The Dos and Don'ts of Pitching Your Business on Shark Tank

The Dos and Don'ts of Pitching Your Business on Shark Tank

Getting onto ABC's Shark Tank—a reality show featuring budding entrepreneurs—isn't just an opportunity to pitch to a panel of well-known investors, but the chance to earn valuable connections, exposure, and an impressive milestone in your company's story.

On this episode of Shopify Masters, you’ll learn from a husband and wife entrepreneur team about how they prepared to pitch to Shark Tank investors.

Hanna Lim and Mark Lim are the founders of Lollaland: makers of modern infant/toddler goods that are both functional and fun.

When you’re going in to pitch someone, you’re not going to beg for money. It’s a fair exchange.

Tune in to learn

  • How to perform market research at a trade show.
  • How to identify which advice you should take and which you should ignore.
  • Why you shouldn’t pretend to be bigger than you are.

Listen to Shopify Masters below…

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Show Notes


Transcript

Felix: Today I’m joined by Hanna and Mark Lim from Lollaland. Lollaland makes modern infant and toddler goods that are functional and fun and was started in 2010 and based out of Monrovia, California. Welcome, Hanna and Mark.

Mark: Hi, Felix. Thanks for having us.

Hanna: Hi, Felix.

Felix: Hey, so yeah, tell us a bit more about the idea behind the business. How did you guys come up with this company essentially?

Hanna: I had just had a baby and I was a stay at home mom at the time. I quit my teaching job and Mark was working full time and also attending business school at night and I just … It was really out of necessity. My daughter was one of those kids that just hit every milestone really late and the sippy cup, transitioning her to a sippy cup was a real challenge for me. And I thought, “Why isn’t there a cup that is just easy for kids to use, easy for moms to clean, sort of eliminates challenges for kids and is looking cute at the same time?” So I told my husband about the idea and he said, “Listen, flesh it out. You’re at home. Think about the design and the business of it and whether it would sell and by the time I graduate from business school, if we still think it’s a viable idea, we’ll just both dive right in and go for it.”

Felix: How much time, you kind of just talked about this very quickly, it sounds like it’s much longer than the way you describe. How long did it take between coming up with the idea and kind of like fleshing it all out into essentially what sounds like a business plan?

Hanna: I’d say from the day we had the idea to the day we sold our first Lolla cup was probably almost two years.

Felix: Got it. Now what was happening during this time? When people are out there listening and thinking about starting a business, they have an idea, what steps did you know you needed to take to get a good understanding of whether it will be a good business idea or not?

Hanna: I think, in hindsight we probably should have done more homework, but it was really understanding that you have a product that’s different from what’s out there and knowing exactly what that difference is and I guess you can never really know if there’s a market for it, but just making sure that there’s something unique about what you’re selling. Because it’s all about the story and the product [crosstalk 00:03:14]

Mark: I mean, we did a good amount of homework. We went to the biggest baby trade show in Las Vegas and we pretended to be buyers and maybe not the most ethical step, but we found a friend who had a store and we said, “Hey can we just like go as part of your team?” And we walked around and got to see what the landscape looked like. We talked to buyers. We asked, “Hey, this is the concept we’re coming up with, is this something that you would consider?” Which, at the end of the day you get a lot of, “Oh yes,” and then a lot of nods and like, “That’s a good idea,” because they don’t want to hurt your feelings. But we weren’t afraid to ask around.

I do think that we could have asked a lot more business owners for advice and now that we know people are just so willing to share information as well as we are, I think at the time we just felt bad. Oh, we may end up being competition, so of course no one wants to talk to us. But that’s not true. There’s a lot of people that are very happy to kind of give some information and knowledge.

During that time, Hanna, again I was at work and full time business school student and then Hanna had her hands full with the baby and all and trying to flesh out this plan, but she wrote a really good business plan and it really helped us kind of frame everything on where we stand and who exactly was our target market and it also helped to secure a small business loan. So all of that kind of took about 12 to 18 months.

Felix: I like that you both went to a trade show. You went somewhere in person to do this research and a lot of the times when people are sitting down and trying to run through these ideas and trying to validate which one they should pursue, the immediate kind of reaction is to go online and do some research that way, but you saw to go to a trade show and do that. What kind of benefits do you find, or did you find, going to a trade show that you don’t think would be available if you were just doing your research I guess remotely, like online or reading publications?

