SPEAKER_00: all right everybody welcome back to twist this week in startups today we've got an action-packed lineup for you first up i'll be talking to justin kwong he's building malengo the easiest way to develop and scale fashion products very cool company that went through our accelerator and then after malengo i am going to talk about my new framework for automating deprecating and delegating inside your company this is a way to just have massive efficiency so if you're a member of my sub stack you may have read this blog post i did but i'm going to really get into details about it and how to implement it in your company it's my new add framework automate deprecate delegate it's going to make you if you're a resource constrained as a startup much more efficient and if you're a big company it's going to allow you to get focused on what matters it's going to be a great

SPEAKER_02: episode stick with us this week in startups is brought to you by vanta compliance and security shouldn't be a deal breaker for startups to win new business vanta makes it easy for companies to get a sock to report fast twist listeners can get a thousand dollars off for a limited time advanta.com twist wizard struggling to transform innovative ideas into concrete product designs wizard can help you turn your visions into polished ui designs in a fraction of time while enhancing collaboration across your entire team get started now and take advantage of an exclusive offer visit wizard.io twist for 25 off wizard pro for an entire year that's u-i-z-a-r-d dot i-o slash twist and eppo experimentation is how generation defining companies win accelerate your experimentation velocity with eppo visit getepo.com twist all right as we discussed melango is here with us

SPEAKER_07: on the show they came to our founder university which is kind of like a pre-accelerator they came to our fifth cohort then they came to our accelerator where we invested in the company they were part of

SPEAKER_09: the launch accelerator number 30. you can find out more about these programs founder.university or launch.co welcome to the program justin excited to share melango with the world yeah thanks for having

SPEAKER_13: me jason excited to jam all right so uh you've had some great success uh since you came through founder university and accelerator we'll get to that in a bit what is melango what's the mission

SPEAKER_12: so melango is the easiest way for any kind of brand or creator to develop finance and scale on apparel line we make it really easy so that you just focus on your dream your idea we handle all the complex parts of that manufacturing process uh and help you scale up when you're ready to scale up so we have a tech enabled dashboard there's some technology that we're using to automate parts of the manufacturing process so that we're able to develop you a product in let's say weeks instead of the typical months that

SPEAKER_13: it takes got it so i'm an influencer on mr beast let's say or the all in podcast crew we let the fans go crazy with the merch um at some point we may reverse that and have to make our own merch so if all in wanted to make merch yes we could use melango as an example of mr beast he probably has merch but if you wanted to make additional hoodies or whatever melango is a service provided through a website to do the entirety from designing your hoodies with ai to manufacturing them in china vietnam i'm not

SPEAKER_09: sure where the the the best places to manufacture are today for clothes india and pakistan i assume we're in there as well and then also the all the way to fulfillment in your store or you don't have

SPEAKER_12: a little the fulfillment we have some great partners on that side and we're just laser focused on on the product development side but even for like the mr beasts or the all ends like if you want a hoodie we can help you make a hoodie if you want a really nice cashmere sweatshirt that's like a montclair level we can also help you do that and i think that's really what sets us apart you know from the print on demand or some of these existing companies out there is the capabilities

SPEAKER_23: so if saxipu wanted to do like a montclair competitor with the saxipu logo on it we could

SPEAKER_13: design that okay so it would be great for you to show us you know this process and then explain to us as you do it what some of the secret sauce is because when i saw this you know coming out of founder university i was like oh wow that seems incredibly disruptive and efficient combining all

SPEAKER_09: these different aspects of making a merch line so show us show us what you about yeah and for those of you listening you can always go to this week in startups uh on youtube and watch us as we do this so go just type in this week in startups and look at the recent videos and you'll see this melango one

SPEAKER_16: right there okay good sorry justin uh maybe share your screen and let's do a little demo sounds good

SPEAKER_31: so this is the moingo app that you get access to and it's free for anyone to sign up you get to see

SPEAKER_12: all of your projects that are in progress the samples that you're making we have this showroom where you're able to browse some existing styles that you can get in free information from or customize them a hundred percent from the materials to the trims to the colors if you think about how apparel was made there's just a lot of manual labor that happens along the way so there's like a product developer that comes up with an idea fashion designer that does a sketch a technical designer that creates like the blueprint you know at the factory you have a merchandiser that's like translating this blueprint uh an account manager pattern maker sample maker so there's all these like manual parts of the process that we as melango handle for you so you come in you can start chatting with the member of the melango team uh this is one of our customer customers who uploaded you know some sketches of his idea out in designs we're able to turn that you know from idea to

SPEAKER_17: a 2d design we're able to get samples and this is all done in a chat interface so what we see on

SPEAKER_09: the screen right now is you're firing up a chat interface you're talking to a melango representative the person uploaded an image just a back of the envelope literal scratch scratchpad those designers on your team start designing and making designs that uh they get feedback from the creator and this

SPEAKER_13: is just all handled in a chat room so you just start working you don't have to go

SPEAKER_09: on fiverr or some marketplace to look for somebody who's done this before you've abstracted that whole process of getting started the cold start problem

SPEAKER_12: a hundred percent and then once we have all that done and you're ready to create a sample we're doing that process for you in you know two weeks max um which is a lot faster than you know even if you're an under armor who's one of our customers it's going to take you maybe three to four weeks to to do that up to if you're a new person starting out on alibaba that might take you months two years so all that's handled for you we're able to finance your purchase order when you have it ready um and just take care of that whole process uh we have like tasks that make it super easy for you to track every part and you know a calendar so this is like what we're seeing

SPEAKER_13: on the screen is a kanban style board we have all the tasks associated with this and one of them

SPEAKER_09: let's go back to that is confirming the details you have to sign a contract you have to approve you have you have to confirm the materials you have to approve a sample and then you finally place your

SPEAKER_40: order so instead of me having to hire a consultant to say hey what are the steps to creating my merch

SPEAKER_09: line you basically have a template right here where you know i guess i could ask chat gpt or maybe notion or code to have a template for this but you have the services and the template

