by Mike Dillard | Originally published Feb. 22, 2018

Today is a story about David vs Goliath…

But in our tale, David is a guy named Aaron Hinde, and a few years ago he decided to take on the Goliaths of the energy drink industry, Red Bull and Monster.

In 2009, Aaron and his business partner Orion hated the fact that they couldn’t find a healthy energy drink, so they decided to create their own.

Neither of them had been in the beverage industry before, and had no idea how to create one. They had almost no money, zero investors, and no distribution.

But that didn’t stop them.

A few Google searches and phone calls later, and they had their first can of LifeAid in their hands.

But creating the product was the easy part.

Getting it onto store shelves without a budget was the real challenge.

So they started thinking outside the box and skipped the grocery chains completely.

Instead, they went after one specific fitness niche and slowly but surely started to build a following…

Today, LifeAid will do over $30 million in net profits, and can be found on store shelves everywhere from Albertson’s to Whole Foods to GNC.

It is a truly inspiring story that contains an incredibly valuable marketing lesson for every startup…

 

Listen to the full podcast here:


Read the full podcast transcription below:

Mike Dillard:                      Hi, my name is Mike Dillard and this is Self Made Man, the podcast for those who want to leave their mark on the world and create a legacy of honor, integrity, and achievement in every aspect of your life. I'm glad you're here and once again it is time to forge your destiny.

Mike Dillard:                      Today is a story about David versus Goliath, but in our tale David is a guy named Aaron Hinde and a few years ago he decided to take on the Goliaths of the energy drink industry, Red Bull and Monster. Back in 2009 Aaron and his business partner Orion hated the fact that they could not find a healthy energy drink, so they decided to create their own. Now neither of them had been in the beverage industry before. They had no idea how to create one. They had almost no money, zero investors, and no distribution. But hell, that did not stop them. A few phone calls and Google searches later they had their first can of LifeAid in their hands.

Mike Dillard:                      But creating the product was the easy part. Getting it onto store shelves without a budget was the real challenge. So they started thinking outside the box and they skipped the grocery chains completely. Instead, they went after one specific fitness niche and slowly but surely started to build a following. Today LIFEAID will do over $30 million in net profits, that's got to be over 100 million in gross revenue, and it can be found in store shelves everywhere from Albertson's to Whole Foods to GNC.

Mike Dillard:                      It is a truly inspiring story that contains an incredibly valuable marketing lesson for every single startup out there, and speaking of David versus Goliath, the new selfmademan.com platform is now live. You guys have probably seen it already, and in many ways, we are pursuing the same strategy Aaron and Orion did to take on our much larger, more established competitors in the e-learning space, and that is by offering a superior quality product to a very specific group of people, namely you and the other amazing entrepreneurs out there who want to change the world.

Mike Dillard:                      If you haven't had a chance to see it yet, head to selfmademan.com and checkout the insane amount of value you'll get when you upgrade to a premium membership for just $19. For those of you who already have upgraded, thank you so much. You're what makes this possible. With that being said, please help me welcome Aaron Hinde.

Mike Dillard:                      Well Aaron Hinde, welcome to Self Made Man. I'm looking forward to our discussion today based on what you guys have accomplished. It's been absolutely amazing.

Aaron Hinde:                     Mike, thanks for having me on. Looking forward to it.

Mike Dillard:                      Absolutely brother. If those who are listening have been to at least a Whole Foods recently, and you've gone down the beverage aisle as I do almost on a daily basis looking for my caffeine fix, you've seen, you've probably seen a row of energy drinks, we'll say functional beverages called LIFEAID. Aaron, you're the founder of that company, and y'all just been growing like crazy, 50% a year for the last, gosh, seven or eight years now. You founded the company in 2011. That's awesome man.

Aaron Hinde:                     Yeah, it's been a great ride, great ride.

Mike Dillard:                      Absolutely. I've always had an interest in the functional beverage entity/energy market because I am always looking for a product that was really the same reasons you guys created LIFEAID, meaning I'm looking for my caffeine fix in the healthiest way possible, as little sugar possible that tastes good, that's not going to mess me up health wise, but that will provide me with an alternative to coffee because I've never been a really big coffee fan.