Mark: There’s so many. It’s hard to tell … I mean again, a lot of the trade show is façade, but you see a company and you go to the trade show and like, “Oh this little, cute little whatever product, okay that’s great,” and then all of a sudden you see that they have a 30 by 30 island booth with this great structure and you’re like, “Whoa. They’re a lot bigger than we had ever imagined,” And vice-versa. We see companies that we’re like, “Oh my gosh, this company must be doing like $50 million in revenue,” and then you go and it’s just a team of two and you’re like, “Oh, maybe not,” and of course looks can be deceiving, but it gives you some kind of gauge of where people stand and how things are. So, I’m glad we went to trade shows. I wish we went to more and talked more.

Felix: So kind of pulls back the curtains a bit by going to these trade shows.

Mark: Absolutely.

Hanna: Right. And I think going in person, the whole point of trade shows is they preview products that are coming up in the future. So for us to kind of get that preview of what are we going to be really competing with in the next six months to a year. That was invaluable. I think another thing is, you just get a general pulse of, I mean if you are at a trade show and there’s no foot traffic and no one’s there, I think that it might be a little off-putting or you start to wonder and ask yourself, “Is this industry even thriving?”

Felix: So what did the both of you learn coming out of this? Do you remember some things that you learned that actually had impact on how you wanted to create the products, or how you wanted to market or design the company?

Mark: Oh absolutely. I mean, I would say … Well first of all, one of our competitive advantages was being made in the USA, because we didn’t see a lot of plastic feeding items that were made in USA, but no real way to confirm that. Obviously at the time, 2010, it wasn’t as Amazon-heavy and as crazy online presence. There was still plenty of companies that barely had a functioning website ,if you can believe it or not. So, yeah to see if our things that we thought were our competitive advantage, to see them live and see if they were there.

I mean, I don’t want to give us too much credit, but we were one of the first as far as gear goes that packaged it kind of like a premium item. Kind of like a gift. A lot of time gear, cups, pacifiers and whatnot, they’re very sterile and very almost like you bought them at a hospital gift shop or something like that. So we went the other way and said, “No, this is like an experience. This is a gift,” and people are wanting to buy into this feeling of, “Okay this is a high quality item and it’s a very boutiquey.” And so, we really, really pushed the envelope on design and then when we came out, shortly after, you saw a lot more companies kind of do similar things. I’m not claiming that we’re a pioneer, but it wasn’t as prevalent when we first came out.

Felix: Yeah, certainly competitive advantage like you were talking about and Hanna I think you were mentioning how when you are able to identify what is unique about the particular products that you want to release. Now, when you know these things, like you know what’s different about your company, what’s different about your products, how do you piece it all together in terms of whether customers will care or not? How do you know what actually differentiators, what uniqueness, what features the end customer is going to care about?

Hanna: You know for us it was honestly, when we were first starting out it was really going on sort of that gut instinct and intuition. Sort of what I as a consumer was looking for, is what I designed the product around. However, I think it’s really, this is where doing the footwork or legwork really comes into play. Because once I had my first prototype that was packaged, I really, I just put them in my trunk and I started driving out to the hottest stores in Los Angeles. I remember walking into Fred Segal and asking to meet the buyer and I showed it to the sales associates and I said what do you think? Can I leave it on your counter and see if anyone responds to it? Just really getting it out there and putting your product out there and just gauging peoples’ honest responses.

Felix: What did you learn from that? What did you, when you were going out to meet those buyers and you were leaving your products for foot traffic to see, what did you learn about again the products or the way that you wanted to build the business?

Hanna: I think what I learned was that how important, at least in our space, in our category, how important the packaging was for us. So we sort of took a chance with packaging. We had heard from sort of big box buyers, “Oh no, you need to have a box that hangs perfectly on a wall with a plastic window,” and we sort of pushed the envelope on that. We took inspiration from a brown paper bag, lunch bag shape and we made a play on that and only had a tiny little window where the face of our cup peeked through and we really thought, this is a practical item. Yes, it’s a sippy cup, but why can’t it be a fun gift or that type of thing.

So once I put it on the counters at retail stores, I think that really, it caught peoples attention and I think colors, a lot of what we chose as our company colors were really important, because in the baby space it’s a lot of sort of pastel blues and pinks and ivories and we just went really bold with bright yellow and red and so I really learned that people were responding to that. It wasn’t that you had to go with what everybody else was doing.

Felix: Yeah, I mean certainly if you wanted to blend in, you should go with what everyone else is doing. But it sounds like you wanted to make a pop and make people recognize, “Oh, there’s something different here. Let me take a closer look at it.” Now, I like that approach of putting the products on these counters, going to these stores and seeing if you can do that. Did you have a pretty good, I guess, success rate with stores allowing you to just leave your product with them?

