Episode Transcript
[00:00:00] Speaker A: Welcome to Intentional growth, a show that teaches you as a business owner and entrepreneur to view and run your company like a financial asset, which will allow you to enjoy work, create wealth and make an impact. This mindset will help you focus on building a more valuable business and give you the choices to grow, acquire, reinvest or exit and live the life you plan for all with intention. And now, here's your host, Ryan Tansom.
[00:00:30] Speaker B: How's everybody doing? Thanks for tuning back in. I hope you're enjoying this show. If you are, my request would be is please go on your podcast player, give the show a rating, share it with a friend. It does a huge amount for me and the show as we're constantly trying to level up our guests and we have some really good things in store for the show. We're going to constantly try to level up the content. We're putting some serious thought behind the content and the strategies that we're going to be putting into the show. So please go on to your podcast player, give it a rating, share it with a friend and on to our guest today. His name is Jonathan Bestin and he's a serial entrepreneur and digital ad expert and owner of a 60 million direct to consumer company and a Wall Street Journal bestselling author. He's been honored by the Ink 5000 numerous times and the book that he just got done writing is the least likely millionaire. How to succeed when everyone else expects you to fail Jonathan was hospitalized twice due to mental illness, told by teachers he was never smart enough, and was told by colleagues in his corporate world that he lacked the skills he needed to start a company. And Jonathan today shares his journey of managing his relentless energy and thoughts that were often destructive for him. And he shifted his mindset and how he funnels them now into creating the business that has led to his success.
[00:01:39] Speaker C: As well as a life that he.
[00:01:41] Speaker B: Thinks is worth living. I think this is a super relatable podcast and a conversation because the battlefield for all of us is both in business and the six inches between our ears. The latter is sometimes more difficult than the former. Thanks everybody for tuning in and I really hope you enjoy this conversation with Jonathan.
[00:01:57] Speaker A: This episode is brought to you by Arcona's fractional CFO services. Arcona's fractional cfos integrate into your management team and assume the responsibility of the CFO. They become your strategic financial partner to help you run the business, create your value growth plan, and build the financial roadmap to the valuation you want to achieve.
[00:02:20] Speaker C: Jonathan, how are you, man? Doing well? Happy to be here. Yeah.
[00:02:24] Speaker D: I'm excited.
[00:02:26] Speaker C: You and I, when we were doing.
[00:02:27] Speaker D: Our prep call, I really enjoyed just. I mean, I could tell we went right into the deep end. It's essentially right how I felt, and I'm excited to jump in. So you came out with a book. Why don't you just give everybody kind of a cliff note of what the book is and what your message is? Because I think the authenticity that you had on our first call and our prep call was why I'm excited to jump in because I think the listeners appreciate your story.
[00:02:53] Speaker E: Yeah, well, thanks, Ryan. I genuinely enjoyed our prep call as well. And I was excited to be on the podcast and appreciate you mentioning the book. So the least likely millionaire, how to succeed when everyone expects you to fail, is really a memoir about my life. Some specific things that occurred, a lot of them negative, on the kind of trajectory of my life and how I was able to overcome all of that to achieve kind of life changing success, and how there are some actionable steps that I think other people can take who read the book that can use that as a tool to kind of harness some things I talk about, take some steps to either start a business, change their life in meaningful ways, but things like overcoming debilitating anxiety, depression. I was hospitalized as both an adolescent and adult for severe mental illness. I've been on kind of roller coaster of cocktails of all different kinds of psychotropic medications, been off and on. And ultimately I was able to kind of harness this power that I call healthy obsession, which is kind of. I know I have these kind of symptoms of anxiety, racing thoughts. How can I channel that into something positive that's going to benefit my life? And ultimately that's what I did. And I was able to start with nothing. Scale. My first company, single swag from zero to 60 million in under five years. It's a top 200 inc. 5000 company, top ten company as far as growth in the state of Florida and do it profitably and kind of change my life and the course of my family's life in the.
[00:04:41] Speaker D: Know, there's barely anything there to unpack, right.
Honestly, Jonathan, I love it because one of the things that I've been passionate about recently is just like just getting rid of the veil, the vanity metrics, and making sure that, hey, what are we all doing here? You know what I mean? Because there's been so many people on the show that have made a bunch of money, and then they figure out like, hey, I was solving for the wrong things and I want to talk about the mindset shift that you've had over the years, how you got to the point where you're now able to talk about all this stuff and you overcame it all.
[00:05:15] Speaker C: And I know that I should say.
[00:05:18] Speaker D: It probably wasn't easy. So what was the mindset as a kid that you had?
Do you look back and say, okay, here's how some of this stuff started? Give us some of that context?
[00:05:31] Speaker C: Yeah.
[00:05:31] Speaker E: Well, I think, really, I acted out a lot as a child because I was looking for attention I didn't get. My father kind of left my family to move to another state. My parents got divorced when I was very young. And not only that, but did some really toxic things. One thing I talk about in the book is that I had this kind of culminating event in my life of bar mitzvah. And it's something that I was a 13 year old kid, invited friends and family, and my father got up in front of the congregation or the group and made, instead of, like, congratulating me on this kind of life achieving milestone, made a speech, badmouthing me, badmouthing my mom for not inviting him to the party. Kind of a very embarrassing, very toxic situation that's tough for a 13 year old to overcome. And I don't even know if I had the perspective on that type of how that situation affects someone as a child, as I do now as an adult. And I spent a lot of time alone. I was an only child.
My mother worked as a teacher, and then aftercare every day. So I just kind of had myself, I never really had a lot of friends growing up, and I think I don't share all this to, I guess, look for empathy or get sympathy for pity.