Mike Dillard:                      I know that's part of some of the inspiration why y'all started the beverage. But take everybody back to 2011 and dive into your story and the story of LIFEAID and why you started the company.

Aaron Hinde:                     Yeah, sure. I think Mark Twain's quote sums it up quite well, that all you need in life is ignorance and confidence and success was sure, and that's what we were full of back in 2011, a lot of ignorance and a lot of confidence, thinking that two young entrepreneurs with zero beverage experience could kind of take on the big boys and actually make a difference. If we knew what we knew now, it may be a different scenario back then, but I was a sports chiropractor here in Santa Cruz, California in this kind of the hippy capital of the world for those that aren't familiar with it. We've got a lot of cool brands that have come out of here, a lot of functional brands, a lot of food and beverage brands like Odwalla, Santa Cruz Organics, so on and so forth.

Aaron Hinde:                     Really I think the inspiration was I was coming down the beverage aisle at a local grocery store, and my young son at the time, he was just a couple years old, reached into an open-air cooler and grabbed an energy drink. And here I've spent 10 years of my life trying to get athletes off the energy drinks, telling them, "Look, this stuff's going to cause adrenal fatigue. It's high sugar. It's high caffeine. It's not a good way to over stimulate your body." And here my kid's reaching for one, and I'm going, "Geez, why is my kid reaching for that when you've got kombucha here, we've got chia, we've got all these more healthful alternatives?" The bottom line is the energy drinks are cool. They're cool, sexy, and hip. They appeal to the younger generation. The healthful drinks at the time were very hippie-dippie in nature. They weren't cool at all.

Aaron Hinde:                     My business partner was a certified financial planner here in town. We had this grand idea of like, look, we want to create a clean, healthy beverage company that was cool, sexy, and hip like the energy drinks, but unlike the energy drinks, they were actually good for you so you could kind of give a wink-wink to the moms out there that, hey, your kid may be reaching for this, but it's actually clean, it's low sugar, it doesn't have any of the artificial garbage, and we have some real good functional ingredients in there that can help aid with a particular vocation or lifestyle.

Mike Dillard:                      I love stories where an entrepreneur has an idea and a moment of inspiration for a product in a business that's in an industry they have zero experience in. I relate to that because that's what happened with me with EverGrow and my Hydroponic venture essentially to build that product. That's where you were when it came to creating your own beverage line. What did you do to actually get the ball rolling? How does somebody go from an idea into actual execution of that?

Aaron Hinde:                     Yeah, I mean, I had a little bit of past experience in the CPG space. I had a ...

Mike Dillard:                      Consumer product goods.

Aaron Hinde:                     Yes, exactly. I had a private label eye drop brand called Irie Eyes which I marketed to Stoners being here in Santa Cruz who were sold in like 2,000 head shops. So I had some experience there and had some lessons and kind of accurate thinking around that business. So when there was an opportunity to start this, it was literally on my business partner's birthday. We sat down in front of the computer. We had this idea of LIFEAID and this vision of these very niche products. We sat at the computer and registered 80 domain names in one night. We got golferaid.com for $12. Heck, we even got boneraid.com for $12 if you believe it or not, that was still available.

Aaron Hinde:                     I mean we went through, registered all the domains, and then just started doing some research, how do you create a beverage company, and started thinking about formulations and found the Flavor House in Southern California and kind of the rest is history.

Mike Dillard:                      I'd love to go through that process in a little bit of detail. You pick up the phone. You call these companies. Is that what you would google is flavor house, or is there a different name for that?

Aaron Hinde:                     Yeah, I know, it was Flavor House. I mean, there's a lot of different companies you have to kind of work with from can manufacturers, contract co-packers that actually do the filling, supplement manufacturers, so on and so forth. But for us kind of in the beginning is we took what we thought our formulations would be for these drinks down to a flavor house where they order very small quantities of the supplements and the preferred sweetener and then basically try to make it taste good.