Hanna: Absolutely. I mean in the beginning, again the buyers are usually in an office upstairs and it’s the sales associates on the floor and I just said, “You know, listen, can I leave this on the counter? If it sells, great. Please tell your buyer.” And I’d say of the ones that allowed me to leave a sample, I had a very high success rate. But that’s not to say that every time I walked into a store … It was tough. I got the door shut on me many, many times. But of the ones that did allow me to leave the package, probably 75% gave me a call back.

Felix: Oh wow.

Mark: I have to add that it’s definitely a long game. A lot of the things that Hanna had reached out earlier, it wasn’t right away. Some of them took several years, actually. She went on a trip to New York for seven days and our plan was just go to every, every Manhattan boutique and Brooklyn and just knock on the door and just go in there. She came home with nothing. Like not a single purchase order or anything. But eventually every door she went down, within three years, eventually bought our product and it was, “Oh I remember you guys. You guys stopped by. Oh yeah, I see you at the show.” And then the next year, “Oh, you’re still here. Oh, okay.” And then the third year, “Okay great, I’m ready to work with you.”

Felix: I’ve heard this same scenario play out from other brands, other stores too where they kind of want to see, can you last, can you stick around long enough. And if they hit you, if you hit them on multiple touch points, at trade shows, in publications, they see you in person, all of that kind of helps them almost get reassured that this is a legit company, they’re going to last. They have products that are in demand, otherwise why would they be around? And then they invest in you. THey’re willing to kind of take that as obviously a less risky, once they’ve seen you around for a while. So, I do agree that it’s definitely a long game.

Now I want to take kind of a step back and back to developing this actual product. So once you understood that there was a market, there’s an opportunity, there’s a market opening for you guys to come in, what was that product development process like? How did you go about creating the actual product that you will be leaving at retailers?

Hanna: You know, I always tell people that I actually did legitimately start this business on Google because I had no idea. I remember my first Google search being how to manufacture plastics. I mean, it was so rudimentary, I had no idea what the lingo was and, you know, as any search does, it sort of leads you down a rabbit hole and I figured out “Oh, it’s called injection molding and oh, in order to do that you need a CADD file. And who’s supposed to make this CADD file?”

So it really was a very organic process for me and what I ended up doing, was just reaching out to people locally because it was people I could access easily, I could meet them face to face, sort of learn the ropes. So, my first step was I actually just found a bunch of plastics manufacturers in Southern California and yes, they were not close, but every day I would drive out to one and just knock on the door and say, “Hey, do you ever work with small businesses or startups?” And I just took every bit of information I could learn from anyone and that’s how it all pieced together. And from there I realized I need to hire an industrial design firm or an industrial designer to help me with the actual design of the cup. I am in no way an artist or an engineer, so then I started reaching out to those people and that’s how it all happened.

Felix: Now this sounds like it could become a very expensive project early on, before you have any sales, before you have any purchase orders, anything like that. It sounds like a lot of investment early on. Was that when you turned to the small business loan, or did you have that already? When did you decide that, “We need some capital to get this thing going?”

Mark: So we invested $100,000 of our own money and we were able to secure another $100,000 as a small business loan. It’s borderline crazy what we did, to be honest, the mold itself was close to 140, 150 grand. Because it’s a US made mold. We didn’t know any better. I mean, the thing is I’m not sure how much we would have done it differently, but we did not have any connections in China. We weren’t willing to take the risk of it not really working out and come to find out that it’s not that huge of a price difference if you’re exporting a mold, meaning a lot of Chinese factories like to amortize their mold costs, so they’ll entice you to use them as a factory. So if the mold might cost them $60 grand, they’ll charge you 20, but they’ll roll the price into the part, so that you pay it back. Whereas if you know that you’re going export that mold and you’re not going to produce with their factory, they’ll probably have a pretty big premium.

So given all of that, at the time we said, “Okay, we went to the trade show, we did our homework, we wrote our business plan, we talked to buyers, we talked to customers. At some point you’re going to have to take a leap of faith.” That leap was pretty big for us. Kind of crazy to be honest, but we did it and luckily we were able to kind of pay it all off and it kind of worked out in the end. I’m not sure how quickly I would have been able to do that now, but that’s just because I know more.

Felix: Yeah. You know it’s funny, you hear from entrepreneurs all the time about how if they were any less naïve they might have never gotten started, right? You kind of have to only know enough to get going, but not too much that it scares you from going with it. Now so you got the injection mold, you got all of this ready to go. This was I’m assuming done prior to leaving the products at the retailers, or did you have early prototypes? Was the finished product already ready to go when you were leaving these products at the retailers?