[00:06:57] Speaker D: This is your truth.
[00:06:57] Speaker E: Yeah. But I think what's important that I talk about in the book, and I think if I didn't go through all this adversity, and these are just a few examples of the kind of adversity, and as I was a child, there's kind of a lot more. If I didn't go through that, I would never have achieved what I achieved, and I never would have done what I'd done from a business perspective. And I also was a serious marathon runner. I became very disciplined in what I did, and I learned how to do things. And a lot of people, even when I was starting my company, told me very deliberately in an overweigh, how I was never going to be able to do this, how this company was never going to be able to succeed, how I wasn't going to be able to do it without raising money, which I did, how I wasn't going to be able to build kind of a brand that was marketed towards women without involving women. So I was told all the reasons why it wouldn't work, why I wasn't smart enough, why I didn't have the right education, the right background, the right experience, and ultimately, I did it myself. And I think I learned a lot along the way. If I were to start another business today, would I do things differently? Yes. Did I make a lot of mistakes? But ultimately, I'm not really necessarily sad about the things that occurred in my life where I am today. Because now if you look at kind of my life on a bell curve, and I've done this exercise called a lifeline before, and it's like a thicker, yeah.
Rocking.
A lot of the beginnings of my life, my teenage years, my childhood was in the bottom of the, trending downward. I had a pretty positive experience as an undergraduate at Florida State, and then trending downward, some as an adult. But ultimately, now, for the last seven years, I've had this company written the book, things have been on an upward trend. Not everything has been totally positive, but that's kind of how I look at it. And I'm happy to share these things. I'm happy to be transparent, particularly about the mental illness, because I feel like there's a stigma, societal stigma associated with that. And not everyone is willing to talk about it, although it really does impact.
[00:09:22] Speaker C: A big portion of the population.
[00:09:24] Speaker E: I mean, I don't think that everyone necessarily exhibits it like I did with suicidal ideation, with thinking about things. But anxiety is very common. Stress is very common.
[00:09:36] Speaker C: Jonathan, are you seeing that people are mean?
[00:09:41] Speaker D: It's less of a stigma, because I think when our prep call, I shared that my mental health has run through.
[00:09:45] Speaker C: My whole family, mental health issues.
[00:09:47] Speaker D: And I feel like I say, like, nick me, because I got the productive monkey mind where I funneled it. And I think that's what kind of your theme is, how to channel that.
Before we get into how people can do that and how you overcame some.
[00:10:04] Speaker C: Of this stuff, my question is, so.
[00:10:07] Speaker D: Your book, when you wrote it, or.
[00:10:09] Speaker C: Where you're at right now, are you in a spot of peace or are.
[00:10:15] Speaker D: You in the spot of, like, this is for resentment and to kind of give the fu. To everybody in your past?
[00:10:23] Speaker E: It's really an important question.
The way I would answer it is it's kind of a combination still. I think that a lot of what motivates.
[00:10:33] Speaker C: Yeah.
[00:10:35] Speaker E: A lot of what motivated me as I was building my business. And a lot of what still motivates me is proving people wrong. And people told me I can't do something fu, I'm going to go do it. And a lot of the reinforcement of that, writing a book, getting recognized in national news, being on the Ink 5000 list, being able to post those on social media to kind of quiet the haters or put that out there, it's kind of like, for lack of a better word, kind of like a drug. It's something that I thrive on, and it's something that is very motivating to me. At the same time, there can be some toxicity associated with that from my perspective because it's never enough. So if I have these people, the people I'm trying to prove it to from high school, from when I was younger, that treated me like trash, that called me white trash, that made fun of me, are not a part of my life. I mean, my son is a part of my life, my immediate family, my mother, who's involved in my business, who I talk about in the book, my friends that I have now, those are people that are meaningful to me. And a lot of times I find myself stuck on thinking about the people that are so removed from my life. But I can't get over this whole insecurity of proving them wrong. So I feel like I aspire to get better about that and to live in the moment and enjoy the success I've had. But it's not always that easy to overcome some of this deep rooted stuff from my past.
[00:12:17] Speaker D: No, I appreciate the answer, man, because the reason I asked, too, is because.
[00:12:22] Speaker C: I think it's energy that could fuel.
[00:12:24] Speaker D: Some cool stuff like you've done, right? And I've experienced the same thing. But also, if resentment becomes the reason.
[00:12:32] Speaker C: It'S gross, essentially, over time, right?
[00:12:37] Speaker D: So how to balance that in a healthy way?
And I think about myself, my family members, some of the listeners might know my dad built our business to prove to the world that he was worth something and that everybody can go pound sand.
[00:12:51] Speaker C: And the moment he dealt with that.
[00:12:53] Speaker D: Is the moment we hit this. The things kind of unraveled, which then I had to come in and we had to deal with this together.
[00:13:00] Speaker C: It's always about this refinement of the motivation.
[00:13:04] Speaker D: And hopefully, at the end of the.
[00:13:05] Speaker C: Day, we're all spending, we fall asleep.
[00:13:08] Speaker D: With our eyes staring at the ceiling by ourselves.
So whatever's going through our head, it's not the other people that are sitting there and how to make sure that that transition or the focal point is.
[00:13:19] Speaker C: The right focal point, and it's tough.
[00:13:22] Speaker D: How along your journey and your lifeline did you bounce into these situations where.
[00:13:27] Speaker C: You were able to reflect back and.
[00:13:31] Speaker D: See what was going on? Because I think sometimes in my past, when I've been stuck in the hamster wheel, there was something recently, I was like, oh, my God, a couple of months ago, I didn't see that at all. Now I do. And I can tell you what just that comment, Jonathan, is. I didn't see it before. Now I see it.
