How To Start a Multi Billion $$ Brand (Part 1)

Issue #67

May 21st, 2024

Quick Hits:

⛷️ If you love skiing and you love dogs this could be your definition of heaven

☀️ Do dogs need to wear sunscreen?

🇯🇵 Please don’t write on these cats

🐱 And the Garfield look-alike winner is

🐶 Maxwell chooses a different lap to sit on, every… single… day

This week we speak with Joe Spector, the founder & CEO of Dutch and Hims. Joe’s journey coming to this country at a young age as an immigrant from Uzbekistan ultimately building a multi-billion dollar company and now tackling the world of pet telehealth with Dutch is nothing short of incredible. Here is his story. Be sure to read part 2 which we will release next week.

You immigrated from Uzbekistan to the US when you were 10 years old. Why did you have to flee Uzbekistan and what was your experience like when you reached the US?

My parents and I fled Uzbekistan because we’re Jewish and we were facing mounting anti-Semitism, which is unfortunately a story as old as time for Jews wherever they live. Specifically, anti-Semitism meant losing a job, college admissions rejections, and housing discrimination just to name a few.

In the US, our initial label was “legal aliens” and we certainly felt that way. Everything was foreign and every experience was new. We lived on welfare and in subsidized housing. My highly educated dad had to work for cash at a flea market doing manual labor. I was called a communist by the playground kids. Good thing I couldn’t understand most of what they said since I didn’t know any English. The experiences during those years have taught me resilience and survival. I have seen what it’s like to lose everything and rebuild again and again.

You’re the founder of Hims & Hers, a massive multi-billion dollar brand, that (seemingly) came out of nowhere. How did you come up with the idea and what was it like running a massive company with over 1000 employees?

Hims was an overnight success that was 15 years in the making. I spent years in Silicon Valley working on failed startup ideas. All these experiences led me to Hims. The idea came out of the success that DTC men’s health category experienced from startups such as Harry’s and Dollar Shave Club. There was increased interest in telemedicine. Last, but not least, Viagra was about to go generic. Out of this primordial soup, Hims was born.

Initial smoke tests, along with my intuition, told me this would be a huge idea. At the time, human telemedicine had a ton of regulations that made it quite limited and I was excited to break down those barriers. 

We made many mistakes along the way, but the overall success of the business propelled us further despite any shortcomings. When things are going great, mistakes get easily overlooked. There was so much momentum once we launched and we were too busy growing revenue to get easily dissuaded by the challenges, which was very exciting. When I started Dutch, I was better positioned to avoid some of the mistakes we made at Hims.

You guys were spending a ton of money on marketing, 10 million dollars a month at one point. What were the channels you found the most success in?

This was pre-iOS 14.5 privacy update so definitely on Facebook. We also had great success running ads in the NYC subway – I still run into people who remember those campaigns.

You managed to build a multi-billion dollar company (a unicorn), take the company public, and ring the bell on the stock exchange, you literally are the ‘American Dream’! Could you have imagined this being a 10-year-old immigrant setting foot in the US?

Absolutely not! Being poor and a foreigner, my worldview was very small. What I did know was that America is the land of opportunity. In the Soviet Union, Jews were not even second-class citizens, so it didn’t matter how hard you worked or how smart you were, there was a built-in limit. My parents instilled in me a sense that in America, there’s at least a correlation between hard work and success.

There are many stories of successful immigrant entrepreneurs in the US. What is it about the US, in your opinion, that fosters this entrepreneurial environment that allows so many first-generation (or second) immigrants from all across the world to come here and within a fairly short amount of time become extremely successful?

The image of America as the land of opportunity is renowned throughout the world. In America, there are also no structural barriers to entry to becoming an entrepreneur. For example, there are no rules that preclude specific groups from going to college, asking for VC dollars, or starting a business.

There’s also something special about immigrants. As an immigrant, I’ve had to survive, persevere, and figure things out on the fly. These are crucial skills to being an entrepreneur.

PAWS right there!!! Don’t forget to subscribe 👇👇

3 Biz Insights from Joe Spector

How important is branding in your opinion - from the naming to the logo, aesthetics, URL, UI, UX, etc..How much attention should founders invest in this?

It’s vital, especially when it comes to a healthcare consumer business where trust and quality are acutely important. Like the saying goes, “shit in, shit out” – don’t expect customers to take you seriously if your brand is sloppy. The next question customers will ask: Is the service also sloppy?

What do you attribute to the massive success you had at Hims? What are 3 main things you can point to that you think could be replicable?

1. Strong acquisition engine - We tested lots of channels. No one channel was more than 25% of our paid acquisition efforts

2. Sticky product - Prescriptions for conditions that are a must-have rather than a nice-to-have

3. Investment in brand - We over-indexed on investing in creating a beautiful experience rather than a functional experience.

How important (or unimportant) is it to be the face of your brand?

It’s both important and not important. On the one hand, with a startup, consumers want to know who’s behind this product. The personal side of it helps to establish a relationship and trust with the consumer. Ultimately, it’s about the product and service.

The brand needs to be more than just the founder. Being out front too much can become a distraction. I’ve seen narcissistic founders use their company as a vehicle for self-promotion and ignore focusing on the product and service. This ultimately tarnishes the brand that even a glossy founder can’t repair.

You reached the end, you deserve a treat 🍖

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Finally, What is a dog’s favorite song to listen to after a bath?

“Shake It Off” by Taylor Swift.

See you Thursday!