Mark: Yeah, they were finished. This is not, we weren’t … To get a 3-D model back then was like a grand. So it’s not like now where you can just like, you can go to Staples and get a 3-D model of something for $25. It just was not like that. To get even a really junky looking SLA model that wasn’t painted was kind of quite expensive, especially for a young start up. So, when we decided on the … We showed mock-ups, we showed pictures, but after we decided we’re going to go through with it, we just went for it. Yeah, I think we would have been a lot more into the 3-D models now, but it is what it is and that’s why. We just took a leap of faith.

Hanna: Yeah, but you know, I think another thing is, leaving a 3-D model or a prototype with a buyer or a customer is a dangerous thing in my opinion, because again, I think it tends to make people wonder if you’re ever going to deliver. Like is this ever actually going to become a real thing? So, I don’t know. I’m not sure what the right answer …

Mark: Well, yeah there’s also an advantage to say, “When are these ready?” “Now. They’re in my garage, now. And I can ship you tomorrow.” There’s this kind of I’m willing to put my money where my mouth is aspect to it. And so that really, that kind of really helped. Also, our flexibility, we knew some of our competitors, they’re a little bit larger, they have 3 PL’s, they have all this infrastructure. We didn’t. So if you want to order one red and seven green and three pinks? No problem. We’ll make it happen. We’ll package it nicely for you. Whereas other brands, they kind of have a system where a case packs, you have set minimums … No, we don’t have any minimums. In the beginning, just get it on your shelf and prove it and validate it. And sometimes that kind of … You know, it doesn’t sound like a competitive advantage to someone, but it really is. That flexibility. The willing to say I’ll ship you within an hour as long as UPS is still open. So we used that to our advantage, because we were a little bit more nimble and mobile than our competitors.

Felix: Makes sense. Now when you were leaving the products with the buyers or these on the counters, I guess the ultimate feedback is for them to call you back and want to order more. What else can they provide you? What other kind of feedback were you getting from these retailers after placing your product with them?

Hanna: You know, I think it’s funny you mention that because the feedback … You always have to take with a grain of salt, because we would get feed back, “Oh, this is great. I love the sippy cup, it’s selling really well. Do you think you can add now a bowl?” Well first of all, every buyer I think or customer has a suggestion for you and you really have to be I think very deliberate about what your next launches are and say, listen … Or be very forthright and say, I mean for years we only sold the Lolla cup and we said we don’t have plans to make new items yet. So you know, that’s that.

Felix: How do you say no though? How do you get … What is like a lesson that you learned that you were saying yes too often and you were catering or customizing too much for customers? Or did you know to say no right off the bat?

Mark: Yeah, it takes discipline to say no. Before I did this, I had a small t-shirt venture and I made the mistake of listening to every buyer and they said, “Hey Mark, if you added these men’s polo’s to your t-shirt line, you would rock it. Like trust me, I’ll buy it, I’ll buy it.” And this wasn’t just one buyer, this was several buyers. And so we sunk in $75,000 in this whole polo program. It didn’t sell. We sold like 2% and I was like, “What happened to you were going to order this?” “Well, we changed our minds.” It’s just so easy to say, but you really have to fit it in so … It was a huge lesson learned for me. You have to say no sometimes, or you have to say, “No, this is what we have. This is what we’re offering. You’re either a partner or you’re not.”

Felix: Right. Now how do you know which advice then to take when you’re … You know people always say, the most valuable feedback comes from your customers, because of course they’re paying for these products at the end of the day. But how do you get good at recognizing what kind of advice you should listen to and which ones, like you’re saying, take with a grain of salt?

Mark: Right. For me, it’s definitely has to be a direct 100% hit as far as you are our target market. Because sometimes a mom or parent will say something, but when you really kind of break it down, they’re not exactly our target. They have great ideas, but it’s not really exactly who we’re chasing. So you kind of have to distinguish that. If it’s a parent that you know would live with our brand and be a part of our brand for a long, long time and she’s one that we’re chasing, then it weighs a little bit more. And that goes for our wholesalers too. So if the wholesaler has a store that carries a lot of our target market, then we kind of weigh that a lot more.

Hanna: Yeah and I think it’s a combination of understanding what makes sense. I guess it helps more I guess at retail than anything, but when you start to expand your product line, look you have this, built this distribution. You put in a lot of work to get these people to buy this sippy cup that’s giftable. Now what could you put side-by-side with that and what would make sense? Like what customer, what would they want to add on to this? And that happens in the online space too. We have a very small product offering, but when people come to our website, because they have heard of the Lolla cup or something, they tend to poke around and say, “Oh, you know what? These dishes or these plates, they match the cup and now I want this too.” And just, really grabbing that customer and maintaining their attention in that space that makes sense.