[00:13:47] Speaker C: That was a son of a bitch.
[00:13:48] Speaker D: To get from point a to point b, personally. You know what I mean? And emotionally. So how did you go through those?
[00:13:57] Speaker C: Does the question make sense, or is there certain points?
[00:14:01] Speaker E: Yeah, I think it definitely makes sense. I'm not sure that my answer will make the most sense. I'll try to articulate the best way, but I think doing things like this can be very therapeutic. And I mean, actually talking these things out or doing an exercise like writing a book and kind of reliving things that I had buried very deep in my emotional state. Like things like that incident I described at the bar mitzvah, being involved in hospitalization as an adolescent and as an adult for mental illness. I mean, these are the types of life events that I try not to think about. And that now, when I'm actively talking about them and I'm actively writing about them and I'm actively being asked questions about them, it does give me the perspective to know everything that I've overcome and that where I am today is totally different than where I was. But I think it's definitely a work in progress. I'm still a work in progress. I think that for me, the way that I look at kind of mental illness and the reason why I kind of have this method of dealing with it is because this is not something for me that's ever going to go away. This is something that's genetic. It's part of how I operate. So I can't have an idle mind. If I fully retire and I have nothing to focus on, I'm going to get incredibly depressed and I'm going to get incredibly anxious. Being overwhelmed at times is healthy for me because it gives me things to focus on, that ultimately, if they're positive things, if I'm not going out and wasting money or doing anything crazy and I'm taking care of my family. But I think that this is something that I have, this is something that I need to continue to deal with and that I think affects other people too. And that's really what I try to do on a daily basis.
And it's kind of become second nature in a lot of ways that now I can kind of focus on the right things.
For a long time after I was hospitalized as an adult, I even needed to read myself testimonials. And I have a list of testimonials that I had kind of read about this kind of technique where I told myself that I could do certain things and I spoke out loud to myself until eventually I feel like it became second nature and it became part of my being and just the way that I operate because that's kind of what I needed because this just never goes away.
[00:16:57] Speaker D: I appreciate that, man. And I want to get into some of these techniques that you talk about. And by the way, I don't know if.
[00:17:03] Speaker C: Are you familiar with Peter Atia?
[00:17:06] Speaker D: Peter Atia is this doctor that wrote this book called Outlive, and he was on Rogan recently, and she's this brilliant dude. And at the last chapter talked about emotional stability. It's like 500 pages about how to outlive and how to have perfect your body.
[00:17:19] Speaker C: And then he's like, the most important.
[00:17:21] Speaker D: Thing is your mental health. And then he talks about how he struggled with it. And that's why I think it's awesome that you're out there sharing this and.
[00:17:26] Speaker C: We'Re talking about this stuff, because I.
[00:17:29] Speaker D: Think, Jonathan, that there is a huge, disproportionate amount of entrepreneur founders that this is the driving force behind their business.
[00:17:39] Speaker B: It's what I saw.
[00:17:41] Speaker D: I have a component of it why I've been doing this over the last ten years, and I know my father did, and I know a lot of the people, out of the 400 people have done the show that have the same thing. And my curiosity is like, and what I hope that this show does for people is that helps them get to the point where you're at of awareness.
[00:17:58] Speaker C: Without this massive regret or something like.
[00:18:01] Speaker D: That at the end where they're chasing everything and then it's like, shit, wrong.
[00:18:05] Speaker C: Goal and it's over.
[00:18:07] Speaker D: Yeah, you know what I mean? But there's at least a time for restart. Button. One of the things before we get into the how and the tactics that you can help us outline is how.
[00:18:18] Speaker C: Those like the bar mitzvah or your hospitalization, what are some of those?
[00:18:25] Speaker D: So those are traumatic events that probably instilled certain behavior or decision frame mental models that you were running by that it sounds like you've overcome. So what were the original mental models that were dysfunctional.
How did those behaviors show up?
[00:18:47] Speaker E: Yeah, well, I think a lot of it has to do with trust and trusting people. And I'll try to answer it this way, and if it's not what you were getting at, for sure, I'll pull it up. Yeah, I think for me, and this really affected me in a business, my first business, some ways negatively, because I just can't trust people. I mean, if I can't trust my own father, that he's going to have my best interest at heart and do what's right for me. And there's not the unconditional trust and love that I have for my kid. And most people would in that situation, who can I trust? Can I trust people that I don't know or employees or relationships or really anyone? And that people. So I think for me, these kind of symptoms manifest themselves in fear, in paranoia, in just total catastrophic anxiety, tree branching. Something very small would occur, and then my thought process would quickly gravitate that to something really catastrophic. So I think that's the way what.
[00:20:14] Speaker D: Would happen then when you're leading a company or you're working with clients or employees or how did that.
And the reason behind this questioning, Jonathan, is I think a lot of people.
[00:20:27] Speaker C: Struggle with this stuff. And so I think about people starting.
[00:20:31] Speaker D: To recognize the Feedback loops and the behaviors is the first step. Right?
[00:20:36] Speaker C: Yeah.
[00:20:37] Speaker D: We're self sabotaging ourselves and we don't even know it. And so it's like. And we could get better if we start recognizing. So what was happening with that lack of trust or the propensity to gravitate towards fear, what would happen in the business or your leadership?
[00:20:51] Speaker C: Yeah.
