Ecommerce: Building an Ecom Holding Co That'll Do Mid to High 7 Figures in Year 1 With James Camp

So yeah, after I sold the company last year, I was trying to figure out what I wanted to do, was consulting a lot of brands, realized that almost everything I'd started from scratch failed and decided just go to buy companies. And the first acquisition with like a month of work will top line at least 5 million this year and just off the first acquisition, right? And EBITDA probably 800K plus. Wow. All right. We need to dive into this, but who the heck are you? I'm James Camp, sort of serial entrepreneur, internet marketing kid, who sort of straddles the line between this like mini private equity M&A world and the online just click clacking on a keyboard internet marketing world. I love that. So you sold your company last year. How did you know you wanted to build a holding company and how the heck did you find this brand? Walk me through the entire thing. I'm fascinated. Sure. So first of all, I don't want to get into like two exact specific things, but like super, super shout out to my partner who was the brand owner of the first company we acquired and sort of hopped on board with this ridiculous vision I had of building this e-commerce holding this company and getting to a hundred million in revenue through acquisitions as opposed to through ad spend. And yeah, I mean, honestly through Twitter, and this is so people ask me often, like, why am I going so hard on Twitter? And candidly, like, yeah, it's good. You know, I have a course, I do some consulting, it's good walking around money and I'll never complain about that. And I actually love doing it. A, B, it's just so gamified. There's such a huge dopamine hit. I'm incredibly competitive. And like, I see people like you just like crushing me on Twitter every day and I want to go out and grow faster. But C most importantly is that I live this real life outside of Twitter that includes now currently running a small e-commerce company. That's a rollup. And the deal flow that I get is from Twitter. It's in DMs and stuff. And I can tell you that if you talk to anyone in the sort of PE world, for lack of a better term, the phrase that gets private equity guys hard is proprietary deal flow. And I can tell you, I'm incredibly lucky to have real proprietary deal flow that does not come through a broker. So that's why, I mean, that's how the company started and that's why I love it so much, but yeah, sold the company last year, realized I wasn't sure I wanted to build much from scratch ever again and watched rollups happen and was very involved with a lot of investment banking guys and watched a lot of rollups happen. And I thought I could do this. And I sort of have this, sometimes it's hubris and it screws me, but very often it benefits me just this belief that I can do anything in the world. So I was like, you know what? Let me, Thrasio wants FBA brands. Let me go scoop up Shopify brands. So that's been- I love that, man. Everything about this is fascinating to me, but for you, what do you think the most interesting pieces that you want to talk about? Is it how you secured financing? Is it how you vetted and audited the deal? Is it building the team to kind of scale it? What's the most interesting piece of this that you can kind of share? So I think that probably what's most interesting to me is not most interesting to many people. I'm not a phenomenal operator. So like for me, it's like trying to figure out how to not just make the operations happen, but make sure the people that come on board with me are phenomenal at operations. I had this like sort of epiphany last year, which was that like to stop fighting the grain, going against the grain and trying to like force myself to do things I was bad at. And operations was one of those things. So like my partner is phenomenal operations. And the trick is sort of just bringing in really, really- people say hire great people. Like I just want to bring- partner with really great entrepreneurs that are good at things other than me. I'm really good at just seeing the puzzle pieces from 30,000 feet up. This people think is probably more fun, is like how do we like crush OpEx, like make things more efficient without changing the businesses, right? So it's like for me, it's just fascinating that I could take these five businesses and without making any of them any better, without growing any of them, if we brought them all in house, that like we can end up saving, you know, 50 plus thousand dollars a month just by using what's called like a shared services model and not paying guys and agencies like you, you know, to outsource our work, right? Which makes sense for a single brand owner, right? But if we've got like five or six agencies, five or six brands in house, like I'm not going to be paying $35,000 a month to media buyers, right? I'm just going to hire media buyers and pay them on salary, right? So we sort of end up having like an internal agency of sorts. In fact, I've thought about just buying an agency and housing those internally as well. Dude, that's awesome. So you're at one brand right now or you're at five right now? No, we're at one brand right now. We just closed like two or three months ago. There's two more that we're due diligence in currently. One of them is, I don't want to say what it is, it's super definitely proprietary deal flow. It's sick. I love the brand. I love the owner. He's just amazing. He's 19 years old, blew something up way beyond anything he ever thought he could be able to manage. And it's growing super fast. We're actually going to, what we've realized is that like buying other brands doesn't negate actually growing brands. And when I say I don't want to