SPEAKER_12: all built into your software yeah yes so you can just live in this and have everything you know done for you and if there's stuff that you need to do you can take action um and transparency is really important too because a lot of times when you're making something you don't have visibility on where is it in the process when is it going to take uh and so we've broken that down by the steps and and make it clear to our customers here's this step and you know it's going to take this long for

SPEAKER_17: that sample to be created so you're basically the project management the design the fulfillment

SPEAKER_19: and managing the factory all of that abstracted in one service yes and that's the hard part i mean

SPEAKER_12: we've iterated several times in this model to get to this is the hardest part that no one really wants to do whether you're a brand or a factory but you know if we're able to help them solve it i can

SPEAKER_17: save a lot of time how much do you charge for this how do you make money is it a software as a service is it a percentage of what you're buying how do you charge so we have development packages

SPEAKER_12: and these are to get a sample off the ground so sample could be a hoodie or you know a really complex cashmere sweater and those are going to range from you know 300 to 500 per product which is still a lot cheaper than if you were to do this on your own we had a customer that came to us having worked with the factory here domestically that was charging her six thousand dollars for a sample wow and she only got one and she wasn't happy with it at all and the factory was like hey

SPEAKER_14: we want to you know charge you an extra twenty thousand to to do a product production run so

SPEAKER_17: they're price gouging they're trying to make a home run off somebody who's a sucker who doesn't

SPEAKER_13: understand how much work the stakes i assume when you charge somebody three hundred to five hundred

SPEAKER_53: to design their hoodie and get them a sample you're just breaking even on that that's not like a

SPEAKER_12: money maker is it uh not right now i mean over time we'll be able to automate more of that to to make some money on that side but really we're helping you know creators and brands do production runs so our minimums start at 50 units uh you know we have all the way to we have brands doing thousands of units at a time and we'll make a small margin on that uh you know on the factory side

SPEAKER_58: uh and that comes out of the factory side or the person placing the order it's abstracted through it

SPEAKER_12: how does all that work it's a combination of both uh margins but it equals out to you know if you're a customer and you wanted to source this on your own roughly the same pricing that they would get if not a little lower just because we can negotiate bulk buying from a lot of the factories

SPEAKER_17: we work with and yeah so that's your speciality if you can lower the price for them you can get

SPEAKER_09: some of that margin that they wouldn't be able to get themselves so everybody wins listen a strong

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SPEAKER_17: vanta.com twist for one thousand dollars off your sock two so everybody wants to know for a startup how do you get the first couple of customers for this were you in this industry before had you had

SPEAKER_09: experience so that that sort of cold start problem for your startup not the people making you know

David Friedberg: mr beast are all in making their merch or this week's starts merch but for you as a startup you have a cold start problem so did you come from the merchandise background did you have your own line

SPEAKER_09: how did you come up with the idea and then how do you get those first couple of customers to buy into this

SPEAKER_15: yeah my last company was a direct consumer brand making bags and accessories for working professional

SPEAKER_12: uh grew that to a few million in revenue but it was really challenging to grow the brand just because we couldn't launch product fast enough it would just take us you know eight months to a year um and we couldn't be competitive to where companies would come and knock off the bag and do it at a lower price point and i think to be competitive in e-commerce or d2c in general you need speed you have companies like sheen and timu that have taken over retail because they're launching 10 000 new products a day so everyone's really playing catch up um and so to how we got our first customers and really a combination of just referrals and some of our network on the supplier and brand side and so explain to me how

SPEAKER_13: fast fashion works if i liked a certain bomber jacket let's say i like there's like a brand roan there's a brand cuts uh mac weld and i got a couple of these men's brands that you know i'll buy their t-shirts and really enjoy them but let's say i wanted to take my roan hoodie and i wanted to adapt it and make it my own and you know put the this week in startups logo on it or the launch logo or founding university can i just point to that and say to you hey i want something similar to this jacket or this hoodie combination you know from this brand and then you can start the process of finding out what factory

SPEAKER_12: can make it the materials etc when you work with us that's exactly what you can do and we have a lot of people kind of bring mood boards or inspirations of all these different styles that they like and say i want a bit of this and a little bit of that but definitely this zipper from this you know other jacket and we kind of help them mash that up into a really unique design and then develop that product

SPEAKER_13: and my understanding of fashion is you can't really trademark or copyright like a blazer or a hoodie right you can do your logo but you know like if i've got some double collar or uniqueness to my thing it's not really protectable ip is that correct and that's why fast fashion exists yes there's certain

SPEAKER_12: things you can i think trademark or copyright on like patterns or prints or like definitely the logos but from like a garment perspective there really isn't a lot of protection there and that's why you get a lot of these small you know designers and brands that get ripped off by the the fast fashions of the world um and that really is part of our mission where we want to empower these designers and creators and small brands and say hey shein and timu have taken over with their fast and agile supply chains let's build something similar and give you access to it so you can have

SPEAKER_13: that kind of agility too got it and when you brought this idea um to the venture capital community seed investors after you went through our program did they look at it and say uh oh this is like a service business or this is like a manufacturing business it's not venture scale or do they look at it and say you know like some of the investors in uber or airbnb hey there are real world things that need to get done and then there's a technology stack on top of it so you know the

SPEAKER_09: person who's bold enough to take on a little bit of friction gets the benefit of this wider network effect um how did the venture community and the c community look at melingo yeah i think there's a

SPEAKER_12: lot of people that didn't get it and they're just like how is this better than a custom ink or print on demand where you're literally just slapping a logo on an existing you know medium to low quality blank but i'd say i mean i've learned that investing incredible they didn't understand that basic

David Friedberg: difference they didn't it's the thing i don't think a lot of i i'm i'm sure there i i know because

SPEAKER_09: you did very well with your uh fundraising that enough people got it but it's just amazing to me

SPEAKER_40: how stupid some um partners are at venture firms or seed funds that they don't listen deeply to the founders vision here and and the problem or talk to the customers because if you were to talk to any

David Friedberg: of your customers they would be able to explain like no we don't want a ishi shirt like a bad

SPEAKER_40: disgusting shirt with our logo on it peeling off right we're trying to build a unique garment that you know might sell for 10 times that amount that's signature to us like what you're trying to do if correct me if i'm wrong here is enable the next yeezy right like the next yay i guess his name