Aaron Hinde:                     Interesting story right that first meeting at the Flavor House, we walk in, we're working with a brilliant food scientist, PhD food scientist. She looks at my formulation and the first thing she says to us is like, "Look, guys this formula looks great, but there's zero chance we're going to be able to make something taste good with this level of supplements in a can and keeping your sugar low and without using any artificial sweeteners." I remember we looked at her and said, "Well, we appreciate it, but I guess we're not at the right place," and we started to walk out the door. She says, "Whoa, whoa, let's give it a shot," and we kept working at it and working at it and I'm happy to say that the products have turned out really well.

Mike Dillard:                      How many iterations did you have to go through to get it to that perfect balance between taste and ingredient?

Aaron Hinde:                     I'd say now we can nail it in two or three, but at the very beginning even our first production run of our number one selling skew which is FitAid, a big recovery drink, I was embarrassed to even sample it to people, it tasted so fat. So I'm glad to say we've gotten a lot better at that process.

Mike Dillard:                      What next? You found your formulation company. Is it just a matter of okay this tastes good, let's order a batch? What does that process look like?

Aaron Hinde:                     Yeah, so next we have to find a can manufacturer. My business partner and I started this company with $30,000 each. When we started calling the big boy can manufacturers, the minimum on there is like 200,000 cans just to get cans printed on. What we heard there was something called silver bullets, which are these blank cans, which really, they don't have many up because these cans are made to order, so they produce the can and print them all as part of one run, but for some reason somebody might have some overage they didn't print on and you can actually occasionally find blank cans.

Aaron Hinde:                     So we call the West Coast rap for Wrexham, which is one of the big can manufacturers, and we actually get them on the phone. Just to give a little bit of background. The beverage industry has a 99% failure rate, so most of the people coming into this have hoop dreams or they're complete broke dicks, it's a one and done business at best, so that's probably his perspective as we're talking to him about this grandiose plan that we have. We ask them, it's like, "Hey, we can't afford the 200,000 cans, but do you have a pallet of these silver bullets lying around?" He's, "Look, look guys, no, I don't have any of those lying around, and it's not common that there's any overages, and when you're ready to actually step up and do a real run, let us know."

Mike Dillard:                      And the minimum was what? 200,000?

Aaron Hinde:                     200,000. Yeah.

Mike Dillard:                      What's the approximate price on that?

Aaron Hinde:                     It would have pretty much cleaned out our bank account at the time. That's when you add in the flavor house, and that's not even buying any of the ingredients that actually go in there or paying the co-packing fees.

Aaron Hinde:                     We're literally sitting there, we had this, all this excitement of the domain names registered, the flavor house picked out, and then we're like, "Oh crap, we're done. We can't afford the 200,000 cans." And I say, "You know what? Let's send," his name was Mike as well, "Let's send Mike a nice thank-you card," and in it we put $100 Ruth's Chris gift certificate. So, Mike, thanks for talking to us. Let us know if any silver bullets come up. Ruth's Chris.

Aaron Hinde:                     Well, guess what shows up a week later? We get an email. "Hey guys, I found a pallet of silver bullets." So we bought that one pallet of blank cans. We had them shrink sleeved, which is extremely expensive, cost about 30 cents a can just put a shrink sleeve. So instead of printing them on it, you put a plastic sheet basically with your label over the top. Then we talked to a co-packer, ended up doing a very short run for us. Our first run of product which was a GolferAid of all things cost us $3 a can, our cost, costing goods, and we went out and started selling golf courses product for $2 a can. But we knew the economics would work if we could get to some scale. We were just trying to get some proof of concept.

Mike Dillard:                      Wow. That really is at least it's my assumption that the trick to entering that 1% of successful beverage companies is distribution, right? Like anybody can come formulate a can and create a brand, but how do you get these products out there into the marketplace, especially because you're going up against some massive, massive really well-established companies who are in this same niche?

Aaron Hinde:                     Yeah, I mean most people when they in the beverage space or even in any really food product, the big goal is, okay, we want to get into Whole Foods, we want to get into 7-Eleven, and they're out pursuing those type of companies. What they don't realize is when someone goes into a convenience store, most people are in a convenience store for like 90 seconds, they know exactly what type of drink they're going for. It's not a place for trial.