start anything from scratch, that's true. But one thing we're going to do is actually launch a like sister brand using the customer data from the first brand that we have. And that's something we're looking at doing right now because we get a couple thousand new customers every single month with a relatively high AOV. We know what they like. We've got CSRs like customer service reps who are actually talking to people on the phone. So using email as the sort of launchpad here is we're ideating a sort of sister brand now, and then we'll start cross-selling through email for free traffic. And then we'll start doing some retargeting. And I'm pretty confident that this new brand that will go alongside of it will do, I mean, I would think would be low six figures pretty easily just because of the amount of overflow that we have. Yeah, it makes sense. So it sounds like one kind of obvious area opportunity is when you get to all the five brands kind of slashing costs through being more efficient. And it kind of sounds like the second one is through your background, through the partner's background, through other people's backgrounds, being able to scale the business. So is that kind of number two is being able to see opportunities to scale paid spend or scaled other opportunities that they're not currently doing? That's the next big kind of opportunity? Well, I think the one thing I look at, and not just me, but like the whole team looks at is I'm like a jack of all trades, master of none. Everyone says that. The truth is it's actually really crappy in the long run. Like the way that you grow is like to be really specific and be good at one thing. Because I've managed to survive that for 33 years, I've gotten, I've seen a lot of different things. And what I'm realizing, and this is like almost a trope at this point, but then a lot of CPG brands, everyone's so like Silicon Valley and venture backed startups are so big these days that everyone's like really focused on brand. And I don't want to forget brands, it's really important. But there's like a lot of opportunity, I think, in looking at like the direct response and for product world space and the way that we sort of build funnels and like actually try and get somebody to convert. My background is really affiliate marketing from like a long, long time ago. And I have the most respect for my affiliate marketing friends because they managed to get profitable only on the front end ever. There is no backend, it's for a small commission and campaigns die and things die. So I think it's a really good opportunity to take these brands that actually have a bit of brand equity and value in that and actually make funnels and marketing towards this direct response, much more, slightly more aggressive copy to try and get people to convert more quickly. And so that's where I think there's a major opportunity. I've got a friend who I won't say what it is, is CDO and a partner in a pretty large venture backed sneaker company that I'm sure most people know. And we were looking at their numbers last time I was staying with him and they were spending more on their CPA than their AOV. And raising another like eight figure round at the same time. And we're not talking about a SaaS, we're talking about sneakers. So I think that if that brand used really direct response tactics, I think they would print money. They're different. When I buy a pair of vans, I don't need to see an ad for a pair of vans to go buy them. That's what their goal is. And the investors who write them eight figure checks goal is as well. Trey Lockerbie. Yeah. That's so interesting. To me, it seems so backwards and I think more like you really scrappy. One thing I want to talk about is let's talk about the numbers and not your numbers, but when you're looking at a deal, is there a certain revenue and EBITDA range that you're looking at that's kind of a sweet spot? What are some of the multiples that people are paying to swell up and acquire these brands? I think that kind of stuff is eye-opening and interesting. Sure. So for me, EBITDA, I use the term EBITDA all the time, even though I think that on the smaller side, EBITDA is sort of not even a true metric. It's more like SDE, seller's discretionary earnings. And that's because every brand owner that makes 400K will tell you that they did $400,000 in EBITDA and it's just not true. They did $400,000 in seller's discretionary earnings and they did a member draw from the balance sheet and paid themselves out on a K1 probably, that 400K. So for me, when we're looking at EBITDA, I want to see, for us, just in the check size that we have access to, it's more like the 500K to just over a million range. There's a brand that's in the 2.5 plus that we're looking at and that's where I'm just not sure we're going to wrap our arms around it. But that's important to me because I don't want to buy a job. I'm not trying to buy myself a job here. I'm trying to consolidate brands and crush OPEX by using the shared services model. So if you made 200 grand last year and have a great brand, but you did the media buying and ran the brand yourself, that's $0 in EBITDA, right? Because I would have to literally replace you tomorrow and replace with a manager and a media buying team. And so for us, it really needs to be 500K, I feel like is the number in which it's very clear that I can just replace you with someone that's a great operator and gets this. But that's sort of 500,000 plus is really where we're looking at. And then I think in terms of some other metrics that I find interesting is we're trying to find like 70 plus percent margin products. People will say, what are you talking about? How is that possible? There's a ton out there. For us, I want to