SPEAKER_23: is yay now i want to be respectful to his new name not his uh kanye west name but kanye west created yeezy

SPEAKER_40: yeezy i believe and yeah design clothes you're for that person correct not a person looking to make

SPEAKER_13: a logo for you know their corporate off-site absolutely we want to help the next you know

SPEAKER_12: kanye's of the world create the next yeezy's and you know even if you look at what gay is doing right now with yeezy doing 20 drops and everything is 20 dollars it's very mass market um you know even being able to help companies like him because they're gonna have to develop so much product to to be able to scale that um too but going back to the investor part jason i think the investors that got it were people that experienced the problem themselves or had family members or friends that were like i want to try to start a clothing brand or i have a brand i'm trying to scale it and understood the problems that they're running into i think we got lucky in finding our perfect match i know the term used a lot is like you know finding investors is a lot like dating you know it's about compatibilities and seeing you know who's a good fit and and and all that and we got lucky that we found a great match with cyan banister who i think had a thesis in the space and just saw the vision

SPEAKER_09: you know a long time ahead too and so yeah and cyan so people know is one of my oldest friends in the industry we both became angel investors at the same time and i introduced her two really good investments a cap company and a and a marketplace for home services thumbtack and uber and so we invested in those together uh and uh we also invested in density as well together and she's just tremendous what was her thesis and when it clicked with her what did you learn there about

SPEAKER_13: what i'll call investor um product fit like if the investor really does love the product or service man that does carry the day in my experience like this is why uber did so well raising money and airbnb did not airbnb does not appeal in the first version to a venture capitalist they want to stay at a five-star hotel luxury hotel they don't want to stay on somebody's couch but uber started with luxury cars so lincoln town cars were exactly what you know having your own private your

SPEAKER_09: your own private driver was the original tagline so investor product fit is really good clubhouse also had investor product fit because vcs like to talk and hear their own voice so yeah tell us about those

SPEAKER_12: meetings and how she got it she was actively thinking about the space i think she had tried to make some of her own products on alibaba and had a thesis that like there's going to be a company that just makes this whole process a lot easier and maybe the manufacturing is in china maybe it's not maybe it's in these other parts of asia or near to home in latin america but something that helps all these makers all these individual artisans um turn their dreams into reality and i i think she had blogged about that or tweeted about that a couple years ago and and i took note of it as we were building moingo being like i i have to be here someday and talk to her about what we're building and you know luckily i introduced her through jackie and ryan through the accelerator which was really nice and 10 minutes into the first conversation she says yes um just because she'd been thinking about this and you know whether it's through a long journey that she's a gp and or is an angel

SPEAKER_17: um amazing yeah we just got very lucky you had noted because you track other investors on social media

SPEAKER_13: and on her instagram tick tock twitter whatever x she had been talking about building uh merch so that

SPEAKER_09: was or building fashion design i guess merch is like a too dismissive way to say it it's more like building a clothing line yeah building a brand yeah so you you raised the money um you did very well at the accelerator i don't know how did you do in terms of voting i'm curious for people who don't know at our accelerator we ask every week the vcs to rank their top three companies out of the seven we do this for two reasons one uh because it's entertaining it keeps people awake and um well maybe three reasons it keeps people awake during the process of pitching um two it makes a little bit of a competitive environment between the founders which is always good and three and if you pick somebody as number one two or three and you're an investor you kind of got to meet with them after right it gives you a little bit of hey you picked us as number one you picked us number two can we do a follow-up meeting so that's a little my own machiavellian way of organizing it but how did you do in the in the voting i'm

SPEAKER_12: curious because that's why it's sent yeah i mean we ended up uh at second behind tax gpt cash is a great founder there um but it's a great camaraderie i think it's really exciting every week we're kind of like friendly but also we just want to beat all the other companies in the cohort and we got lucky with just an amazing group of founders um in that cohort in general and um yeah just just every week there'd be a new demo i think one of the interesting unique things about the launch accelerator too is that um you get the option to defer the program and this was really helpful for us in the very beginning we came out of founder university i think it was june uh we got accepted into the accelerator but we had we hadn't really figured out how to grow yet and we had you know some customers we're still figuring things out and so we took the 100k and said hey could we defer this till later on and we joined in october built some momentum and that really kind of helped propel us

SPEAKER_74: later on yeah i've come to realize like i like to meet founders where they are so at founder university

SPEAKER_09: we would give this 25k check if people just wanted their first check um you know not everybody can afford the 25k it takes to kind of startup operations get incorporated whatever and we did that as a test it turned out like two out of three founders asked for that we were like okay wow that's interesting now we didn't give it to everybody who asked but we started giving out maybe we did 50 60 70 of those checks which is kind of interesting to do a million dollars in those checks so i noted that yeah and

SPEAKER_13: i just decided after your experience um to offer people the standard yc tech stars deal because i don't know how i got to 100 i think it was because my fund original fund was 10 million so i was like oh 100 100 k bets but then i changed it to 125 just recently this year so that people don't have to think oh it's different than yc or tech stars it's just apples to apples kind of situation for seven percent and then we told people check this box if you want it and we'll just give it to you you don't even have to come to the accelerator um because of your experience and now we've got i think two out of three founders say i'll take the 25 or the 125 and so then we get to make a decision do we want to own 2.5 percent seven percent what makes sense and again meeting the founder where they are if they want us to give them 125 they want to come to the accelerator they don't want to come to the

SPEAKER_09: accelerator they don't they want us to just help with introductions i'll just customize it to the to the founder is my experience because i just want to help the founders because at the stage we're at 80 go to zero so if you come into it with that expectation kind of freeze you like all you want to

