He Built This Business in One Weekend for $40 Transcript, AI Summary & Key Points

So, I knew that I could start it for  close to nothing. Got on Shopify, built out the whole website. No coding  experience. No coding experience whatsoever. That was our first full year. Ended up closing  out at just over a million dollars in revenue. I had a whole weekend to myself. I was like,  I wonder if I just put my head down how far I could [music] go on a website for this.

We  ended up doing over 800,000 in revenue in those two months alone. I [music] launched  in 2019, literally months before the world shut down. And people did one of two things.  I [music] feel like they either got a pet or had a baby. Printer pet absolutely skyrocketed.  So this guy built a 7f figureure business from a $40 investment. But sales [music] are down  and he's out of ideas.

So today we're going to come up with some new ideas so both he  and you can profit from it. Let's dive in. Spencer Chris, how you doing, man? See you. Good.  Tell me about your business. So, Printer Pet is a custom pet gift company where we put your pet's  face, this is my dog, R on different products and SKs that we have on the website. It was actually  born by accident.

I've always had some sort of entrepreneurial drive to start things. And prior  to Printer Pet was working on a pet bandana and scarf company. Weird. It was like these weird  little infinity scarves and bandanas for pets that I had manufactured here in Dallas. And as I  was running trying to run profitable ads for that, trying to run all the marketing, my whole  Instagram explorer page was just inundated with different pet businesses.

And I remember  scrolling one day and I saw a competitor that had pet portraits like this, only it was your pet  in an old timey like Renaissance. I've seen those. Yeah. Yeah. So, I saw that company and I had  seen this style of artwork on different websites for like houses, things like that. And after  seeing the Renaissance portraits, I was like, "This style of artwork would work really well  for like a custom pen thing."

And it just so happened that I had a free weekend where I had a  whole weekend to myself. I was like, I wonder if I just put my head down how far I could go on a  website for this because I'd already known about outsourcing manufacturing with a print on demand  services were really new at that point, but I spent all my days on YouTube just looking up like  running profitable ads, different business types, everything.

I had heard about print on demand, so  I knew that I could start it for close to nothing. And the business I was running at the time with  the pet scarves and bandanas was making money was not making near enough for me to live off  of. I was teaching. This was after I quit my full-time job in commercial real estate and I was  teaching fitness classes.

And that was actually what was where I was getting the majority of  my money to be able to live. And I was like, you know what? We'll just try spinning this out.  So, I spent one whole weekend, got on Shopify, paid the $30 for the Shopify membership at the  time, and built out the whole website. No coding experience. No coding experience whatsoever.

Just  a lot of University of YouTube and trial and error and really rudiments. Not even not even Photoshop  skills end up being Canva. So, at that point, I didn't even know what Photoshop was. I was like,  I'll figure it out on Canva. I'd used Fiverr and Upwork before for different services. So, if it  really got down to needing some photos, did that, took some of my own photos, ended up launching  that next week.

And I launched in 2019, literally months before the world shut down. When all of  that happened, people did one of two things. I feel like they either got a pet or had a baby.  Yeah. And Printer Pet absolutely skyrocketed. the pet bandana and scarf company stayed constant  and ended up shutting down that business running this full-time by complete chance.

I was talking  to a friend who said that type of product would do really well on Etsy and so we were already  running sales directly through our side and the business was doing well well enough for me  to be able to pull money from it. I don't have to invest in any inventory, anything like that.  It was a pretty uh cash flowheavy business and I was able to supplement my rent, everything, low  overhead at that time and I put the products on Etsy and that's where everything really just  hockey stickked and blew up.

2020 ended up being seven figure year in revenue. Holy cow. Which was  insane. And trying to figure out how to scale with that was a whole thing in and of itself. At the  end of 2020, we had 80 artists on staff that were not full-time artists. They're paid commissions  for per per artwork. Uh and then three full-time employees at that time, all of which were  remote.

So, I was leveraging kind of remote employees to be able to take care of everything.  So, what month did you officially launch to the public? November of 2019. Okay. Super late 2019.  November. Okay. And did you have paid ads when you launched? Like you had paid ad experience or  no? So I had paid ad experience. I had wasted a lot of money on meta ads.