Aaron Hinde:                     We started trying to get some grocery traction and failed miserably. We were running out of money very quickly and we looked at this and go, we can't compete against the big boys on their turf. There's no way. We don't have the marketing dollars. We don't have the brand recognition.

Aaron Hinde:                     So what we did is at the time we actually had three SKUs out, GolferAid, FitAid, and PartyAid, and it was almost like three different companies because we had three different websites, different social accounts, they're definitely different communities, different formulations, et cetera. We kind of looked at the business and said, "Okay, which one of these is kind of has the most potential," and we started selling direct to golf courses where we were getting some traction. We actually did about a half million bucks in our first year just selling to golf courses.

Aaron Hinde:                     But if we looked at FitAid, and FitAid specifically as a recovery drink in the CrossFit channel which is where we grew up in, my business partner and I met in a CrossFit a gym, and we saw the trajectory. The sell-in was easier. The sell-through was better. Our volume numbers were better. So we decided to put our chips all in to making FitAid a success, specifically in the CrossFit channel. Seven years ago if you went into a CrossFit gym, they didn't have any drinks. All they had was maybe a fridge with some waters they bought from Costco on the honor system people put $1 and then took a water.

Aaron Hinde:                     We started developing direct response marketing campaigns taking basically what all the info marketers were doing and applying it to beverages and selling online. I mean, for the first five years we didn't have one sales rep. We were doing $13 million with zero sales reps.

Mike Dillard:                      Wow. So were you all buying those little fridges and like setting them to CrossFit gyms with your beverages, or what did that look like?

Aaron Hinde:                     Yeah exactly. Our initial offer which is a lot sweeter now because we can afford to be sweeter knowing life-time value, but was basically purchase 10 cases of product, we're going to give you this free $400 fridge and we're going to give you a banner and POS and all that kind of stuff. And from HQ we just started sending those offers out. We'd send them out a snail mail four pack of samples, a nice written sales letter, some testimonials and a time-sensitive call to action, super old-school, and we started converting. I'll never forget that first month it's like, "Holy shit, we just got new 30 gyms this month." We used to ring the bell in the office every time a new account came on. Then the next month we got like 60. Then the month after 100. For a while we were churning like 250 new gyms a month. It was awesome.

Mike Dillard:                      How were you getting ahold of the contact information for all of these gyms?

Aaron Hinde:                     One at a time.

Mike Dillard:                      Oh really? Wow.

Aaron Hinde:                     Yeah, you had to basically go online. We paid somebody in Bangladesh to basically list build for us and go scour the internet and find out where the gyms were and what the mailing address was and who the contact was one at a time because it's a licensing model. It's not like we sold CrossFit HQ and therefore we're in all the gyms. We literally have gotten into 5,000 CrossFit gyms selling them one at a time.

Mike Dillard:                      Wow. So you guys definitely just kind of guerrilla marketed this thing and bootstrapped it. You started building up some momentum. Was there a moment in your business' development that really allowed you to start going vertical from a growth perspective and allow you to get into places like Whole Foods?

Aaron Hinde:                     Yeah, I mean, it all came to instead of pushing our way into accounts, we started getting pulled. The nice thing about CrossFit specifically is it's really affected all of fitness. If you're going to like the new Gold's Gyms, they have what's called Gold's fit which is basically CrossFit without the barbells. Look at the success of Orangetheory. We started getting pulled into other gym chains. I know you've had Bedros on the show, Fit Body Boot Camp. We started getting pulled into all these different gym chains. So the FitAid line specifically started becoming like the go to recovery drink and functional fitness that led to a partnership with Spartan Race.

Aaron Hinde:                     We started handing out ice-cold cans right when people needed it most, right when they finished a grueling Spartan Race. Well, the buyers at all these major retailers happened to be running Spartan races, or happened to be training at a CrossFit a gym or a Gold's Gym and seeing our product and then calling us, saying, "Hey, we really want to get this in," and we would just say, "Look, we don't have the marketing budget for slotting fees and all of this." "No," like, "that's okay. We're going to bring you in. We know you're a small company." Then we would just prove ourselves out on a usually a very regional level, which led to global authorizations.