Felix: Makes sense. Okay, now once you’ve had this success, this early success with these retailers, what was next? How did you decide, what was the next big step? What was the next way to scale up the business?

Mark: We’re still figuring that out. [crosstalk 00:24:09]

Hanna: … timeline.

Mark: A lot of lessons learned here are our initial … And I’m not sure we would have done it differently, but our initial kind of goal was to really be in to these Brick and Mortar independent specialty boutique business. We weren’t thinking Target or Walmart or anything really mass branded. We wanted to live in the space where things we’re a little bit more premium, a little bit more kind of [inaudible 00:24:33], but as you know, the landscape has changed really fast and it’s funny. The questions that we got in the first two, three years of our business is, “Do you also sell on Amazon?”, and sometimes people would say, “Oh, no no no.” or “We’re not sure yet. We’re still trying to figure it out.” Now it’s an absolute given. I think that that direction is where scale can really happen for us, to really be a little bit more strategic with our Amazon sale and not just, “Oh, here it is. It’s just available to buy.” But in also our direct-to-consumer portion of our business ’cause let’s face it that’s where our customers are going.

But our kind of buyer relationships are extremely important to us and they’ve been there from the beginning and we really, really do still value them. I’m not sure if this is like a statistical thing but I think our challenge to scale has been that, because our focus was so heavy on a Brick and Mortar business that is kind of on its way … On a downturn, how’s that? I think that’s been kind of … I think we should’ve kind of really seen the signs a little earlier and acted more deliberately upon that but you know, we’re learning. We’re trying to …

Felix: Right.

Hanna: Yeah.

Felix: Most of businesses has been built on just hustling and getting into the retail stores. When did you guys decide to put more emphasis on the direct-to-consumer, I guess the online store itself?

Hanna: You know it probably wasn’t until about our three or four year mark that we really started to focus on becoming more multi-channel, I guess. We were launching in a premium space and so, what we were really looking for was press, validation like being in those top stores. Like when we landed Barneys New York and started seeing our cups in celebrities’ hands, we’re like, “Wow.”, we have that social proof now and we really leverage that to expand into the online space as well. But you know, it’s funny, I think what’s been a challenge for us is that it changes so fast, like I remember the first time we designed our website, we thought, “Wow. It looks beautiful.” And then, not just like two years later, people were saying, “But your website’s not responsive now.” And we thought, “What does that mean?” I mean, that wasn’t even in our wheel house at that time and Shopify has made it super easy. Before, we had really just gone from scratch. We weren’t even using a platform like Shopify and just making those moves, calculated moves, has been huge for us.

Felix: You mentioned that the focus early on, because it was a premium product, was on validation and social proof. How did you come to the realization that that was going to be, I guess almost a pre-requisite if you wanted to compete in that space?

Hanna: I think social proof has … I mean, the terminology has changed from then, now till then, but back then we used … There’s a little teether called Sophie the Giraffe that was hugely popular when my first child was born in 2007. It was one of like “it toys” that Tom Cruise and his daughter was holding and we thought … And that sort of we modeled our sippy cup after. It’s a necessity but it’s almost an affordable luxury that, you know, for $20, you too could be holding what the celebrities are holding, so that was … I mean, we just, at the time, I think when we we’re launching, Us Weekly had, I don’t know, six pages of celebrities’ kids and what they were wearing and what they were holding and so that was just sort of, it happened naturally. Like we felt like we really wanted to carve out a space for ourselves, like that’s where we had to be. Now that’s translated to, you know, just having a mom post on Instagram, that’s social proof. It doesn’t have to be a celebrity anymore.

Felix: Now when you’re getting the celebrity proof against social proof that way, were you active in getting that or these celebrities just discovering your products organically?

Mark: It’s a little bit of both. We did have a public, small boutique public relations company help us get it into the hand of editors and gift guides, like people gift guides in Daily Candy, although Daily Candy is no longer but in all those kind of little things. But I think most of our celebrity kind of following was kind of natural, ‘cause it was at Barneys New York, Fred Segel and Nordstrom. Those are the places where they buy ,so it did come pretty naturally but I’m not gonna say that we didn’t try to send some of our products to the celebrities’ agents or not.

Felix: Now you’re saying that the focus for you guys today is more on I guess the local celebrity, people that are have following online but you might not see them in the magazine. What’s changed in your approach to get access to those influencers?