be, again, because I come from the affiliate marketing background, I want to be profitable on the front end. So I just know AOVs of 50 plus with a 70 plus percent margin product really are these metrics that allow us to actually grow and stay profitable on the front end. All beauty is in that range. All supplements are in that range. There's a lot of stuff in that range. But yeah, AOVs over 50, 70 plus percent gross margins. And then if we can add, I mean, I'll tell you one thing we're working on, which is cool. If we can figure out a way to create more LTV, we are, without giving the exact example, we are creating a membership backend for customers, where for $20 a month, they get a membership. And you can decide what goes into that membership, plus its discounts and replacement guarantees, et cetera, et cetera. But that adds, you know, MRR and ARR to the business. And so that drastically changes our LTV, right, by having that happen. Yeah, dude, that's huge. And then one more thing on the financing side, when you're raising financing, how important is it, you know, your particular background, your business model, or actually the business that you're buying? How much of those weight goes towards each one? Your personal background is, you know, everything that you've done, your partner's done, the actual business that you're buying, or kind of the business model that you're doing, you know, aka kind of like the Thrasp model for Shopify. Sure. So I think that ironically, the bigger you go, you know, the more you just have to understand like the big, big metrics, and you have less understanding of the actual minutiae of the business. So like, some of our board members are CFOs and COOs of like multi-billion dollar consumer packaged goods brands. They won't even look inside the Shopify with me when I get added Shopify access, right? They have no interest in it, right? They want to look at balance sheets and income statements, right? And P&Ls. That's all they give a crap about looking at. And I don't think that any of them have any actual understanding of how brands work. And in fact, I fight them a bit, because we'll look at things, they'll say, how come 50% of the revenue is being spent on marketing? When it's like, well, because these are small private label brands that are growing, right? These are not like super viral, you know, super unique things. But so to circle that back is that I don't, I don't feel a deep need to be incredibly connected to the understanding of the industry that the brand is in. With that said, I wouldn't buy something that was like wildly complex and I have could never wrap my head around. I think for the lenders really don't care. I mean, as long as you know, the lenders want to know, do I have a background in e-commerce and do I have a background in internet marketing? Do I think that that might change at different levels? For sure. Like I know people that are taking SBA loans, that's very predicated on, do you have a background in this space? Can you make it happen? I think in our range, which is like the small MES debt fund stuff and small private lenders, not so immensely, I think when it gets really big again, I can't imagine that if Ziegler's underwriting a $300 million bond, that they're like super hyper worried about like what that CEO's specific industry experiences as much as like they're underwriting the asset. So it's not super important, I guess, if that makes sense. Yeah, no, no, absolutely. So you mentioned before, five brands, consolidation, saving tens of thousands of dollars a month just through consolidation of services, obviously scaling revenues and profitability. Say you're at all five, you're in it a couple of years. What's the ultimate goal? Is it to sell and get acquired? Is it to buy another five brands? So I think for me, I've always had a pretty short view on things. Like I've tried to like sort of be in and out and say, I've got three to five years of run rate in me. I'm not sure that's true. I don't really want to, the goal is to sort of just grow it to be $100 million in revenue. What comes next comes next. I think that candidly, if you're really running, if you're at a hundred million top line, spitting off like $15 million in EBITDA, that your options are sort of limitless in terms of whatever you want to do. You're big enough to do a small go public transaction onto the NASDAQ capital markets or NASDAQ Americans or smaller tiers of the big board exchanges. Definitely plenty of private PE firms and family offices that will happily just, at that point, you're not really running it at all, right? Your whole team is running it. That will happily just suck up the distributions. I don't know. I'd like to think that I would probably like to take a break again, but who knows? I love this. So it's like, if I really get to a hundred million dollars in the next four or five years, which is sort of the goal, then damn, I mean, why not a billion, right? I mean, it really, I think that's where the numbers become easier. If you're doing a hundred million top line, borrowing $15 million to buy a brand is nothing, right? They're happy to give it to you because you're getting 15 million EBITDA each year, right? You can service the whole debt with the company's profits in 12 months. So the goal is to make it so that the options are limitless as to the exit strategy. I talk about flipping a lot. People are like, are you flipping sites anymore? And it's like, well, yeah, but I don't call it flipping. I would like to get an exit on these one day. When worst comes to worst, cry me a river. If not, then me and my partners will just take our $15 million in dividends every year spread apart and figure out what's next. That's awesome. I want to now