Aaron Hinde:                     A great example is Whole Foods where the buyer at the time in the Rocky Mountain region was kind of Utah, Colorado was an avid crossfitter. We were sold at his gym. He brought us in one day before the window closed on new products. We got this call from a Whole Foods buyer and we got him out everything they needed in one day. They put us in the sets. We sold like gangbusters. He got promoted to corporate, brought us in into a global rollout and that relationship has been great, which led to us closing Sprouts nationwide and Vitamin Shoppe, GNC, and so on and so forth.

Mike Dillard:                      Awesome. You guys are growing like crazy. You've got some huge competitors out there, Monster, Red Bull, et cetera. How have they taken to your success?

Aaron Hinde:                     Well, early on we took a couple of bumps and bruises from the big boys. The first was with our GolferAid line. I had this great idea like, "Hey, we're in the Monterey Bay. We're real close to Monterey and Carmel," which Pebble Beach is at. We went down to Pebble Beach and got a P.O. box. In Pebble Beach they have their own post office, and we started doing all of our GolferAid mailings out of there, and so we put Pebble Beach on the can.

Aaron Hinde:                     Our first cease and desist we got from Pebble Beach Corporation saying, "Hey, you can't use Pebble Beach on the can," which we had already printed these couple of hundred thousand cans, so that was always a challenge. Then shortly after that we get a cease and desist from Pepsi saying one of our lines that we hadn't even come out with yet but we had approval from the trademark office which was [GamerAid 00:19:08] which was they said was too close to Gatorade and therefore put a cease and desist on that.

Aaron Hinde:                     It's always a little scary as a young bootstrapping company to get official letters from some of these big players.

Mike Dillard:                      Did you guys say, "Oh, okay, it's not worth the fight," because to me that's like so unrelated, it's not even funny. It's two completely different industries.

Aaron Hinde:                     Yeah, and the trademark office sided with us. They gave us the trademark. We called our attorneys, they're like, "Yeah, we can win this, but it's going to cost you 200,000."

Mike Dillard:                      Oh, I see.

Aaron Hinde:                     But when you have 20,000 in the bank account that's just not a reality.

Mike Dillard:                      Got it. That makes sense. Yeah, interesting. The legal process is not necessarily about who's right. It's who can afford to go through it and finish it, which is interesting. Have you guys ever raised around?

Aaron Hinde:                     Yeah. Last year we raised around from a private equity group KarpRiley in the East Coast. They're just great partners, very entrepreneur friendly, long timelines. They've got a lot of experience in restaurants and other consumer package goods. They've got a great reputation in beverage, so we couldn't be happier with that partnership. That's allowed us the capital to really scale into some of these bigger accounts like Kroger and Safeway.

Mike Dillard:                      I was going to ask you what the use of funds would be for you guys if you're seeming to do it quite well on your own, if there's a particular area you wanted to deploy it in?

Aaron Hinde:                     Yeah, I mean it's mainly been for human capital. We went last year we brought on like 35 new team members, quite a few on the sales side of things. Once you do, it takes ... it does take feet on the street to have the meetings and land some of these bigger corporate accounts. We did a great job from headquarter managing the online business, direct to consumer, and direct to gym business, direct to golf course business. But as we got into the bigger retailers, those relationships needed to be managed. We needed to make sure ...

Aaron Hinde:                     There's so many things that can go wrong on retail from dented cans are the kiss of death. You could have a couple dented cans sitting on the shelf and affect your volume because nobody's going to buy a dented can. So you literally have to have feet on the street going into the accounts, developing relationships with the store managers, managing promotional calendars, making sure there's no dented cans, setting up displays, point-of-sale, all kinds of stuff. We've really, that private equity round has allowed us to beef up that sale side of the business and really start to scale.

Mike Dillard:                      Awesome. What's your personal goal for the company in the next 5 to 10 years? Are you looking at being acquired at some point? Is that your goal? Or are you just, "Man, I'm having a blast, I'm going to do this as long as I can"? What are you thinking?