[00:20:52] Speaker E: Well, I think the way that it worked for me, especially early on, is that I would just close off and, for example, if I gave something to someone else, and even if it was a very kind of simple task and I didn't get the feeling that they were doing it correctly or the way that I would do it, I would kind of take it back. I wouldn't use it as an opportunity, like maybe I would try to do now potentially to coach them to make the right decision. I would say that for me, this was very toxic. For me, having these thoughts was very bad for my business. I would say it's not always that bad. And the reason why is because this fear, this paranoia sometimes allowed me to preempt what my competitors are doing. It allowed me to kind of hyper focus because I thought someone was coming to take what I thought was mine, hyper focus on what they were doing. How can we emulate what our competitors are doing? How can we do it better? Where can we advertise more effectively? Where can we do this? Because there was this fear that all this is going to be taken away from me. A lot of times, very irrational fear, irrational thoughts. People are going to do things to me. I thought that for a while. It sounds crazy I talk about this in my book, but that my dad, who I had an estranged relationship with, was trying to poison me and was trying to hurt me because he would leave me threatening voice messages. So I was paranoid that cleaning ladies or people that I allowed access to my home and my life were trying to kill me, poison me, hurt me in some way, that I would be in public somewhere and I would get jumped or something like that. So really, that's where my ultimate anxiety led me to. And that's what happens. I will say that occasionally, that still happens. Occasionally, I'll get to a very anxious spot and I'll do that. And the things I think about, I recognize them as being irrational, but it's not necessarily something I have control over. But again, I think without some of that, although it's not something I wish for myself, anyone, I think I wouldn't have achieved some of these things because I think a lot of people could have had the idea for my business. I mean, the type of business I started required really no upfront capital. There's not a lot of barriers to.
[00:23:29] Speaker D: Entry from the mechanics. For the listeners, what were the business and how did you get it off the ground?
[00:23:35] Speaker E: Yeah, so this is an ecommerce exclusively ecommerce business subscription box. So everyone orders on our website. I built our first website on kind of a self service platform where we can sign up customers. It's a recurring revenue company, so we automatically recharge people every month. And as long as people. It's very transparent. People can cancel at any time, but as long as they don't cancel, we're going to recharge them. And so customer service is very important. Delivering a high quality product is very important. But what's attractive about it is that it doesn't really require. I mean, I started the company with under $2,000, and within five years, we did over 60 million of revenue.
[00:24:28] Speaker C: Yeah, go ahead.
[00:24:29] Speaker D: That's awesome. I just got to say, that's freaking awesome. You're, like, in the right of the decibel of people that can do that.
[00:24:35] Speaker C: So props.
[00:24:36] Speaker E: Yeah, I appreciate it. And I think just to put in perspective a little bit, this was trending around the time I started it. So around 2016, subscription box were kind of building some momentum. So more people are starting these companies and we operate on this platform. The platform is actually called Cratejoy. I'm not looking to give them a shout out or not give them a shout out, but they kind of had this built full service solution where you could build a website, start taking orders, had some label printing options, hosting the website, recurring billing. And I just mentioned that because hundreds of thousands of aspiring entrepreneurs at that time tried to start these companies, very few of them well under half a percent, even scaled to 1000 subscribers, then 5000 subscribers, then 10,000, because it was so easy for people to start. This ended up being hobby businesses or people couldn't get to the next level. I think a lot of what led to my success is a lot of personal sacrifice.
And people had had. My niche was for single women, and I was actually a single guy at the time. I still am. And I thought that it would be nice to get a gift. And I hadn't received a gift from a significant other in a while. And originally I had the idea for men and women when I did some kind of initial market research, discovered that women were really the consumers for these boxes, that it was important to kind of cultivate a community on Instagram. This was like before TikTok, before some of the other platforms that have popped up lately.
So I decided to focus on women and I made these kind of strategic decisions. It ended up, in my opinion, being the right decisions and know started to advertise on Facebook. And a lot of this kind of goes back to what people told me I could never do.
I had no background in digital advertising. I kind of had a corporate career in financial services. Nothing that exciting, but about a ten year career. I was a branch manager for a bank I talk about in the book, it actually got robbed at gunpoint while I was there. I did some other stuff in banking, that type of thing, but nothing really that great. Never really made a substantial amount of money like I did in the business.
But I taught myself digital advertising and I scaled the ad spend from $20 a day to over 10,000 a day within a year. And I kind of learned that platform and we became kind of an enterprise level advertiser on Facebook, where we're getting access to different betas and know sophisticated account help directly from Facebook. And that's really what ultimately scaled my business.
[00:27:30] Speaker D: That's amazing, man.
[00:27:32] Speaker B: Pardon the interruption. I just wanted to drop a note to say if you resonate with some of the things that Jonathan and I are talking about, that the battle between our ears and funneling our energy into something productive is something that you're working on. I'll tell you what. The business that I have and what.
[00:27:47] Speaker D: I've been working on over the last.
[00:27:48] Speaker B: Ten years has literally has saved the six inches between my ears because it gives me something productive to think about. But then balancing the personal life but also business, is a whole nother challenge in itself. I find a lot of peace in the fact that I know where I'm headed and having the correct amount of effort into what I'm working on and knowing that the momentum and the energy I'm placing is getting me to where.
[00:28:13] Speaker D: I want to go.
[00:28:14] Speaker B: And honestly, it sounds a lot of self servant because it's what we do. But the learning that I've put into it myself and understanding where I'm at and then also having the financial visibility to know that what I'm doing is getting me where I want to go is what gives me peace of mind. So that way I can balance between work and life. And if there's something that I would say to get started, go check out the intentional growth starter kit just to start learning. Because if you start leveling up your education, getting clear on what you want and why, and then understanding how your energy and your time and all your sacrifice that you're putting into the business is getting you where you want to go, I think then you can take a step back and say, hey, I'm going to enjoy the present moment, too. So it's kind of a paradox where the more you think about the future, the actual more you can actually be present because you have visibility in alignment, which I think intentional growth is really about alignment. So thanks, everybody, for tuning in. And back to the interview with Jonathan.