SPEAKER_40: do is just be as helpful as possible knowing very few of the turtles make it to the ocean a lot of them get eaten before they get to maturity uh it's kind of dark right now startups have to do more with less we all know that and that means increasing your product velocity while maintaining or even lowering your costs now don't forget product velocity is how startups beat incumbents so here's the great news ai is going to help you do that so let me tell you about wizard it's spelled uizard it's an ai powered suite of ui and ux design tools with wizard you can generate your app or web designs from simple text prompts you can then iterate on these designs with an ai assistant and then you hand off your completed designs as react or css code wizard's text to ui mock-up tool is called auto designer and it's really cool if you're watching you can see it on the screen right now here's the brass tax wizard is going to help you go from idea to mock-up in minutes so if you're creating a product from scratch this is going to save you so much time start building products today faster with 25 off wizard pro at wizard.io twist that's u-i-z-a-r-d.io twist for 25 off stop wasting time and start shipping faster so tell me more about you know being a seed stage company what do you feel you need to accomplish

SPEAKER_13: in order to get that coveted series a the 10 million dollars from sequoia or i don't know what your top firm is you know antonio and valor or sax and craft you know getting on chamat's radar at social capital

SPEAKER_09: what are the goals you have to hit in the next i assume 18 months of runway 24 months of runway what

SPEAKER_12: do you have yeah i think i mean there's some quantitative metrics that we want to be able to hit we want to be at a certain runway whether that's like two to three million net revenue um but i think on top of that we really just need to have the the confidence that what we're doing can actually scale uh with really good unit economics too on the sampling side you mentioned that and you know barely breaking even there we'd love to be in a spot where we're actually making money there so we could just help as many people make samples as possible and then we're we've brought on um you know a little bit about my founding team greg who i met who's one of our co-founders he came from like the textile world at nike so that brings a lot of manufacturing experience uh bond who we're bringing on as a co-founder cto i actually met through uh one of the syndicate type of demo days early on and she started as an ai advisor um but we're one of our syndicates one of your syndicates yeah back

SPEAKER_88: in like october i think explain that to folks it was like a like a digital demo day um where you had

SPEAKER_12: the ability to uh present in front of you know some of the members of jason syndicate uh and get some feedback there we got some amazing connections out of that too and and bond was one of them who has been like an advisor to us and uh we're bringing her on as a co-founder because she went teams at meta doing ai so we're like how many founders will you have we'll have three total perfect that and you

SPEAKER_09: know this is something i've learned over time it's something i learned from paul graham he always

SPEAKER_13: accepted multiples into y combinator and i was like ah you know i'm a solo guy maybe whatever and it turns out he's right you know at seed stage there's very few so there's very few solo founders

SPEAKER_09: who can make it work and even the history books may tell you you know certain people were solo founders and they get like some disproportionate credit but then you go back in the history book and you realize oh yeah there were three co-founders of you know youtube people forget javid oh there were three for

SPEAKER_13: snapchat oh there were three for airbnb it's like it's kind of a pattern folks like and so we have

SPEAKER_09: become very biased towards two or three co-founders because one event inevitably moves on to something else in life and then you have two where you have one so it's just it's like a redundant so

SPEAKER_12: even in getting getting to a couple million i think the hard part about that jason is that because we're we make a lot of our money on bulk production and this is like a delayed timeline we don't see that immediate you know revenue gratification month over month so something that we try to think about too is like how do we really focus on our inputs um so we're saying like you know revenue is a lagging indicator let's just really focus on uh certain inputs that we can control whether that's like 100 samples or you know one hour better on customer success time and then hopefully revenue will trail after that um one thing that we're focusing on now as we try to find product market fit and i think raul which you you invested in on the superhuman side uh created this really good framework for finding product market fit i think there's like a first round capital

SPEAKER_17: blog post about it yeah product market fit engine i think he calls and he i was the investor in his

SPEAKER_09: first company uh which was called reportive and then i was the first investor along with uh darmesh from hubspot in his second company superhuman and yeah he really is an expert on understanding product market fit and you are you essential to that group of people or if you went away would they be like okay i have another solution for this and with yours it does feel like if you got addicted to this process man you do good how do you acquire new customers how do you how do you get a new customer who's going to do hundreds and then eventually thousands of you know items we get some great referrals and word

SPEAKER_12: of mouth especially on the enterprise side with brands that are looking to launch new lines so they could be doing footwear and want to get into apparel um we're also doing a bunch of content so that's for some of our newer entrepreneurs educating them on different parts of the apparel manufacturing process what is that blog posts or tick tocks blog posts so we're getting more into like video content so like tick tocks and instagram reels um we have some great partnerships too on the creator side there's a platform called fourth wall that has i think like two million monthly active users and we're one of their first custom apparel manufacturing partners so if you're making something on fourth wall you know you can make it they're your products through us and then sell them on fourth wall fantastic

SPEAKER_09: and what about how what role does shopify play in all this for you um and would a shopify partnership make a difference or is it just up to the resellers you know what they do can you put

SPEAKER_07: something in the shopify app store that would i would goose this as a marketing channel yeah that's

SPEAKER_12: a great idea and that's definitely something i think we're going to move towards as we want to get more of those shopify brands and work closely with shopify um just because we have a lot of that product data on what they're what they want to make and you know what they're making it'd be interesting

SPEAKER_09: since ai is getting popular these days i wonder if you could pick 20 different targets and then use ai to make 10 skews for each and then send them their designs and say hey listen these are very rough

SPEAKER_13: designs but we know your brand mr beast and we know you did feastables so we made a line of feastables you know sweaters hoodies whatever and you know hey you just send it to mr beast and his team and they look at and you say hey you know we could get these going i could send samples you know let me know you you kind of would have done that 500 300 to 500 work ahead of time and kind of given it to them for free so it's a little bit of trust there like you may have spent you know a couple of hours of doing

SPEAKER_12: it so but that's how they get inspired and they're just like yeah i like this or this is a good direction have you tried that before like sending the work we we've tried it we've tried it in in different varieties in terms of just like creating mood boards or um you know i think we were even doing that for like a this week in startups like we had some different polo shirts that you guys thought might be interesting um so that's that's definitely a great idea this is something i want to make for

SPEAKER_39: my team i was realizing my team does like 80 calls a week with founders and we you know we do the nice