Aaron Hinde:                     Yeah, I mean we're having a good time. We've got a great team assembled. We all really enjoy working together. One of our core kind of tenets is work hard, play hard, and we definitely practice that on a daily basis.

Aaron Hinde:                     Yeah, I mean there's people out there that have definitely knocked on the door and looked at us as an acquisition target. But let's face it, a lot of the big boys when they buy you, they kind of bastardize the band and strip down the efficacy. That's not what we're all about. We want to change consumers expectations and hold the big boys accountable for what they're putting out, because I've got two kids. Let's face it. They've gotten a free pass in my opinion from way too for poisoning our kids with sugar water and garbage ingredients. I'd prefer to keep it tight, keep it lean, continue to run a profitable company, and who knows, maybe we'll IPO down the road.

Mike Dillard:                      Can you talk about some of the common ingredients found in those mainstream brands that are particularly harmful, and why people should not be consuming that?

Aaron Hinde:                     Yeah, I mean well the most obvious is sugar. I mean, sugar's been demonized quite a bit rightfully so today. It's not that sugar or carbohydrates are evil in and of themselves, but the excess that they're consumed, especially in this country, is totally out of control, it's causing chronic inflammation with people, diabetes, and a lot of other chronic diseases as a result of the inflammation.

Aaron Hinde:                     Next I'd look at jacking your body up on too much caffeine. I do enjoy coffee and I'm not anti caffeine, but it's crazy. I see some people are drinking four, five, six cups a day or drinking ... young kids drinking three energy drinks a day, and it's like, "Wow, that's a lot of artificial stimulus just to get your body going in the morning."

Aaron Hinde:                     Then the artificial sweeteners I think have been rightly demonized as well. So you got less people using sucralose and aspartame, and looking for more cleaner, functional beverages that don't have the sugar or the artificials in them.

Mike Dillard:                      Yeah, I mean you just look at the sugar-free versions of that, where people are like, "Oh, there's no sugar, I'm good," but man, the ingredients in those things are just horrific if you do your research on them.

Aaron Hinde:                     Yeah, especially the dyes too. Look at them. I mean, start doing research on all the different dyes, the blues and the reds. I mean, that stuff is toxic. I'm all about eating clean it is one area that I do not skimp on, grass-fed organic. It's like food is the primary drug we give our bodies on a daily basis, and we've got to really pay attention to what we're putting into our body because it has a direct reflect in how we perform, whether we're an athlete or you are an entrepreneur, it's we're always in performance mode. If you're having performance issues or midday fatigue, you got to look at your diet and go, "Okay, what's going on here with my body?"

Mike Dillard:                      We've got obviously a huge audience of entrepreneurs who are listening to this right now. What's your biggest piece of advice or lessons learned over the last seven years as you've gone from nothing to 30 million I think what a net this year?

Aaron Hinde:                     Yeah.

Mike Dillard:                      Which is just massive. What are those key moments and obstacles that you've overcome that have allowed you to do that successfully?

Aaron Hinde:                     There's been so many. I mean, I mentioned accurate thinking earlier, but I see a lot of entrepreneurs, especially with physical goods that they're just not thinking accurately about either the timing or the ingredients and the makeup or the market or the marketing, not putting enough attention into that. But I think my biggest lesson over the last seven years, I like to go back to a quote from Henry Ford, he says, "If everyone is moving forward together, success will take care of itself." What that means to me is it's an alignment issue. If you want to scale a business, you have to have alignment.

Aaron Hinde:                     Like me and my business partner have to be perfectly aligned most of the time, and that took some time. It's almost like a marriage. It took some time to get that alignment and to kind of divvy up who's in charge of what aspects of the business, having our team completely aligned on what is our goal.

Aaron Hinde:                     We want to be the next billion dollar beverage brand. We've said that since day one, probably way too early we started saying that. So how do we get there? We get there by executing on a weekly basis. I think you've had Vern Harnish on this show. We utilized a lot of those Rockefeller habits and gamifying quarterly goals to make sure we're getting our team and each department in complete alignment on what we need to accomplish in this three-month window in order to hit our annual goal, in order to become that next billion-dollar brand.