[00:29:07] Speaker C: So how did that mindset of fear, lack of trust, paranoia put rocket fuel behind what you just described?
[00:29:21] Speaker E: Yeah, I think it all contributed. I mean, I would wake up every day and think that this is all going away. I mean, even we would have incredible things happening. I mean, we got to a point where we're getting 20 people to sign up a day, 50 people to sign up a day, 100 people to sign up, 500 people to sign up a day. And I still thought that something was going to go wrong. I even thought kind of the biggest year that we had and the biggest moment that came was during the COVID pandemic in 2020. And I was scared shitless that this was all going to go away, that this was done, that we weren't going to be able to get product. We weren't able to ship product.
We did incredibly well. It was a game changer for me personally, it was a game changer for the business because of some of the advertising variables in our favor that happened during that time and people spending money.
[00:30:18] Speaker C: Some kind of economic variables.
[00:30:20] Speaker E: But I woke up every day and I thought that every situation was the end. And I worked hard to kind of preempt that and to try to do what I could in those moments to make strategic decisions, to do the right thing. And I thought that I needed to, but I also made mistakes along the way. I invested over a million dollars with a boutique marketing agency out of New York that came to me, marketing that they worked with well known household brands, that they offered a unique way to advertise that would kind of supplement what we were already doing on top of that. And ultimately it was a lot of duplication of sales. It was just tossing away money. And I thought I needed to do that because that's what our competitors are doing, that's what others were doing, and.
[00:31:18] Speaker C: We needed that to grow.
[00:31:19] Speaker E: And I even doubted myself. How can I do this myself? What do I know?
I need to bring on this more sophisticated help. But ultimately I did everything myself. And I think a lot of time when I talk to entrepreneurs because now that I've particularly in the subscription box ecommerce space, a lot of people come to me and they want to start a similar company. They want advice, and a lot of times they're looking at the wrong thing. They want to focus on how they can build the coolest looking box or how they're going to do that. It's really about how they can acquire customers for the lowest cost. And people automatically assume, in my opinion, in digital advertising, that you need third party help, that you need to hire an agency. But a lot of these tools, like Facebook ads, now TikTok ads, Google Ads, there's a lot of free resources out there for people to educate themselves, to kind of establish expertise so that if you do, and when you do scale your business and you are talking to these people who do this for a living, you're going to know what you're talking about. I've seen entrepreneurs get taken advantage of by these companies because they have no idea what they're talking about and they're kind of trusting the expertise of these people that are really out for themselves.
[00:32:47] Speaker D: Did you see that in the money industry, too, before you jumped into the entrepreneurship space?
[00:32:52] Speaker E: Definitely, yeah.
I wasn't at that sophisticated a level ever in banking. But yeah, I mean, everybody, I guess.
[00:33:03] Speaker D: A lot of people outsource their knowledge of money. They assume some, there's kind of some commonalities. Jonathan, one of the things that we teach in the academy is creating sustainable, predictable, transferable future cash flow. And it sounds like the innate sense of fear that it's all going to go away. My guess is you created a cash flow machine because you're always worried it's going to go away.
[00:33:30] Speaker C: How did you.
[00:33:35] Speaker D: I'm trying to think about the mindset that you had and the relationship you had with the business that can drive a really good business, like I just said. So if I'm sitting here as a potential investor going, I want the business that Jonathan has created because he's got that dna and he's building machine.
[00:33:55] Speaker C: But how stressful as the person that's in. So, like, were you able to calibrate it or have a healthy relationship where.
[00:34:06] Speaker D: You took it from?
[00:34:07] Speaker C: Like, where you're pruning the toxic stuff.
[00:34:11] Speaker D: Of it, but keeping the behaviors that.
[00:34:14] Speaker C: Is helping you build something that's good?
Yeah.
[00:34:24] Speaker E: I think that I.
[00:34:28] Speaker C: Yeah, I'm not.
[00:34:29] Speaker E: Let me, let me back up. I think it's definitely still something that I'm actively working on. Like, I still a lot of times wake up.
A lot of what I do in the business today is very redundant. So a lot of the actions that I take, and I've kind of been even trying to lately motivate myself in the way that I did when I was aggressively growing the business, because I even talk about this in the book, after the kind of peak of this business, following the kind of pandemic, the business took a little bit of a downturn. And we were actually, instead of the acquisition cost going down, the historic acquisition cost went up. So the two kind of key variables in the business are the acquisition costs, how much we're paying to acquire a new subscriber, and the lifetime value, so how long we can keep someone subscribed. And there was always a negative front end scenario. So if we were always paying between $50 or $60 to acquire a customer, but we're only getting $40 up front. So we're really relying on that lifetime value to gain profitability.
It's really a constant challenge, and there's kind of always a leak in the boat, so to speak, and you're always losing customers. They call it churn, so always losing that. And we were in a position during the kind of accelerated growth from like 2016 through 2020, where the losses really didn't matter because we were acquiring at such an aggressive rate that it outweighed all that. Then we weren't able to do that. Then the acquisition costs went up. I wasn't able to spend as much money. Then I needed to pivot to start making smarter economic decisions, smarter decisions to make this sustainable business. So I think there's been KPIs that.
[00:36:45] Speaker D: You were obviously client acquisition costs, lifetime value customer, and making sure that those balanced out. What were some of the KPIs that.
[00:36:53] Speaker C: You were monitoring and measuring specifically throughout.
[00:36:57] Speaker D: This pivot to make sure that you.
[00:36:58] Speaker C: Were doing the right stuff?