Hanna: I think now what I think about and just observe, we have a lot of friends and family members who are having babies and it just seems like word of mouth is gold these days. You can’t underestimate the power of word of mouth and that’s what changed, because whereas five, six years ago, people were really trying to do what celebrities are doing. Now it’s just about the conversation you’re having or what the mom next door is obsessed with and I think that’s what caused the shift.

Felix: What do you think then is required? Maybe, I don’t want to use the word formula, but what’s the ingredients that you need to have in order to generate this positive word of mouth for your products and your brand? It’s one of those things that you can’t really you push, but it sounds like you need to have things in place in order for people to want to talk about your products.

Hanna: Right. I think … You know, and again this is a little hypocritical ’cause I don’t think we do enough of it, but you can’t underestimate the power of just asking. I mean, asking people to share in … Even incentivizing them. I know now in our post-purchase emails, we include user photos of like how our products look in the home and in the baby’s hand and like this is what’s being shown on Instagram. I don’t know, it does entice people to share, just to see that others are doing it. So I guess modeling as well.

Felix: That makes sense, that if they are seeing the others are sharing the photos because you’re sending them photos that people have shared, they might be encouraged and might think, “Oh, I can share this too.” Because … Especially if you have a product that is premium or like you’re calling affordable luxury. People like to showcase that, “Hey, I can have these nice things too.” So I think having a product like yours also almost required that there has to be something that people want to share. Has to be a product that is interesting enough for people to want to share, that looks cool, that looks cute and they want to share. So I think that’s also pre-requisites that you have a product like that.

Hanna: Yeah, exactly and I think if you even look on our website now and on each of our product pages, we do have sort of a live curated Instagram feed. Just even during the shopping experience, really bombarding them with like, “Look, people are using this stuff.”, and join the group.

Mark: Also, I want to add to this ’cause Hanna does all of our social media stuff and we get solicited a lot. There’s obviously partners that we want to kind of see if we can figure something out together, but we also get solicited on, and one thing that I think we do, to her credit, is kind of not pick and chose our partners, and it has to be really aligned with our branding and our kind of vision. And so, while some of these companies or bloggers or Facebook influencers are great and have a massive following, it doesn’t quite match exactly what we’re going for, and even though we might get some pick up, we politely decline. It’s kind of, I don’t want to use the word sell out, because I think that’s a negative approach to something that’s have been great to some certain companies. But because we stay true to our branding, when we do make approach to someone and say, “He, can you work with us.” And obviously they look through our timeline to see, “Okay, what’s this company about?” They see that we don’t just chase anyone and everyone that’s willing to kind of spread the word.

I don’t know if that’s a total business sound move, but you know, an influencer gives away Huggies diapers and Avent bottles every other week. Well, while that’s great and she appeals to millions and millions of moms, that’s not our mom. And so we don’t feature her on our timeline, and it’s not because they’re bad or their business is bad. It’s just, it just doesn’t really match with us. So it’s kind of that discipline to kind of stay true to who you are, that helps you curate more relationships, in my opinion.

Felix: Yeah, I think you hit it on the head though, that you might not see those bumps that you would get from working with anybody, but it sounds like a much better long term brand building approach, to be selective in who you’re working with, what you’re showing, because even if you aren’t bringing in these customers that you would have access to by working with larger influencers, you’re also not diluting your brand and your messaging with your kind of core group of the moms that you’re going after. So I think that there is definitely a smart business decision, especially for a long term, like brand building in play, that’s obviously working well for you guys.

Now I want to talk a little bit about the, your experience on Shark Tank of course. So, I seem to remember seeing you guys on Shark Tank, even before we ever started talking about bringing you on to this show, and I though it was a very interesting product as well. Now talk to us about that experience. Kind of give the background a bit. You guys came in to the show looking for I believe $100,000 for 15% equity in the company. Talk to us about what happened. What was the end result of being on the show?

Mark: So yeah, wow. It’s so many years ago. But we were huge fans of the show early on, when only a couple million people were watching it at the time, and we kept saying in our heads, “You know, I think we would do great here.” And it happened to be casting right here in Los Angeles, so we went through the whole journey. We ended up giving 40% of our company, for $100,000. Now, kind of keep in mind that we had only been in business for three months. We’d only been shipping for three months at the time. And I think, we did ask, “Is there any way we can come next season, because we’d like to kind of have more traction and validation of our company, so that would help us with our evaluation.” They said, “No, you are on of 30,000 being selected to come through. It is now or never.”

And so, we felt we did get a little pressure, but that’s okay. At the end of the day, when Hanna and I decided to take this deal, we said, “Look, no matter what, we’re leaving with a deal.” And so, did we give up a little bit more than we had initially planned? Yes. We still maintain control and we have great relationships with [inaudible 00:36:22]. Our Rolodex is now chuck full of great, great contacts. And so, if and should … If this thing doesn’t work out, for whatever reason, we know where, we have a good foundation to maybe try again, or do something else. And so that was kind of really the main reason why we went through how we went through.