When I launched Prorep  was completely organic and me posting about it, telling people about it. So your launch was  just you like personally posting Instagram, Facebook, check out my thing. Yep. What And what  was your first month like with regards to revenue? First month was low. First month was just over a  thousand dollars in revenue and a lot of that was attributed to friends and family that I told about  it.

So it was a low first month. Second month we saw that climb as soon as we started implementing  some ads which was month two I was like okay I think this thing has legs. I thought the business  model was really attractive. the fact that I didn't have to stock up on inventory because  with the previous business that had been a whole nightmare. Learning all of that.

Finding a group  of people to be able to sew all these bandanas and scarves and source fabric and do all these  things was just a little bit of a nightmare. So, I was like, you know what? Let's put some money  into metads and everything. That's when we started running our basic Facebook ads and we were able to  get up to $3 to $5,000 second month. And then Can we sketch it out?

Yeah. Yeah. Yeah. Absolutely.  So 3 to 5,000 second month. Yeah. So month one we were around $1,000 in revenue and all that was  just friends, family, you know, and and luckily we launch right around Black Friday, Cyber Monday. So  we were able to, you know, kind of piggy back on that a little bit, which helps with the launch.  I call these like unsustainable sales, right?

Completely. Yes. you're not doing much especially  because there's we have a lot of repeat customers which is awesome but it's not a product that  lends itself to having a lot of repeat customers subscription exactly it's it's no subscription  it's no supplement anything like that that you know you can get a lot of repeat customers so  month two this is when we started running Facebook ads one of the social platforms I used with the  most success was Pinterest at the time prior to doing all of this when I saw my

full-time job, I  had learned how to scale BA Instagram pages to 10 20,000 followers and then I was flipping them,  selling them. That was all done through like Telegram groups and stuff. That was back when all  the engagement pods used to work well. So, I was using that when I was posting. So, it wasn't just  like me posting to my personal Instagram like, "Hey, look at this."

I I was kind of strategically  going about that. All that doesn't work at all anymore, but back then you could kind of utilize  it on groups. Exactly. Yeah. Things like that. And like you like 10 of these people's posts and  then you post the link to your most recent post and all these different pages with authority.  If Instagram saw big pages liking your content, they would suggest your content to the followers  of all the people with big pages.

So you're able to get some explore page visibility and stuff.  So, I was kind of utilizing that a little bit as well as paying for that's back when different  uh interest pages like a pet page you could pay like 50 bucks and get a post. So, that's what I  started utilizing with Facebook ads, pay post, stuff like that. But, it was like pay 20 bucks  and get a page with 400,000 followers to post a product, which was awesome and doesn't happen  anymore.

And that's when we were able to climb to anywhere from three to 5K. And then month three  was when we started to see a lot of traction. Month three was when we kind of implemented all  the Etsy sales on the Etsy channel itself. So from there on we started seeing about like anywhere  from 10 to 20,000 up until the end of October. Our business is very very seasonal at this point.

I didn't know that. But now I know that we'll do anywhere from 65 to 70% of our revenue is done  in just the months of November and December. So we sustained that 10 to 20 all the way from  month three down to month 10. And you were it was about that same. Yeah. And so the nice thing  about the business is through leveraging overseas labor which by the way I couldn't say good enough  things about the employees we have.

They work so hard. Communication is awesome. We primarily a  lot of our employees are in the Philippines. So much so I was actually looking at getting office  in the Philippines for them to be able to go and work from. But anyways through scaling through  labor overseas and then the fact that we were dealing with all these different screen printing  facilities that we would pay a premium for product to.

So we could save a little bit on margin if  we were to do it in house. but they took care of fulfillment, shipping, everything else. And we  paid them a flat rate where they kind of boiled that into one cost. And so our margin and at  this point the only SKs that we had were posters, framed portraits, and digital files that we  would sell. Obviously, digital files had really, really good margins because all we're paying there  for is the labor for the artwork to be done.

The portraits, the margins were not as great. We were  for certain portraits, depending on the size, anywhere from 40 to 50% margins. So, pretty low on  those. But overall, our margins were anywhere from 60 to 70% margins, which were pretty awesome at  that point, especially when there's no investments necessary for reinvesting inventory, anything like  that.