Mike Dillard:                      Can you give us an example on how you gamify your goals?

Aaron Hinde:                     Yeah. We have one kind of down week at the beginning of each quarter. It's not really a down week, but it's an opportunity to reflect on the previous quarter, see what we've accomplished as far as our objectives and key results, our OKRs which some of our KPIs are tied in.

Aaron Hinde:                     Each individual at this company every quarter has two or three or four objectives that they are going to accomplish personally that contributes to their team's quarterly goal, and then they have one or two personal goals. Because we know that life is life. There's no work life and personal life. It's all life. If you're having a fight with your wife at home, it affects work. If work's burning you out, it affects home. We want to make sure everyone's moving together in unison and that everything's really balanced out, so we're looking at a few work OKRs and a couple personal. Those tie into the department, so what the department needs to achieve as an aggregate.

Aaron Hinde:                     Then what we do is we create a forward-looking vision statement, so at the beginning of our team meeting, which is every Tuesday, someone in the team reads the forward-looking vision statement as if we've already accomplished everything that each department has laid out for that quarter, okay. Then once we achieve at the end of the quarter and then every department head chimes in every week, we're at 15% completion, we're at 30% completion, and we always give a hard time to those that are lagging a little bit and obviously praise those that are ahead of the game, and if we hit 80% achievement or better at the end of the quarter, we do something really fun for the entire team. Like we rented out the Chardonnay sailboat out of Santa Cruz and we had a big booze cruise out on the bay, or we'll do something that's an activity, get everyone out of the office that's really fun.

Aaron Hinde:                     Additionally, each individual at this company is bonused at the end of the year a percentage of their salary based on the completion rate of their individual quarters. We add up the four quarter completion rates and that ties into their bonus. They're very personally incentivized from a financial perspective and then we're incentivized in an aggregate sense by some type of a reward at the end of the quarter.

Mike Dillard:                      You mentioned Vern. I was going to ask you, is there a particular person or group that you guys have learned from and pursued when it comes to acquiring your business education? Because there's two different primary skill sets in building a business. They're selling your product and your service, and there's actually building a company. They're very different skill sets. Have you pursued an education on the business side of things from a specific person or group?

Aaron Hinde:                     Yeah. When we were really struggling and we're running out of money, one of my mentors who was actually my mentor when I was a chiropractor who's a brilliant marketer Ben Altadonna, he reached out to me and he said, "Hey, I'm a member of this marketing group. There's a lot of smart people in there. I think you'd get a ton of value. It's not cheap. It's 25 grand. I know you don't have the money. I'll loan you the money. Don't worry about it. Pay me back when you can." I'm thinking, "Ben's successful. He's somebody that I look to. He's never led me astray." I said, "Okay."

Aaron Hinde:                     He'd loan me the money. I showed up at Genius Network, and just started chatting with everybody and absorbing everything that I possibly could from how to run business to scaling to business and marketing and everything. I started to get a lot of clarity and then I just started diving in the books. I'm going through like a book a week for years just absorbing, absorbing, absorbing content, and then trying to implement as much as possible.

Aaron Hinde:                     So a lot of it was trial and error, a lot of it was having really great mentors, and then just the free information that's available, and what are you going to spend five bucks, 10 bucks, 20 bucks on a book, free podcasts. I mean, it's all out there. I think now what I really try to do is manage my information so I don't get total information overload on, okay, what am I trying to achieve this quarter and what information resources are really going to help me get from point A to B.

Mike Dillard:                      Yeah, absolutely. When it comes to hiring, is that something you guys have just pursued on your own and do internally? Do you use a recruiting firm? How do you all go about that?

Aaron Hinde:                     The nice thing is we understood from a very early stage that the value of our business is in our list. So we've been list building aggressively. On our email lists we have over 200,000 people now. At social media we're at like 450,000, [inaudible 00:31:31] with our FitAid Instagram being our biggest at I think 182, something like that. When we have positions available, we send an email blast out to our list, we do a post on social media. I remember for one sales position we posted, we got a thousand applicants.