Felix: So you were coming on to the show, you were saying that, “We need to get a deal, no matter what, because it opens up all these opportunities,” and it wasn’t so much about the cash investment that you go to get, right away.

Mark: Yeah, ’cause there’s Shark Tank evaluation and then there’s real evaluation. I think we could have got a lot more capital, for a lot less equity, with a few other partners who were kind of interested in investing in our company. But what we wouldn’t get is that insane amount of press and coverage, the just complete validation in the public eye. We wouldn’t have a partner who has relationship globally, all over the world with just a phone call. So that’s kind of what we were looking for, someone that can really, really swing a big bat, if push came to shove.

Felix: Yeah, that’s a good point. It’s not just about how much cash they’re willing to invest, but you can’t put a dollar value on the relationships that you’re able to build from being on the show, just from the kind of press that you’re getting and the press that comes after a show like that. And of course, the connections with these investors. Now you mentioned, of course Mark and Robert. Do you remember, I guess in your opinion, what is some of the best general business advice that they’ve given you, that’s helped your business?

Hanna: One thing that I think Mark Cuban gave me really early on, was because I was handling the social media, and again, three months in it was really, we came on the scene and we were trying to appear to be this big corporation. There was no sign of Mark and Hanna, aside from doing the sale, door to door sales. And after the show and after working with him, he was like, “That’s not what it’s about. A lot of people want to resonate with the company owners and know your story and don’t be so … Don’t put up this front that you’re trying to be this big company, ’cause you’re not.” And that was really invaluable to us, because once he told us that, and we tried it, it really helped us connect with our customers, listen to what they were saying and just … I don’t know.

Felix: Yeah, I mean you mentioned in I think the pre interview notes or questions, about how you guys try to keep your marketing as organic and personal as possible, and the try to tell your story in an organic and personal way. Can you say more about this? What are some examples of things that you’ve done to try to really get intimate with your audience?

Hanna: One thing is, I think I struggle with Instagram in particular. You’re constantly trying to put content out there, and I try to balance it out with sort of the staged, professional photography and your every day. And I think what’s unique about our industry is, a lot of parents, they want to chuckle, and see a photo and chuckle about the reality of parenthood and all its mishaps. And so I think, one example of the way I keep it organic, is just that. Some days, I have this beautiful photo of our product in an Easter basket, and then the next day, it’s the total mess in my dishwasher, of all our products. Just keeping it light and whimsical and really showing what your every day is like.

Mark: I think also Felix, it’s kind of a hard thing to overcome for some entrepreneurs, but just being vulnerable. From the very beginning, our willingness to be vulnerable, to say, “Hey, you know what? We messed up your order. We’re really sorry. We’ll make it up.” They know we’re small, we know we’re small. We’ll admit that we can fix this and we do, wholeheartedly. And there’s an extreme amount of forgiveness for that. Sometimes, when you appear too big and too good and too strong, and then you mess up, it’s kind of like, “Dude, what’s your deal? Get it together.” But to just kind of stand up and say, “Look, we’re trying. We’re trying to improve, we’re trying to get better, but we’re not this massive corporation.” People connect with that.

Felix: Yeah, that makes a lot of sense. And if you try to become much bigger and be a large corporation, become essentially less human, right? People don’t see you as an individual, or see you two as individuals anymore, and they are less likely to kind of hold punches in and don’t give you that kind of slack that they would normally give if it was a real person, that they were talking face to face with.

Mark: Yeah.

Felix: Now you, like you’re saying, you guys were very new in the company when you went on Shark Tank. How did you, I guess, prepare to go on a show like that? What were you guys doing, to make sure that you would have a successful appearance on the show?

Mark: So one thing that we did was we watched every episode, we typed up every single question ever asked, prior to our being on the show, and we typed out every answer and then we memorized those answers, both Hanna and I, depending on who was handling what. And we just practiced over and over and we invited any friend, especially those ball breaking friends that kind of really just, they really want to just give it to you. Especially those folks we invited over, did the pitch, had them ask questions that we didn’t expect, and just challenged ourselves over and over and over and over again, until we got it right. And so, I would say we were fully prepared, to handle all the curve balls. Now there are some things that came out, that we had no idea. But we did our best. And so, I think because of that being prepared, and being confident that …