[00:37:00] Speaker E: Yeah, I think one of the biggest things is that we moved from working pretty much exclusively with third party brands in our boxes. So we would buy product from brands you would see in Ulta, Sephora, Nordstrom, to a model where we start to.
[00:37:18] Speaker C: Manufacture a lot of their own products.
[00:37:20] Speaker E: So I actually went overseas and we worked directly with overseas factories to build our own products. And everything that goes in a box, it's all about perceived value. So it's about if we were to put a $200 necklace that was in a Ziploc bag versus a $5 necklace on a beautiful card inside a velvet pouch, or a velvet, seemingly velvet pouch, that's going to be more attractive, that's going to be more attractive to the end consumer than the $200 zip up bag. That's just the reality that we found. So that's one of the biggest things that I did strategically, was to move our production and the product that we're getting, and that reduced the cost of goods sold. So that also increased our kind of gross margin, our profitability in the business, because there were some variables that we couldn't control. I mean, there's always a variability in the shipping costs.
There's other things. I had to make some difficult decisions on my team and how I can operate this business. What's the optimal number of people that I can operate with our customer service time, responsive time, being at a certain rate, how many people do we need to get back to people with eight or 10 hours? We're sending boxes all over the world. We're getting incoming messages 24 hours a day. So how can I optimize that with minimal costs? So I think ultimately, the biggest KPIs in the business for me, come down to acquisition costs. And the way I measured that is just being crazy in a way. I call it a healthy obsession, but being very looking at the Facebook ad.
[00:39:16] Speaker C: Performance, which is highly analytical as far.
[00:39:20] Speaker E: As cost per click, cost per acquisition roas. I mean, all this stuff, looking at it multiple times a day, making real time changes, making constant changes to the creative that we're using, trying to identify what we call evergreen creatives, the stuff that's going to work indefinitely. Playing with ad copy. I wrote a piece of ad copy that produced millions. When you're the love of your own damn life and just doing all these other things, the other thing that I did strategically was I bought another business. And I found ourselves in 2020 sitting on a lot of excess inventory. And I was thinking of a way to get rid of some of this excess inventory that we had. Because we always ordered inventory, whether it was from a third party ourselves, trying to exceed the demand. We never wanted to run out of product, we never wanted to not be able to. We always marketed it as the fear of selling out. But I never truly wanted to sell out, and we ended up sitting on a lot of stuff. So a lot of smaller subscription boxes started to buy product from us. And there was one that's actually located where I am in South Florida that I could tell that was still buying product from us. Their numbers were going down. They weren't really that excited about the business, and I offered to buy the business. That business called paradise delivered. At the time that I bought it, they were sending out under 100 boxes a month and had been doing it for about three to four years. Within a year, we were shipping out over 10,000 paradise delivered boxes a month. And I really, how many boxes do.
[00:41:02] Speaker C: You ship out now?
[00:41:04] Speaker E: Not as many as we used to, but so around between the two brands. Singular.
[00:41:09] Speaker D: Answered. If it's too confidential, just curious.
[00:41:12] Speaker E: No, it's not.
[00:41:12] Speaker C: Confident?
[00:41:13] Speaker E: Yeah, I'm happy to share around 15,000 a month. We shipped though over 3 million boxes.
[00:41:22] Speaker C: Since inception.
[00:41:27] Speaker E: At our peak. Just to give you some perspective on how the business has evolved, at our peak, in kind of June, July of 2020, we were shipping closer to 50,000 boxes a month.
[00:41:40] Speaker D: That's crazy, man. So you buy this company, did they know what value that they had or.
[00:41:45] Speaker C: What you could do with it?
[00:41:48] Speaker D: How was that experience buying a company.
[00:41:51] Speaker C: For the first time?
[00:41:53] Speaker E: This was a relatively simple transaction. I had a lawyer that does a lot of kind of transactional stuff for me, review contracts. I've had a few kind of lawsuits that I deal with over disputes over products, that type of thing, but I've never really had anything serious legal issues with the company. But he kind of drafted a relatively simple document and I don't think they did. And I think really a lot of the value of growing that it was in my head. I mean, we used the same techniques that I had exhibited, engaged in the same activities I did with single swag, with paradise delivered, and it was the right timing. So 2020, if I would have acquired this business in 2022 or 2023, when these advertising variables had already shifted, when other things. So it was a combination of a few factors. One of them was timing. But what made it very profitable is that we didn't have to buy the product for these boxes. We could essentially use the product, the raw product that went in the boxes. We only had to buy the boxes. We only had to create kind of some new brand assets, build the new boxes type of thing.
But yeah.
[00:43:18] Speaker C: I wish at that time.
[00:43:19] Speaker E: I had bought a few more brands and I had kind of rolled up a few of these companies because I felt like that was really when the time was right to strike, when the iron was hot. And what's happened in the last couple of years is that a significant amount of these companies that had scaled during the time that I scale my business, let's say from like 2015 to 2022, have actually gone out of business, have either sold at a significant discount, and we've bought kind of the assets of multiple companies in kind of liquidation situations. So they've had maybe 50 to 60,000 units of product that we took to use in our business. They've had some email list assets that we've acquired. It's become a lot more challenging to operate. So I'm kind of trying to keep our head above water at this point and hope that there's a shift in some of the variables that go back to how they were when we were.
[00:44:19] Speaker C: Able to scale or hope that we see it.
[00:44:23] Speaker D: Here's a couple of observations that I have. I don't know if they're right or.
[00:44:26] Speaker C: Not, but I think going back to.
[00:44:29] Speaker D: A couple of the phrases you've used.
[00:44:31] Speaker C: Is your healthy obsession, where instead know.