So, at this point, we are making profit. My gross profit margin was anywhere from like 20  30% a month. So 20 to 30% this a month that I'm making in profit. So on a really good month like 8  $9,000 on a month that's not as good. We're making like 3 4,000 bucks, but luckily my overhead at the  time was not very high. Yeah. So that was your net profit.

Gross is 50 to 60. Yep. Netting 20 to 33.  Yeah. Yeah. And in ecom, like if you really want to push with paid ads, you kind of have to have a  60 to 70% gross margin. You do. Yeah. No. And and that's what I started realizing with ads, which  is why the Facebook ads as soon as we launched Etsy scaled down, became non-existent. Etsy ads  ended up being such a godsend.

But for anyone that has ran ads on Etsy, there's no guaranteed spend  no matter what your budget is. So, for example, right now our budget on Etsy is $1,000 a day on ad  spend. We'll be lucky to hit anywhere from $100 to $200 a day in ad spend because Etsy determines  Yeah. where and it's a pay-per-click, which is really nice where you're only paying for actual  visits to your listing, but because of that, they don't have enough traffic to guarantee that  you're able to spend your whole budget.

And beyond that, you can't get very granular with any of your  ads. You literally check mark a listing and say, "Yes, we want to advertise this listing." And you  have a list of a couple listings that you want to advertise and they choose where that ad spend is  allocated, who it's shown to, like they're they take care of all that, which is nice if you're  looking for handsoff, but if you're looking to actually be able to scale something and grow it,  very, very difficult.

Yeah. And then in those holiday months, so as soon as we got to November,  that's when the ads started spending at $1,000 a day. That's where conversion rates went through  the roof because we have a very giftable product. We see probably 30 40% of our sales are for people  buying them for themselves personally. The other 60% is people buying as a gift for someone  that has unfortunately had a dog pass.

They want to celebrate a new puppy that they got. It's  their birthday and they love their dog and they want something to, you know, have them around the  house. Something like that. Very giftable product which lends itself really well to November,  December time of the year. December with Christmas and then November with all the Black Friday,  Cyber Monday sales going on.

A lot of people will buy gifts then to be able to give to people.  So in month 10 this year we ended up at just over a million dollars in revenue. So up these 10  months until then we're we're at like just over $100,000. So I'm I'm like $100,000 is awesome.  That was always my goal to be able to Yeah. No, for for that first year I was like, if I can do  100,000 revenue, that's like six figures is such a big, you know, like that's what you want to aim  for.

And keep in mind that month one was November of the previous year, December. So, we had another  couple months where we were just seeing about like 150,000 revenue that we had done in 2020. And then  Q end of Q4 2020, November and December absolutely exploded. We ended up doing over 800,000 in  revenue in those two months alone. When I say working 12 to 16 hour days, it was me sitting on  my computer.

I had to learn how to create all the raw files for the products themselves because I  wasn't able to hire employees at the rate I need to hire them. There was a moment where we had to  turn off the Etsy shop because we couldn't handle the influx of orders that were coming in. I was  hiring new artists, trying to do everything. And that was our first full year.

Ended up closing  out at just over a million dollars in revenue, which incredible was insane. Quick word about  today's sponsor, Beehive. They just launched something called community, and it does something  that I've never seen on any other platform. Every newsletter and podcast you publish gets added to  your feed automatically, sitting right in front of the people who already love your stuff.

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The links in the description below. How  big is your email list? email list now is 24,000. Nice. And that's after we prune it every whenever  with like flows people. Yeah. Yeah. We have like a midnight flow and stuff like that if people  end up not interacting with anything else for a while. But the skues we have now are so the  portrait and this is actually this whole flow, this checkout flow is a lot different than it  was initially and we've actually customized a lot.

So now we don't just have the normal block  style portrait option. We have line art which oh is more of a minimalistic look. And then in an  effort to cut back on to make things a little more streamlined and more automated, we also have this  Vogue style which you get to put some text about your pet and it has like more of a modern kind of  and it just uses the photo you send in of your pet as opposed to using our own artwork.

So do you  not need artists for that stuff? No. No. This is all automated completely. I have an employee that  goes through and creates the raw file that we send to the print on demand supplier, but um outside of  that, there's no labor and that takes him a couple minutes. Ends up cost less than a dollar to be  able to make that, which is nice. And then as far as all the framing options, we've extend we've  expanded past just framed posters and digital files.