One of those things that I will never forget, before those doors opened … And this was advice I got when I was at UCLA, getting my MBA. They said, “When you’re going in to pitch to someone, you’re not going to beg for money. It’s a fair exchange. You’re going to give them part of the hard work that you’ve put, your great idea, your blood sweat and tears. And they’re going to make a nice little penny while they’re sleeping. And you’re gonna use their money in exchange. So it’s a fair exchange and you should never look up. You should look directly at them, from the same level.” And so that really gave us the confidence we needed, to just walk in there and just talk to them as equals. ’Cause that’s what it comes down to. It’s never good look when you’re begging. And I get that entrepreneurs get in a place where they’re really desperate. I understand that, and we’ve had that multiple times in our journey. But when it comes down to it, you’re both humans, and you’re both trying to achieve the same thing. So that really helped us.

Felix: Yeah, you definitely don’t want to appear desperate, at least. Now when you went there, and I don’t think I’ve even seen all of them either, but you guys went through and watched every single show and typed up all the transcripts and everything. Based on what you saw, what are some of the common mistakes that you see entrepreneurs making when they pitch, I guess especially on Shark Tank, that you saw and that you both looked at each other and were like, “We can not make the same mistake.”

Mark: Oh, there’s so many.

Hanna: One was, a typical one that we saw was just saying, “Oh, this is the market size of the baby industry and if we just capture one percent, we’re billionaires.” I think that’s, it’s very delusional. I think the companies that do well and get a deal on Shark Tank, it’s not about what the potential is, but rather what you’re actually selling and doing.

Mark: Yeah, and also, I think there’s this kind of … I think arrogance is the worst, is definitely poison [inaudible 00:44:50]. You’re going in to a pitch with a little arrogance. Confidence is okay, but arrogance is like, “Oh, I already talked to the buyer. I got this locked up.” Well, talking to a buyer and getting a program and a purchase order are two different things. Even a purchase order, “Oh, I’ve got a purchase order from Target and it’s great. It’s a thousand [inaudible 00:45:09]. I’m gonna be a millionaire.” Those are huge, huge assumptions. I mean, until you have a reoccurring sale, until you have how many units per sale per week you’re hitting, you’re really nothing yet. And so I think sometimes, when I see contestants or pitches go in with that attitude like, “Oh yeah, we got Target this year. Next year is Wal Mart.” Like no, it doesn’t quite work like that. There’s still a very, very long road ahead of you. And so , I think if people could take that knowledge and really use it, it could be more of a weapon than it is like a deterrent. ’Cause if I was an investor, I would go, “Okay, clearly you’ve never been through this before.” So I would hesitate more.

Felix: Makes a lot of sense. Awesome. Thank you so much for your time, Mark and Hanna. Lollaland.com is the website. L-O-L-L-A-L-A-N-D .com. Where do you guys want to see the business be, this time next year?

Mark: Oh, that’s a good question.

Hanna: That’s a great question.

Mark: Should I go first?

Hanna: Yes.

Mark: I mean, we’d like to be, we’d like to have a lot more items to offer to our families, like the people that resonate with our brand, that understand that we’re not just a company, but we’re parents too, and that everything that goes in their child’s mouth, went in to our kids mouth. We really think about our kids when we create these products. So I’d love to have a lot more stronger presence in our direct to consumer portion of our business, along with a lot more products to offer.

Hanna: And to that end, I think we’ve worked so hard for the past few years, to just build this sort of multi channel distribution, and I think what I personally want to work on within the next year, is just really attacking and getting at those customers, through a more multi pronged approach. I don’t want to just focus all my efforts on social media. It’s like I gotta do better at email marketing and on top of the social media and Facebook marketing and all that stuff. I really just think that, there’s so many avenues now for businesses to reach customers, and I hope that we can get really good at that in the next year.

Felix: Awesome. Sounds like an action packed year for you guys then. Okay, thank you so much for coming on Mark and Hanna. I really appreciate it. Again, Lollaland.com is the website. Thank you so much guys.

Mark: Thanks Felix.

Hanna: Thanks Felix.

Felix: Here’s a sneak peak for what’s in store the next Shopify Masters episode.

Speaker 5: Design is like an extra voice to have in your company.

Felix: Thanks for listening to Shopify Masters, the e-commerce marketing podcast for ambitious entrepreneurs. To start your store today, visit shopify.com/masters to claim your extended 30 day free trial. Also, for this episode’s show notes, head over the shopify.com/blog.

 


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About the Author

Felix Thea is the host of the Shopify Masters podcast, the ecommerce marketing podcast for ambitious entrepreneurs, and founder of TrafficAndSales.com where you can get actionable tips to grow your store’s traffic and sales.

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