[00:44:34] Speaker D: Focusing on the fear and paranoia and all the stuff that you had been exposed to in the past.
Dude, you're a freaking data scientist. And like, that's what it. And like, I think about, and like, I had this guy, Rob Green, on the show recently, and we were talking.
[00:44:49] Speaker C: About the product brand arbitrage.
[00:44:54] Speaker D: The game's kind of like I never got into it. Jonathan, I've just been doing the podcast long enough where I got exposure to all these entrepreneurs. I had 115 employees with my dad. We had a couple of million in inventory.
It was a machine with a lot of stuff. And I remember looking at these companies.
[00:45:11] Speaker C: Like, these aren't companies. These are, like, people in their basements doing.
[00:45:15] Speaker D: Martin but then as people, what Rob and I were talking about is he.
[00:45:19] Speaker C: Then got into the manufacturing because it was brand building.
[00:45:22] Speaker D: They got into manufacturing. Like, you got a company, you got you're building your own products. It's a company. And I think a lot of these other people, it was more of, like, a shingle that looked like it was a company.
[00:45:31] Speaker C: And when I think about your healthy.
[00:45:34] Speaker D: Obsession is you're really good at it. You've spent probably the 10,000 hours to do this versus the 10,000 hours of having an idle mind. And what I find fascinating is how little we talk about this online or in the culture of entrepreneurship is, like, it's not that easy, dude. I can't imagine.
I never once was, like, I could do ecommerce tomorrow from someone that does it all the time. That looks really hard.
[00:46:04] Speaker C: And so talk about how your path.
[00:46:08] Speaker D: To learning this like this and how that maybe compares to some of these other brands and how that healthy obsession.
[00:46:15] Speaker C: Has allowed you to.
[00:46:16] Speaker D: I mean, I don't know. I'm assuming you enjoy it or you don't enjoy it. Talk about this healthy obsession and how.
[00:46:21] Speaker C: That'S gotten you to where you are.
[00:46:24] Speaker E: Yeah, that definitely has gotten me to where I am. And I think the way that I think about it, from my perspective and that I think will resonate with a lot of listeners or just a lot of people, is that when I have these symptoms, primarily of anxiety or symptoms of stress or these racing thoughts or unable to kind of control it, and if I can channel that into thinking about my business from every angle into things like we've talked about preempting what my competitors are doing, going above and beyond, thinking about all the marketing, the acquisition tactics that I had these kind of brainstorming sessions where I would just sit there and I would think about, what can I be doing more? I'm not doing enough. I was about to go to sleep. I need to stay up longer because I need to think of more ways that we can do this. I need to send out more emails to prospective companies that we can partner with for product. I need to answer more customer service emails because that's going to keep people subscribed longer and become more advocates. So it became exciting to me. It became a healthy obsession because I was excited to do what I was doing.
I wouldn't say that the excitement, I'll be honest, has kind of always stood the test of time, but particularly when the company was scaling at the aggressive rate that it was.
I was just excited about everything I was doing and I was making a lot of personal sacrifices in my life, things that I had always done. I mean, going out for drinks with friends, watching tv, going to see movies, I basically went dark.
I was like in a zone where I was just hyper focused on doing these things and not sleeping a lot. I mean, I used to think prior to this business that I could not function on under seven or 8 hours of sleep. I learned pretty quickly that I could function. I don't think that's sustainable for the most healthy lifestyle long term, but I was able to do it and I was able to still think at a high level. And I think that really, I'm not a genius. There's nothing that's really that unique about me from my perspective. I just was willing to do a lot of these hard things. I mean, when I talk about teaching myself Facebook advertising, with no background of Facebook advertising, this is building kind of an account structure. And when you're spending over 10,000 a day on your own, that's pretty sophisticated.
[00:49:11] Speaker D: The wrong way, you burn in cash.
[00:49:14] Speaker E: We have hundreds of ads, lots of different targeting, retargeting. I mean, this is lots to look at, lots to manage, and it's really not easy. And you really need to have that expertise to be able to make the right decisions. Then, yeah, it was my own money. I've never had an investor. I've never raised money that's been beneficial to me personally and my family, because I've been able to take money when I want. I've been able to use the business to kind of fund my life and do great things for myself. But I never had anyone besides myself, and I was never even willing to pay anyone else that people told me. And maybe I would have been another level. Maybe I would be a lot richer and a lot better off if I would have been willing to hire the type of talent to give them equity to people that have done this before, people that are incredibly well educated or have.
[00:50:13] Speaker D: Do you think you'd be capable of having that? Yeah.
[00:50:17] Speaker E: Well, I think that's my personal challenge, is that I wasn't capable of that at that time. I may not even be capable of that now. I mean, I've had people offer to roll my business up and become a part of larger businesses and essentially agree to work for somebody else. I mean, I don't think that I would do well in that situation. And I also think that I don't do well kind of trusting other people, particularly people that I'm paying a lot of money to. But do I think that's always the right answer now, looking back on this from, like, a holistic view, looking down on it, no, I think it is important to potentially hire the right people. I think a lot of my mental ailments, insecurities, trust issues, even prevented me from having even more success because I was only willing to do things and I really only trusted myself. And really for a long time, my only other employee for multiple years when I was making a lot of money.
[00:51:18] Speaker C: Had a big business, was my mother.
[00:51:21] Speaker E: The one person in my life I could unconditionally trust and that I knew had my best interests and make decisions. But this is also, at the time, mid to late 60s person who was a retired teacher, kindergarten teacher.
[00:51:37] Speaker C: Awesome.
[00:51:37] Speaker E: That was not a tech ecommerce entrepreneur, had no kind of background in that. But for me, it worked because it was someone I trusted, and that's kind.