SPEAKER_09: backgrounds where it has the launch logo and their name and their ad so it just helps with like branding what i want to do i hate to say a uniform but i wanted to give my team a hoodie you know it says founder university or launch accelerator or launch whatever it is and give them polo shirts or whatever and just say hey listen when you're on calls with founders or other vc firms you know swag up you know logo up so we can be proud of our logo reinforce it and then maybe if you meet somebody you like them you could send them you know one of these things so i do but i want to go more like uh hoodie jacket kind of you know quarter zip kind of style so i'm definitely going to get in there because i want it to be more expensive i find when you give people cheap shirts they just cut them up into rags or they give them to like homeless people like literally i would

SPEAKER_13: founders don't buy cheap swag it gets thrown in the garbage but if you buy a high quality one and you

SPEAKER_40: make the logo small and subtle yeah and people actually wear it and that's what you're looking

SPEAKER_12: for that that's my best advice i don't know you want the stuff that people are going to want to resell on ebay but not for the bad reasons you know just because it's yeah it's a great quality

SPEAKER_09: product yeah exactly i know people do that with the all-in swag and uh some of the speaking service right all right listen continued success um it's been great to get to know you justin and your team we're really proud of the effort you've put in and i love the product velocity and you know really keep at it i think you're going to have great success i think we're going to sit here and look back on this video i think you're going to be like a unicorn i honestly think you're going to build a billion dollar company and i can't wait for you to hit these milestones i can't wait for you to get that series a you got to get to two or three million is your goal you know that means you probably need to be shipping what 20 million in product something like that 15 20 million in product so it seems doable you know if each item is you know two hundred dollars you know whatever that is you know

SPEAKER_03: a hundred thousand items have to be shipped or something like that so it doesn't seem impossible right a hundred thousand items if everybody ships a thousand you need a hundred clients to a thousand

SPEAKER_09: items or you need 200 clients to do 500 items each i think you can do it i think you can do it i really believe in you and the team thank you jason so yeah excited to have you part of this journey oh yeah

SPEAKER_03: it's going to be great i can't wait to start tweeting this stuff out i'm always good i always tell my founders like if you release good product like you know write some great tweets and then

SPEAKER_09: you know we'll interact with it i think it's one of the things um you know that our team has been doing particularly well in the last year i've been asking my team to work with the founders to teach them a little bit about social media and telling their story in blog posts tweets tick tocks etc and then send it to us and share it with the rest of the you know four well we got 700 founders in the founder slack and we tell them hey share it there and we try to do like this weekly thread and then you know you get three or four of your classmates to like something you like their stuff you reply to it you know one of those three threads could get a cyan banister you know you get a sequela somebody might see it and say oh that's interesting so tell your story you know and be absolutely out there with your logo uh you know that's the other thing i don't know if the team did that this time but i was like everybody should have a shirt with their logo on it

SPEAKER_40: on the front and the back you know so when you're at a demo day you're at a party and they see the back or the front and it's like make it an orange shirt make it a bright yellow shirt make it like you can't miss it shirt with the logos on it be proud be the brand absolutely this is why for us it's all

SPEAKER_12: about dreaming it you know all you have to do is dream it we'll take care of the rest love it all

SPEAKER_13: right everybody check out melango.com it's uh m-e-l-e-n-g-o.com correct absolutely and uh it's justin huang and he is on uh twitter jk wong right yes sir there it is j k wong yep on twitter j k w o n g j

SPEAKER_16: quong on x interact with him and hey listen if you're listening to this and uh you get value from

SPEAKER_13: listening to this week and startups and you say oh i wish i could do j cal a favor you know what you can do just go check out my startups and see if they're like appropriate for what you're doing or spread the word that always that makes something the most to me it does mean something doesn't it um it's hard to get the word out because there's so much good stuff going on in the world you got to kind of rise above the noise so keep doing that i really think tick tock videos where you

SPEAKER_09: get a tick tocker to talk about hey i'm making my own brand with melango and you know whatever and here's what i'm doing so like my guy chef's reactions you know chef's reactions he went through founder university chef's reactions is my favorite i'm gonna check him out yeah he basically

SPEAKER_13: will just like either roast or praise somebody with who's cooking on tick tock and you know he does like the side by side and his brand is i watched the video and you get my first reaction to it and you know some people are making absolutely disgusting junk food with no consideration and then other people

SPEAKER_09: are doing like really well thought out or simple food that's great and he kind of does his chef's reaction to it and he's becoming a bit of a brand and i saw he did hats at some point but he really

SPEAKER_13: should be doing aprons and even more you know intricate stuff so it'd be amazing for you to do a collab with him and then even if you did like you know 100 shirts for free or whatever and it cost you a grand that's like kind of cool to kind of get the flywheel going with these folks and i know that the cheap you know merch brands are out there kind of doing this stuff so anyway yeah there's so many ways

SPEAKER_40: the way you know you have a great startup is when investors can't shut up about it and have a million ideas like cyan's got a million ideas for you probably better off listening to her ideas at this point she's a brilliant brilliant you're the marketing guru i have my moments i have my moments

SPEAKER_160: you know i like your brand name i don't know what melingo means but i love the way it sounds my co-founder

SPEAKER_12: greg came up with that and it's inspired by the swahili word for goals uh goals and melingo is actually with an ma but i was like we have to have the dot com and we need to rank number one on google so m-e-l-e-n-g-o is a riff on melingo as goals but we own the ip i love it melingo is just it rolls off the tongue i

David Friedberg: think it's going to be like a great asset for you all right everybody yeah if you want to be like justin go to founder.university and apply to come to our 12-week course uh it's basically free we charge you

SPEAKER_09: 500 to reserve your spot if you come to all 12 weeks which is monday nights for two hours you learn some stuff we just charge you back the 500 and 96 of people complete the program for that and so uh we don't charge we just hold your money for 12 weeks and make sure you learn something and then uh the accelerator launch.co apply launch.co apply that's where we give you 125k for seven percent just like y combinator just like tech stars and 500 global all those great programs pretty similar uh i do a great job of getting you intros helping you refine your pitch helping you learn how to grow uh and for the accelerator we're kind of looking for people who have a product that's in market maybe one or two customers 10k a month in revenue whatever it is for founder university you don't even need to be incorporated you've got to have two or three people working on a project and maybe show us some

