roy and he’s got a partner named Roy. Now they have a VC together called R-Squared. They have a ton of experience. Roy Erez also is a successful operator with an exit. So I learned a lot from them, just around raising money and talking to investors and pitching and storytelling. And, you know, the right way to frame the business and prep and talk to talk to investors. So that was really quite a bit what I learned from them.
Dr. Jeremy Weisz: 34:27
Any of your favorite resources? It could be books. Like obviously you’ve had a lot of really good colleagues and mentors in the journey, but I don’t know if there’s any favorite books or podcasts that you point to that have also helped you.
Brian Nolan: 34:43
Ooh. That’s interesting. Well, I mentioned the Lean Startup. I think that’s a great book. It’s a little bit old now, so I haven’t read it in a while. It might be slightly dated, but I think the ideas are still valid. There’s a few different groups of people like I’m in Colorado now, so there’s a Colorado StartUp group, a Slack group basically here. There’s another Slack group that I’m part of called CTO Slackers that’s mostly tech CTOs or founders that just have tons of insight. So a lot of it is the network and just reaching out to people and getting introductions.
You know, I like the guys over at the My First Million Podcast. Sam and Shaan have great guests on and just talk about great companies. And you can learn quite a bit and get some ideas even sometimes, you know, it’s an hour podcast and you just get one little idea that you want to go try and implement. So I think they do a good job of that as well.
Dr. Jeremy Weisz: 35:48
I think one thing I got from Brian, your interview with William Harris. Obviously, you guys have known each other for a while. Yeah. Was, you know, how important culture has been for you in the different companies. And so can you talk a little bit about some of the things you implemented? You know, especially in this remote world, and it’s not always easy to get in person. And some of the things you did to help with culture at the companies.
Brian Nolan: 36:20
So I had the experience of both really Sellbrite. My first company was pre-pandemic and it was all in-office. William has actually worked with us. He was one of the only guys that was remote. He was in Minneapolis, but everybody else really was in the office. And then with BookOutdoors, we were fully remote and I, maybe I’m old school, but I totally prefer in-office five days a week. I am a proponent of that because I feel like the energy and just the ability to learn from each other and build that culture is so much easier to do when you’re with people in the same room and you’re going to lunch with them, and you’re just passing each other in the hallways and chatting and. You know, people say like, don’t talk about your startup like a family, but we really were like a family. And I’m still really good friends with all those people in that startup. And we just had a little reunion in LA not too long ago.
You know, we were like good friends and we stay in touch versus the BookOutdoors experience where we all remote. We got together a handful of times in different cities in LA and Denver, but it was just really hard to get to know somebody when all you’re doing is communicating on Zoom. It’s just different, right? It’s not as it’s a little more awkward, it’s a little more impersonal. And it’s harder to get to know somebody and really what they’re about and what motivates them and drives them. And so I did not like that experience in terms of building a company that way. And now for Darren & Phillip, it still is. Technically we don’t have an office, so it’s technically remote, but I’ve been trying to work with contractors in the Denver area so that I can at least get together more often. And we do photo shoots here. So, you know, they’ll come to the photo shoots or whatever. That helps a lot. I just feel like that makes a huge difference. But yeah, I mean, to get your team to really buy in and care about each other in the trenches when you have to stay late or things aren’t going well or whatever. Like I just feel like it’s so important to be together and to get to know people.
Dr. Jeremy Weisz: 38:41
First of all, Brian, I want to thank you. Thanks for sharing your journey and your story. It’s been incredible. Kind of what you’ve done and the lessons I want to encourage people to check out DarrenandandPhillip.com. I just there’s no more virality. I feel like matching dogs with, you know, matching clothes with your dog. Actually, it gave me a bunch of really good ideas for okay, now I have like a Mother’s Day gift. I have a Valentine’s Day gift I like there’s so many good gift ideas for the people I know and, and my wife too. So anyways, I encourage people to check it out, you know, check out more episodes of the podcast and we’ll see everyone next time with Brian. Thanks so much.
Brian Nolan: 39:19
Thank you Jeremy. Thanks for having me.