[00:51:48] Speaker C: Of what I needed.
[00:51:49] Speaker D: Jonathan, I find the whole journey so fascinating, and I can totally picture being in your eo forum of going through the lifeline.
Yeah, I find it fascinating. You seem so self aware of all of these tendencies, your past, how to manage it.
Was there any triggering point, or was the book and the process of reflecting? Because somehow you got to the point where you're on this show, having this conversation, and I don't know about you, man, but every time I get awareness, it's because I get hit in the face with something. And then I had to deal with it to get over to the other side. And maybe I could learn a lot from you about how to avoid that pain. But I'm curious, man. Was there one thing or something or a sequence of events that got you.
[00:52:40] Speaker C: To the point where you're comfortable talking.
[00:52:44] Speaker D: About this in kind of like an awareness observer perspective?
[00:52:49] Speaker E: Yeah, I got to a point. Well, it's really twofold.
I think the book helped bring a lot of that out, and I had some help writing the book, and I kind of did some interviewing and did some self reflection.
[00:53:05] Speaker D: Did you intend to do that with the book, or did the book morph.
[00:53:10] Speaker C: As you were doing it?
[00:53:13] Speaker E: Yeah, I don't know if there was a lot of intent.
I think it became more intentional as the book kind of progressed and as I started to kind of articulate these concepts that have always been in my.
[00:53:30] Speaker C: Head or that have been in my.
[00:53:31] Speaker E: Head as I was building this business. So I think that all kind of came together. But.
[00:53:40] Speaker C: It wasn't easy to kind of.
[00:53:43] Speaker E: Get to that place of awareness.
[00:53:50] Speaker D: I'm happy for you.
[00:53:51] Speaker C: It's awesome. I appreciate it. Yeah. Because like I said, every part of.
[00:53:57] Speaker D: My awareness has come from me going through some serious pain.
[00:54:03] Speaker C: Go ahead.
[00:54:04] Speaker E: No, I was just going to say that I think one of the things that it ultimately became once I saw the final product with the book, and this is not a self promote, first of all, I had a goal in mind with the book. So I knew that my business may not be there forever. I knew that my business and my business is still sustainable for multiple years. It's actually still great lifestyle business, still producing a lot of revenue.
We've pivoted in different ways. We're selling a lot of one off ecommerce products, like mystery boxes in addition to subscriptions. So we've done some things to continue to try to grow the business. But I wanted to create more opportunities for myself. I wanted to, in some ways, monetize my story and use the book as a catalyst to get in front of different groups and to share this story and to help people overcome certain things and to overcome seemingly insurmountable obstacles or toxic family issues and achieve what they want to achieve. And that's really what I want to do with the book. And it wasn't all just for my sanity. I do have some strategic things. I haven't achieved many of them yet, still kind of early in the process. But that's really my goal, is to really get my story out there as much as possible and ultimately become even a thought leader in mental health and entrepreneurship and really build.
[00:55:36] Speaker D: There's a lot of opportunity there, man. I think there's a lot of people that need some is so I've really enjoyed the conversation, Jonathan. I really have.
I'm trying to think, is there anything, any part of your story that we.
[00:55:52] Speaker C: Haven'T unpacked that you feel like you want to share?
[00:55:56] Speaker E: No, I feel like we've covered a lot. There definitely is more in the book.
[00:56:04] Speaker C: Pick up the book. Right? Pick up the book. Pick up the book.
[00:56:06] Speaker E: Pick it up. It's available pretty much everywhere. Books are sold online.
It just recently came out on audiobook. But yeah, I think I definitely shared a lot. And there's more. But I'm always happy to connect with individuals, even in the book. There's some where they can link.
Yeah. So jonathanbeskin.com, Instagram at jbeskin. They can email me. Jonathan at singleswag two s isinthemiddle.com or go to singleswag or paradisedeliver.com websites, but yeah, happy.
[00:56:46] Speaker D: I got one last question for you, man. The name of the show is intentional growth. Love to hear people's definition of intentional.
[00:56:53] Speaker C: You got any thoughts about what that word means to you?
Yeah.
[00:57:01] Speaker E: I guess the word that comes to mind is being deliberate. So being deliberate about what you're doing.
I like to talk about discipline a lot. I kind of learned this in marathon running. I learned this with my business, the importance of being disciplined and being focused. And I kind of think some of those things are synonymous with intentional. And that's kind of how I think about it.
[00:57:29] Speaker D: Jonathan, thank you so much for coming on the show, man.
[00:57:31] Speaker C: I had a blast. Thanks for having me, Ryan, appreciate it.
[00:57:34] Speaker D: Thanks for listening into that conversation. I hope you found the time valuable. If you enjoyed the conversation, please leave the show. A review on your podcast player. We're constantly trying to up those reviews. It helps a lot with the visibility and if you didn't catch the commercial in the middle of that episode, there's two different ways that we can help you. One is if you want that kind of clarity. We have a coaching program that is based on the five intention growth principles and uses the material to help you get that kind of clarity on your target equity valuation and income that you need on the way towards that valuation, what you want from the business long term and why, and then how to get aligned with your leadership and your partners. So that way everybody's working in the right direction to get you what you want. And the second way is if you want to jump right into the data and you want to actually build out your financial roadmap with your three statements and tie your financials and your operational data to that target equity valuation. My team offers a complimentary financial assessment. Either way, all you have to do is go use the link in the show notes below. Schedule a discovery call with me. We can walk through your situation, figure out if there's a fit or not, and if not, I can point you in the right direction. Thanks everybody for tuning in and I hope you enjoyed this episode and I will see you next week.
[00:58:44] Speaker C: You our channel.