SPEAKER_03: screenshots or your business plan and we'll accept you if you got two or three really good founders see

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SPEAKER_62: all right everybody i wrote a substack i'm getting back into writing but one of the things i want to do is take the essays i write i started a substack and you can get to it at calacanis.substack.com it's free

SPEAKER_170: right now i may i may do a subscription later but for now i just want to write something once a week-ish and really try to help founders with advice that i'm seeing and i'm deploying in my companies and

SPEAKER_171: the companies i've invested in and i wrote a blog post i'll pull it up here uh during the show as i talk about it and i've been thinking about productivity so the title of this piece i wrote is startup productivity in the age of ai colon automate deprecate delegate add get it attention deficit disorder people tell me i have it but i'm in the generation where it was undiagnosed so

SPEAKER_16: we just drank coffee we didn't take adderall or anything i've invested now in i think about 400 startups definitely over 350 and i've watched really up close and personal all of the productivity hacks that startups do now why is this important well startups are resource constrained when you do

SPEAKER_171: a startup unless you're rich and listen some rich people start companies billionaire start companies

SPEAKER_176: they put 100 million into it but most people have a small amount of resources and they have to make that money go far they've raised 100k from an accelerator or they passed the hat and did 150k from friends and family or they did a small pre-seed round of 250 or a seed round of 500k

SPEAKER_171: it's not actually that much money and hopefully you have two or three founders but then as you start to grow uh you you need to add people and what you constantly want to do is you want to look at the

SPEAKER_176: work that's being done in your company and ask yourselves three simple questions the first is can i automate this okay can this be automated with software and software will fall into three

SPEAKER_170: categories writing code like you know developer running software making no code software um and then using new tools like coda and notion to build apps that last one is what i've been doing mostly we do some no code stuff too but we don't have developers on our team but we do automate stuff using coda and notion zapier which makes you happier and all these great products bubble on the no code side so number one can you automate it number two can you deprecate it deprecated in our industry means stop doing it uh so can you deprecate it or can you delegate it and that means having somebody else do it deprecate pretty simple we're going to stop doing this why are we going to stop doing this it's not having an impact and it turns out your employees will very often out of loyalty to you you'll tell them to do something and they just keep doing it every week why well they want to be loyal to you and it gives them something to do because they want you to get value for the money you're paying them but you may have failed as a manager and they're doing something that actually has zero impact and so you're paying them for 10 hours they do some report for 10 hours every week and you forgot that you ask them to do it this is why it's very important to have a transparent management system how do you do a transparent honest assessment of the work everybody's doing well you could do something which most people would consider a bit oppressive which is time management clock in clock out this is what attorneys accountants designers and consultants have to do because they have to bill those hours to somebody so they when they're doing their day they got time management software on their computer and they say 9am to 11am i'm working for this client 11 30 to 1 30 i'm going to bill to this client no that's out of necessity and and people do it but most companies do not micromanage

SPEAKER_176: people to that level however time management if presented as to an employee to a team member as hey you should do time blocking on your calendar you can look that up and hey you should report back to the rest of the team your teammates what you're doing why you're doing it and and what you intend on doing so i created a very lightweight framework for this i call it the sod eod framework start of day end of day i ask everybody who works for me to go into our slack channel and just say start of day

SPEAKER_170: these are the three things i'm working on today it should take only five minutes and then at the end of the day reply to that same message here's what i got accomplished and to link to a notion page a

SPEAKER_176: coda page a google doc a slack conversation whatever it is a database of hey here's that right so uh here's that work as one example if we're doing this week in startups we might link and the producers if they say i edited this episode they'll link to the episode so people can see the episode uh if they're on the investment team they say i met with four companies they list the four companies they met with

SPEAKER_171: and they link to that company's profile in our database of companies so once you have the sod and the eod you can then ask people to consolidate those into an sow and an eow yep you guessed it start of week end of week and you just say at the start of the week these are the big things i'm working on for the week at the end of the week you recap it now if everybody does their uh end of week correctly you will start to see patterns if somebody were to leave your company all you have to do to replace them is take the last 10 end of weeks and you consolidate them and you just categorize

SPEAKER_176: them and say okay this person was doing this in accounting they were doing this with the sales department they were doing this with this reporting they were doing these one-on-one meetings okay let's take that list of the 10 things they do we'll estimate what percentage of their time is we

SPEAKER_171: don't have to have time management uh most people don't find time management a bit oppressive some people use like productivity stuff like i use this uh because people tell me i have add and this is called the time timer um or a pomodoro method where you can set a timer so what i do is i

SPEAKER_176: say hey i'm going to do 20 minutes to write this blog post when i wrote this blog post i set it at 20 and my mind works in a nice 20 minute increment and then i click it and it counts down very simple

SPEAKER_171: right and so that's how i do time management because i can with if i do have add i don't know

SPEAKER_66: with these diagnoses i'm not a psychiatrist but you know i can say i'm going to do this for 20 minutes

SPEAKER_171: go get a cup of coffee walk to the kitchen take a walk around the block have a bite to eat whatever

SPEAKER_176: it is check my email for 10 minutes and then i jump back in i do 20 minutes of email i do 20 minutes clearing my slack and i just press the button start the clock and then it tells me when i'm done and then

SPEAKER_171: i'll go over time hey i did 20 minutes i feel really good about this blog post boom i'm gonna click it again okay so now you've got the person's leaving your company okay let's look at what they did oh they were emailing all of these customers asking that and sending them this message every month a report on how their advertising did whatever hey you know all they're doing is cutting and pasting from here into an email and sending it okay we can automate that with zapier and coda oh we could do that in notion oh we could send them a live report in a dashboard great we're gonna automate that now we've recaptured 10 hours a week of that person's time okay so now we have 75 left okay oh it turns out these reports were internal nobody looked at them we looked at the click data nobody opens them these reports are not necessary we we don't need them okay so we're gonna deprecate that okay now what's