We now have canvases. We have hanging wall  art that is kind of those magnet poster things and then still posters and digital file. What about AI  like image generation tools? So I I've gone back and forth because it's definitely an option but  one of our different differentiators in the market right now is that we are handdrawn by people and  there are people that will want things removed from certain portraits.

For example, if you  have your dog wearing a bandana and you're like, I don't want having a bandana in the portrait,  we're able to go in and our artists are able to just remove that with any AI. It's tough to be  able to specify, hey, remove that bandana while keeping everything, you know, the same with the  artwork without looking really off. So, we've gone back and forth with it.

And right now, we're kind  of using as a differentiator because there are competitors that are just using AI for everything.  Yeah. But you know AI is also advancing extremely quickly and the image generation just in the past  year has significantly like when I started using any AI image generation just a year ago they  couldn't even get text like text was something that was really tough for all the all the  different generators but now they can get text perfectly.

We actually use AI image generation for  a lot of our blog posts and stuff. But as far as the artwork, that's all done by our artists right  now. And because we are leveraging labor overseas, our cost for artists is significantly less  than it would be here in the US. So it hasn't gotten to the point where it makes sense for the  business quite yet, but it's definitely something we've looked into.

You feel like AI agents could  be good, too, for all the back and forth with a customer. I I'm actually just I just bought a Mac  for a minute. Yeah. For like orphan claw. Yeah. Yeah. So did I. Yeah. Did you? Nice. Yeah. And  that's another thing. I mean, I think one of the coolest things about entrepreneurship in general  is you are a constant student and there's all these new like I have no idea how to work club,  but I guarantee I could go on YouTube and if I spend a week really diving into it, I can figure  out how

to get it up and get it working. So, I think that's one of the things that makes me  love entrepreneurship so much. But that's actually funny you mentioned. Yeah, is I've been looking  into it for sourcing influencers, customer support uh via email and live chat and then just image  generation for a lot of and we already use it for a lot of our blog posts but using it for like  email marketing and stuff.

Yeah. Which has been super fun to dig into. So the um check out for  just the pet portraits has the first page is just choosing your portrait style. How many pets are in  it? You can go up to five pets. And we see a lot of people with multiple pets and they like to be  able to have all their pets in one portrait. So, we'll do that. And then the next step is  going to go to the different flame frame styles we have.

So, we have three different frame  styles. And with the business to get our AOV up, we've been adding in a bunch of different services  that we add that are extra cost to us. But, for example, the red oak frame is an extra $8  for us. we just round out to an extra 10. So that's an extra little bit of margin that we  get with the order, which is nice.

And we have other upsells that you'll see later down the line  that are more convenient for the customer. And if they're willing to pay for it, we're willing to  do like uh we have one where you skip the artist queue and you go to the front of the queue. Not to  the detriment of any other customers. You're still going to receive along the same time frame.

It'll  just depending on volume be towards the latter end of that time frame that yeah other people  can pay to have that moved up. And then we have these premium design backgrounds where we hire an  actual artist to go in and they design those. So this second step you get to choose the size, the  framing, background color, whatever it is. And then this is where you get into the weeds with a  lot of customization.

You upload all the photos here. Your pet name if you want or don't want it.  You can add a halo to your pet. We have a printed font. We have a script font. You get to choose  from those. You can also go with no font notes for your artist if you have anything specific. And  then that you have to upload files to be able to do it. But the very last step is going to be those  final customizations you can make to the portrait and everything.

So building out this whole flow  was something that really changed everything for we saw our AOV rise 20% with being able to What is  her AOV? Right now it's $90 or yeah for the online store and for Etsy excuse much lower because we  sell a lot of digital products there it's $65 limit. Okay. So Etsy and Etsy is significantly  lower just because the bulk of customers are buying a digital file, not framed portraits where  the majority of our sales are in direct site or framed portraits.

And you know, even this two pet  portrait is $105 because it's our all the shipping of the portrait is we offer free shipping and  that's a cost we take on ourselves, but shipping is pretty expensive for all these portraits  to make sure they get to their destination, all in good shape. And then obviously the labor  with all the artists, the artwork has to be done and then the product.