Aaron Hinde:                     So what we do is we run everybody through [Top Grader 00:31:50]. If you haven't heard of Top Grader, you should check it out. It's a great resource to get rid of the deadbeats and help you kind of screen through who the créme are, and from there we will identify say our top 10 candidates and do 10 phone interviews and then bring five people in for in-person interviews. Usually all five of those people are extremely qualified for what we're looking for from a skills' perspective, and from there we're really just looking at the right cultural fit.

Mike Dillard:                      Very cool, very cool. Yeah, and this has been such a cool story. I really love it when you get to start with an entrepreneur at the very beginning, and like I mentioned earlier, especially when you start at a brand new industry that's new to you, because it's one thing if you're just following your natural evolution, but for you guys to jump into such a competitive high startup cost industry and make it work has just been great. I think the key to your success is the fact that you pursued a really, really, really specific customer niche, specifically CrossFit, golfers-

Aaron Hinde:                     100%.

Mike Dillard:                      But that's it. Yeah, I think folks are like, "I just need to make a great quality product with a really cool logo and put it on the shelf and that's it," they're going to fail, right?

Aaron Hinde:                     A lot of people talk about going deep in a niche. I would say the one caveat to that is you have to be part of that niche as well. The reason we were successful in CrossFit is because we CrossFit ourselves. So when we're going to the shows, there's a certain look that a crossfitter has, there's a certain dress that a crossfitter has. We're successful with PartyAid at Burning Man it's because I'm a burner, my business partner is a DJ. When you're looking at a niche, don't just go, "Oh, that's an underserved niche. I'm going to go for it." Make sure you're immersing yourself in that niche, become part of that community because the authenticity shines through in the products as well.

Mike Dillard:                      Yeah, it's not going to work well if you're selling this beverage and you're 50 pounds overweight, right?

Aaron Hinde:                     Exactly, exactly.

Mike Dillard:                      Yeah, without a doubt, agreed. Well, Aaron this has been awesome brother. Any final words of wisdom or resources that you guys have found recently that have just kind of changed the game for you?

Aaron Hinde:                     From a resource perspective we use a lot of different resources, a lot of reporting. Slack has just been a great tool just for internal communication and to get all the back-and-forth with email out of the way. So if you're not using Slack, it's free to a certain point, check that out.

Aaron Hinde:                     There's a company here in Santa Cruz if you want to get real sophisticated on your reporting and looking at all types of different metrics called Looker. It's been an incredible resource for giving me my daily dashboards, at looking at every aspect that I want to monitor that I'm in charge of the business and looking at how variables are affecting sales and conversions and leads and so forth. So Looker's been a great resource.

Aaron Hinde:                     Then I would just say from a very human perspective, I look at why have we been successful in our space, why are we getting traction. Our products are great. We're from those communities, but really when it comes down to it with all the technology that's available and everything, this is still a relationship game. And business is all about relationships. So treat people well, treat people how you would want to be treated. As someone told me, "The people that you meet on the way up are the same people you meet on the way down," so you never know who you're talking to. Just approach life as such and treat people well and I think that good karma always comes back around.

Mike Dillard:                      Yeah, agreed, agreed, agreed. Well, Aaron, thank you so much. This has been just a fantastic story and a lot of valuable lessons learned in there for entrepreneurs who are just getting started. Where can folks go to buy some LIFEAID?

Aaron Hinde:                     Well, they could always check out our website, lifeaidbevco A-I-D becvo.com, or check us out at your local retailer. I mean we're in all the Whole Foods, all the Sprouts, HAB, down in your neck of the woods in Texas, multiple Safeway divisions, Kroger divisions, Vitamin Shoppe, GNC, so on and so forth. So check us out if you're looking for a clean, healthy alternative.

Mike Dillard:                      Awesome. Aaron, thank you so much. Guys, gals, thanks for listening as always and we'll see you next week. Take care.


You can follow Aaron Hinde on Instagram: @AaronHinde

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