SPEAKER_176: left okay we got 50 left okay uh we do a survey and we ask you know each of the employees these things okay we can't really automate it it's a phone thing we have to get on the phone with these people and uh do an interview okay can we delegate that well who do we delegate it to well if you go to upwork if you go to fiverr uh let's say you were doing an onboarding call or qualifying a customer well can you do that somewhere else can you do that somewhere cheaper well in san francisco or new york let's say most people are getting paid 40 bucks an hour just use the 2 000 hours a year as your guide right

SPEAKER_170: most people work 2 000 hours a year 40 hours a week times 50 weeks a year that's 2000 some people do

SPEAKER_171: 2300 2400 some people are screwing around they do 1600 they're goofing off at work remote abusing remote work let's just average it to 2000 you got over performance you got under performance don't sweat don't sweat that plus or minus 20 right now you should long term but you don't have to sweat

SPEAKER_176: it right now so 2 000 hours times 40 an hour 80 000 well is that an 80 000 opposition no it's really

SPEAKER_171: like a 65 000 position because that person gets benefits and time off typically they wind up working

SPEAKER_09: about 47 weeks a year because you got vacation and uh holidays and off-site meetings whatever else you

SPEAKER_176: do at your company um so you have to fully bake that salary so if it was 80 it might go to 100 2 000 hours into a hundred thousand dollars so maybe that's an 80 000 employee with 20 000 in benefits time off etc now you're at 50 bucks an hour okay let's take that 50 bucks an hour an 80 000 salary as our guide right now that's a mid-level executive uh an entry-level executive in san francisco or new york

SPEAKER_171: with have high rents that's an incredible job in middle america that's a high-paying job in salt lake city that's a high-paying job in texas right so different places uh because if you're doing remote

SPEAKER_176: work have different salaries so you could literally get two for one in some places right a 40 50 60 000 a year work from home job you know there are people in middle america canada portugal who maybe they're waiting to find that job and it's hard to find this is how the world's changed so as the founder of the company what i want you to do with the rest of the tasks is ask yourself well i had a senior person doing this task for the last two years and their salary went up to 100 150k whatever it is they're getting

SPEAKER_171: paid 50 75 a hundred dollars an hour right so 150 000 senior person is getting paid a hundred dollars

SPEAKER_176: an hour right or so 75 an hour 100 an hour well if you got somebody like that and then you go on fiverr and you find somebody who's done this uh specific job and they love doing it and they're charging 15 an hour well that's one-fifth of the 75 an hour so then you say okay we'll add five dollars to that 15 in management time for somebody's got to manage that person right it's got to fully bake this now we're outsourcing it for twenty dollars that's a third of the sixty dollar employee a fourth of the eighty dollar employee you get the idea so you want to look at moving those i don't want to say simpler or basic tasks but let's call it what it is these are simpler or basic tasks you might be able to find somebody in manila or argentina and this is how the world's changed there are education systems in the philippines singapore south america canada places that you know you might not have you might never have had an employee that can do the work for much less and what that does is it allows your quote unquote higher level let's just call what it is higher paid more experienced people to do the higher paid more experience necessary tasks if you do this what you'll find and you got to do it every

SPEAKER_170: year and you may even want to do it every quarter if you start automating stuff you recapture 25

SPEAKER_176: people's times if you start deprecating stuff you're probably going to get another 25 people's time and then if you delegate it you may reclaim 10 20 30 percent of time depending on you know how much uh chores have accumulated to that person and we see this happen all the time in our startups some highly paid sales person who's making you know 75 000 base and a 75 000 commission plan or more is doing stuff that a 10 an hour person offshore would do why why are you doing that why are you spending 60 doing a 10 an hour job makes no sense give that person the resource to manage so if you had 10 sales people if you gave them all an offshore uh administrator to set their meetings up or you automated it with calendly right those are two options perfect example well maybe you could automate that we did this with our investment team we use calendly we send a link to founders we tell them pick pick a link and uh sign up for a meeting now there's no back and forth we put our calendars in there boom they pick it we're done there's no back and forth scheduling stuff so automate deprecate get rid of and delegate if you do these three things you're going to be so efficient it's wild and the reason this is all getting catalyzed is artificial intelligence which i haven't brought up yet but let me explain how ai is helping this the group of people i'm talking about who are you're going to delegate to whether they're in manila in the philippines or argentina or brazil or portugal or canada places where you might like an administrator in some of those places argentina and philippines they could pay five six

SPEAKER_171: bucks an hour if you were to put a seven dollar an hour job in one of those places you would get too many people would apply for that position they're typically getting paid twelve hundred dollars a

SPEAKER_16: month a thousand dollars a month if you can find a really great one you might go up to three thousand

SPEAKER_171: per month thirty six thousand a year to find an administrator an operations person for thirty

SPEAKER_170: six thousand dollars a year seems impossible there are people i've watched who have used outsourced assistance in other markets and they figured out how to do it years ago and they'll have two or three executives uh using one person and getting massive gains so twelve thousand dollars per executive to have essentially an offshore assistant it actually works now ten years ago it kind of worked now it's working and it's working in a major way those people are the first people the people on fiverr the people on upwork the people who are remote workers it turns out they are typically have been involved in something called business process outsourcing you look up bpm basically how do you do something like

SPEAKER_204: accounts receivable like menial accounting tests how do you automate that and make it faster okay take

SPEAKER_170: a picture of the invoice scan it doing data entry all that stuff's been going on for 30 years in india

SPEAKER_171: philippines etc and law firms and tons of people leverage those kind of places to do literally uh data

SPEAKER_07: entry all of that has led to automation so these folks have been grinding out and they get the major benefit of doing automation automation started with ocr optical character recognition you know scanning

SPEAKER_176: documents and now with ai they're all on chat gpt they know they can take a picture of an invoice and pay it and write a script and have ai do it so they have on the dl been doing this kind of thing automating their work why do they want to meet their work okay you could say this is a little gray hat but they'll automate their work in order to service more customers in a shorter amount of time so they're doing their own little arbitrage on the back end they might have 10 customers and they're doing uh what's called ser sales development reps basically looking for customers for you to sell your product to and chewing them up putting them into a database creating an email sequence you know all this stuff well well those folks they will quietly automate their own work not tell their customers but still charge them so the customer thinks this is taking 10 hours it's taking 10 minutes and then they arbitrage the other nine dollars and 50 cents and you as the customer like well i'm