So did you have any specific  questions or So I think right now I've proven now that there's a demand for the product which is  nice and helps me sleep a little easier at night. as far as driving traffic, finding a consistent  because like you said, like in month one, that's you can't rely on that thousand from friends  and family just like I can't rely on holiday season every year.

You know, I need to find some  consistent way to drive traffic. I've yet to find what that is. So, I don't know if I just haven't  given ads enough time. I have never really tried influencer marketing to the degree that I know  I need to be able to attack it to be able to see that difference. And then honestly, I'm not very  good anymore at making content on my own about my business and raising awareness because I don't  like feeling like I'm pedaling product to people that follow me.

It's just it's weird for me. I  don't like selling to people. So, any any ideas, anything? Yeah, I would. So, look up Custom  Captain. That's my buddy's company. He does over $10 million a year with this business. And if you  just look, that's what he started with is simple boat and car artwork. And wait, no way. It's very  even has the line drawings.

Very similar to what you're doing, but he gets all of his business  from Facebook ads. Really? Yeah. And with my e-commerce business, Texas snacks, we have relied  on Google ads since day one. and we kind of foray into Facebook ads every six 12 months and it just  wasn't quite profitable enough and we just kind of abandoned it until a few months ago we cracked  the code.

We were profitable on Facebook ads like four years ago and I think we were spending  $7 to acquire a $50 customer which was great. So we don't have great margins so we need to be  like below 10. Okay. Right. But then it just it got less and less profitable. We try every six or  months and didn't see much. But I I've got a new ads guy now and he just kept like pestering us for  more creative, more creative, more creative.

And that's the name of the game. Like the harder way  is the better way. And it's not harder as in you got to spend more money. You got to It's like you  need more creative. You need to test more things. And have you ever used Hey Gen? No. So Hey Genen,  like is it like it's an AI avatar? Yeah. It could like you could test a 100 different UGC ads, user  generated content ads with AI avatars and it looks almost real, but you don't have to pay anyone or  you don't have to go back and forth in I've been hit with their ads

so many times on Instagram and  like the stuff they create. Yeah. Okay. It's good. But we don't even do that like with we don't use  any AI in our Texas snacks ads and our rorowaz our return on ad spend today is 10x at scale.  We're spending like 500 a day on Facebook ads and we're a 10x r rowass and it's just because we  just feed it more creative.

We keep the creative fresh and it's hard. It's not super expensive  but it's just hard and timeconuming. We have someone there like look at this new product. Oh,  they have this new St. Patrick's Day shirt. How are you gathering a lot of the UGC or new from our  release? No, there's no UGC. There's our employees are just filming content like in the store or in  the warehouse with the products really and just talking about it in different ways and we'll we'll  try a 10-second video and a 10-minute video and we just try

everything and then we just put all the  ad spend behind the ads that work and then after a week or two, you know, the performance dips and  then we test new creative and like that's what we're going to have to do forever. But that's  okay because like we're doubling our sales. That's awesome. And our sales have been growing  at, you know, but now they're like doing this.

That's so all from Facebook ad. So I guess my my  followup question with the strategy of actually running the ads from what I've gathered thus  far with the research I've done. Meta pretty much takes on their own as as far as targeting  audiences because I remember when I initially started it was like targeting down to interest  and age and don't do any of that.

You just say audience advanced insights. You just worry about  creative and they'll find the people. Are you guys pretty much using just CBO ad group? That's okay.  Well, yeah. Then how much time have you spent in the meta ads library looking at competitive  recently? Yeah, little to none recently. Um, two years ago I was spending hours a day going  through the meta ad library for we have a really big competitor called Willow and they do a they're  pretty much an exact same product is and they crush it.

I mean I would just copy them. I would  pull your audience and I would pull them and say, "Hey, like if you could buy this product for $90  and it was drawn by a human or this same product uh that looks you could even send pictures of  each. This was drawn by a human and it's $90. This was made with an AI model and it's $65. Which  would you prefer?

Cuz because sometimes we assume like they want it to be drawn by a human. Like  that's what they don't always want that. They just want cheaper. And if all of your competitors are  doing using AI models and just printing money and it's like do we want to be like dogmatic about our  mission or do we want to be profitable? Because there are and and that's one of the reasons that  Etsy has become so much more competitive is that there's people now that will offer digital files  for 10 bucks a file and they're just using

AI. Yeah. To to be able to do all of it. So they  cut out any of the overhead. It's pretty much 100% profit outside of whatever their labor  is for generating the image itself. And I've been really back and forth on how much does that  differentiator actually help us and is it worth the money we're leaving on the table because I  I can use open to generate all like not it's not tough anymore.

Maybe a year ago it would have  been difficult. Now it would not be at all. And then we'll have people that accuse like we'll have  customers if they get the artwork back and it's not their style. This looks like it was just AI  or something. I'm like, I wish it was cuz we want to save money. Yeah. Yeah. But it's actually not.  Have you played with Nano Banana at all?

Have you heard of that? No idea what that is. You got to  play with Nano Banana. It's a Google product. It's Google image generation. They're number one in the  image. So Riley was just telling me about that an hour before you walked it. Yeah, that's awesome.  Okay, that because I've been using OpenC or just Chad. Yeah. For pretty much all of our images.

And  so I posted a video about how people should start like a a lead generation business for home service  businesses where you just take like pictures of homes from the Zillow API or Redfin or Google  Maps and then you run it through Nano Banana and just say like make beautiful landscaping native  to North Texas landscaping, right? And then you send that lead to the person that's like, "Hey, we  could make your yard look like this."

And you just automate and it doesn't look like an animation  or a drawing. It looks like a picture of their exact house with perfect landscaping. And then  you get leads and you sell them to landscapers. So you don't have to start a landscaping business,  but there are other there are real estate agents doing this. And I posted that video and I've  had people reach out saying, "Hey, I started that business.

It's working." I posted another  video about, "Hey, take Nano Banana and go to real estate listings that don't have nice pictures  or at least that don't have pictures of homes that are staged first. Yeah, they're not yet." And then  send them all the you send the listing agent the staged pictures. Yeah. And say, "Hey, did you  know that homes on average sell for 7% more or, you know, for 23 days?

They're on market for 23  days instead of 42 days if they're staged." Well, why didn't you have it staged? Because it  cost $4,000 and it's annoying. You know, furniture is heavy. So, here you can pay me dollar  for photo per photo. Just upload your photos into my web app and you'll spit out a staged version  of it. And what do you have to lose? It's 20 bucks and you could sell your home for 20 grand more.

So my point is like Nano Banana is that good that when you see that image it puts out it looks Do  they video animation as well or is it just I think they do. Yeah. I would think very seriously about  live selling and everything I'm about to tell you I learned from this guy behind the camera Braden.  He is a live selling master on t like whatnot and Tik Tok live.

I'm I am really into Pokemon cards.  Yeah, I own I spend way too much money right on Coco and I have like all the vintage cards and  everything and so I get ads for whatnot all the time. Yeah. So it's whatnot and what else and  and Tik Tok live. Tik Tok live just launched auctions and it's very early and so basically the  the first movers to any given category on Tik Tok are getting pushed like crazy to the algorithm.

So Braden, my friend slash that guy right there holding the camera breaking the fourth wall here.  He sells food. He sells protein bars on whatnot. What protein and tick built bars, whatnot, and Tik  Tok live. And tonight we're doing a live show. Uh we're gonna make a video about it. And he's buying  these bars for 75 cents and selling them for like at or above retail.

That's right. Uh and he sells  them for the most on Tik Tok because it's so new and people are just excited. They want to bid.  Like they might even know it's above retail, but they just get caught up. What you could do is  you could just have some physical prints and you could sell one of two things. You could just  do digital stuff. Digital only five bucks 10.

It doesn't matter. Use AI to generate all of  them. You don't need any of your team in the Philippines. Or you could do physical ones. You  like you could do drawings different styles. You could just pull up like 20 different styles like  yeah golden doodle Frenchie. Like just get like the most common breeds because that's going to  be the broadest for people that are watching.

and do an auction like for a 8 by12 or whatever  for the drawing style French. Oh, seven bucks 850 850 and like you will make money but the point is  to is to bring people to your website where yeah okay there we go that's I have my marching orders  get a ton of UGC need to look into everything with AI and need to start some Tik Tok lives  because that's fun but like I like doing stuff mean a lot if you want to go the extra mile.

Share  this episode with a friend that might have an interest in starting a business. It would mean  a ton. Hope you have the best day of your life