SPEAKER_171: getting somebody for seven dollars an hour to do this or twelve dollars an hour to do it i'm happy with

SPEAKER_176: that price so this quiet automation some cases it's a little on the dl they're not telling their customers in other cases they're up front about it and no moral judgments here people in different parts of the world look at these kind of things differently i've learned uh so if they can do the arbitrage they're happy for you to pay you know uh and and they kind of take the game and they feel like they deserve it okay let's put the morality out of this you're offering a service at a price they're giving you the service at a price if you can get a cheaper price then go for it now that is happening to american workers at higher level tasks because of chat gpt it's happening to video editors who edit this show they're going to get more efficient they can do clips well the clips could be done by ai so maybe you know a really good clip makes a professional video editor take three hours and then an ai based clip takes 20 minutes it's not as good but maybe they start with a 20 minute clip and the three hours or 20 minute meets somewhere in the middle at 90 minutes this is all happening and this is great what it means is your company your startup is going to gain in my estimation you should

SPEAKER_171: be gaining at least 50 percent productivity per year at least in my company i want to double everybody's productivity per year that's a higher goal but it's an obtainable goal because that's

SPEAKER_176: just becoming about seven percent six or seven percent more efficient per month means in about

SPEAKER_170: 10 11 12 months you will have doubled your efficiency if you can't be six or seven percent more efficient every month what the heck's going on here something's wrong you should be able to be seven percent more efficient and the rule of 72 you look that up online states that if you can be 7.2 percent more efficient during a time period it's that number of time periods you divide it into 72 that you will uh double your this is compounding interest you'll double your efficiency so seven if you're 7.2 percent more efficient per month in uh 10 months you're going to be uh twice as efficient if you're 7.2 more efficient per week in 10 weeks you're gonna be more efficient if you're 7.2 percent more efficient per day yes you guessed it in 10 days you'll double your productivity this is why focusing on your game and studying how you do your work is critically important now of course what i'm saying will scare people and i'm fully aware of that i totally get it people are scared about their jobs in the age of automation what you need to convince everybody is if our company can grow revenues by 30 a year and everybody in the company gets 50 percent more efficient we uh will then have more profitability

SPEAKER_176: every year which means when you ask for your raise or you want a bonus uh or you think about job security you're going to be locked in and more secure so the people who proactively do this on

SPEAKER_171: teams and say you know what boss i looked at my last three months i deprecated this i got back 18 i automated this i got back 15 what can i do with that 32 and then they say did you delegate anything you said i haven't done that yet okay do the delegate part oh i delegated eight percent okay i got you got 40 percent more of your hours back you're working 50 hours a week okay you got 20 hours yeah you know what there's that project we put on the uh not right now board do you want to do that

SPEAKER_176: one or do you have a creative idea and this is when your boss and the leadership of your company will fall in love with you or your investors will look at you and go wait these people keep producing more product getting more sales and they're more efficient and their revenue is going up but their costs are staying the same and they're getting to product they're getting to profitability quicker

SPEAKER_171: where they're increasing profitability uber has something like one percent less employees than

SPEAKER_176: they did two years ago during zurp they did the hiring freeze they did some layoffs same with facebook same with google at the same time those companies were growing 10 to 30 percent year over year that's why the stock market during this horrendous crash has been rewarding them spotify just laid off like 17 of their employees 1500 people stock went right up i bought facebook at 94 to share when zuckerberg laid off the first 10 000 people am i like a lunatic you know horrible human being for doing that i don't think so i was just looking at it saying they're bloated if they cut 10 of whatever you know 60 70 80 000 employees they're actually going to get more

SPEAKER_171: efficient and um because they're going to start with the bottom performance let's call it what it is you know and this is a competition for who's the most efficient if you ask everybody they got to cut 10 15 of their teams they're not cutting the top 50 percent of performers they're going to look at the bottom uh hopefully and cut the weakest folks which is healthy anyway right if you're gonna if you've got a basketball team no but if you cut a couple people from the team during training camp because they didn't put the effort in and you rewarded the people put the effort in you'd be like that's the right thing to do it's happening in corporate america right now so i want you to not be scared if you're hearing me say this because your bosses and the boards are all having this discussion they're having the add discussion automate deprecate delegate they're having that

SPEAKER_170: discussion without you include yourself in that discussion and be proactively doing it hey i found some place i can automate hey i found some stuff we should stop doing and we should redeploy for something that's high impact hey i have an idea of how to delegate this so we can do more so if we could delegate the clips of this week in startups to some other person and get it done and have it be just as good for a tenth of the price well then we could redeploy that in writing show notes or getting better guests inviting more people all of that good stuff right or editing the show better or doing graphics whatever there's going to be another function we can redeploy it to or adding another day of the week i want you to really think about this add framework it's in the show notes or you can go to calacanis.substack.com and sign up for my email newsletter there i hope this is helpful you know when i write these and i share my efficiency concepts with people whether it's the eod start of day end of day if you get anything out of this if it works let me know if you add anything to it let me

SPEAKER_176: know and if you want to take this edit it remix it and say hey i read jacal's post we had something similar we've adapted it and here's you know our new version of it go ahead post a blog post and pay it forward email me jason at calacanis.com for life and tell me what you did and i might retweet

SPEAKER_16: you if you add jason me or you dm me on x.com formerly known of twitter i'm x.com jason you can follow me on linkedin i publish stuff there let me know what you learned from this uh and tell me what i can learn from you because that's really what we're trying to do here in startup land i just want to end if you're thinking of starting a company i really want you to consider founder.university this is a program i run that's 12 weeks as free for founders we try to teach you how to start a company and we're looking for more people to start companies so we can invest in their companies when people come to founder.university they learn how to do a prototype grow their company build their team and we also invest 25 000 in about 30 or 40 of the companies every cohort we do the cohorts quarterly that we invest in so i'm really excited to get your feedback on this blog post this email newsletter i'm also hopeful that you start a company someday and when you do you consider having my firm launch which is at launch.co i hope you consider letting us invest in your company and we'll see you next time on this week in startups bye bye everybody