shift gears. Let's talk about Twitter. How long have you been on Twitter? What type of things do you talk about? How often do you post? Like what have been the keys to growth? I just want to talk about Twitter. Yeah. So I think I joined Twitter in 2011. I'm 33. So I cannot imagine the horrific stuff I was tweeting and how stupid, like I have to go back at some point and clear it all out. I mean, I'm never going to run for office or anything, but I'm sure there's some stuff in there that would haunt me one day. I sort of started to rediscover Twitter a little bit in the beginning of last year as we were like unwinding our old company and I knew that I was just looking for stuff to do. And then COVID hit and I was just like sitting in the house. I think I started really taking Twitter seriously in like September, October of 2020. I made one thread about, I flipped some websites in my life, a good chunk of websites in my life. And I always am talking about, I'm always running cases on businesses with my friends, sort of like my first million just like, Oh, if we did this and this and this and this. And I, my friend was like, just turn into a thread. So I turned into a thread and I got 1400 followers in a day. And I think at that time I had like 1200 followers. So it was like a massive explosion for me. I immediately became addicted to the dopamine hit. Like pretty clearly anyone that says they're not, it's just lying to you. And I've slowly ramped up the seriousness I've taken it at up until now. And I really sort of hit and I was trying to not take it too seriously for a while. I kept being like, Oh, whatever it's Twitter, you know, like, and I've now been averaging like 30 to 3,300 followers a month. And like, I know, I now understand the mechanics of growth there. I think I could really do four or $5,000 a month pretty aggressively if I really wanted to. And so I'm going to start taking it more seriously, but in a more controlled way, I'm on my phone an absurd amount of time. Anyway, I would be horrified to look at my screen time for Twitter. And I don't want to necessarily make it less, but I don't want any more cognizant of how it's happening. Right? Like I do use hype I recognize there's some value in this. But yeah, I mean, I tell everyone about all this stuff. It's like I could teach anyone the science of it. You're just as good or better Twitter than I am. You joined Twitter after me and you're 10,000 followers past me, right? Like you and I could probably write down the science of how to grow on Twitter. But that's like 80% of the game. The magic is that 20% that is like, are you interesting? Do you actually know useful things to people? And also, is this the channel that wants to consume your content? Right. And it happens to be when we were kids, I'm 33. It was like forums. It was like wicked fire and blackout world and all these things. And that has all died off. And so I think that like the new home for internet marketing is, is Twitter. And so it's just very lucky, I think for people like us. That's awesome. Yeah. I mean, I'm, I'm addicted to, I think I've been on it for a little over a year and it's, it's so fun. The number of doors that it unlocks is just insane. I think it's one of the best things I've ever done. So for, for you, what are some of the topics that you, you talk about and then what's the people that follow you? Like, what is your, obviously your goal is to provide value, right? That, that part's transparent. You do a really good job about that. What is the goal then from there is to get them to subscribe on YouTube, subscribe to your newsletter, go into a course. So what does that look like? So the topics I talk about are, I mean, I think everyone knows me for website flipping, which is like sort of funny. And this is like, this is just a lesson in life is that like, you don't get to decide who you are. Cause I would not have necessarily chosen the website flipping guy as like, as like my avatar, like who I am, like granted, I've done a bunch of it, but it's like, it's not, you know, it's, it's I mean, it fits into what I do anyway. Right. So it's useful, but so website flipping is my main topic. Then I think followed by like, so because I come from the old school, like black hat, like black hat world now, and not to give too many shout outs to this forum, but there's really a lot of like SEO spam stuff. But like when I was a kid, I was a moderator on the forum and I was like 17 and all it was, was like people talking about ways to make money online, like very specific, exact methods. And I think those are some of my threads that have really blown up or like, here's how anyone can make $10,000 this weekend. Right. You know? And like, they're just like super specific, exact methods. So I like to try and show people beyond just like selling services, which is, or like starting an agency, which is like the standard, how to make money on the internet things. I like to show people like tangible ways, like side hustles from the make cash. And then I like to talk about website flipping, like M and A website flipping. And then candidly, there's like probably like 50% of it's just platitude bullcrap, but it's like, sort of just, I actually am sort of saying to myself, right? Like there's sort of like affirmations to remind myself, like, this is how the world works. Right. And so it's sort of like filler content around the real nuggets. And part of that sort of keeping the engagement up with the algo, right? Like I, I generally, you know, I'm not a big, I'm not a huge email guy like, like you, but I've definitely been around long enough to watch what happened. Someone asked me yesterday, I got a list of like a hundred thousand subscribers. I haven't emailed them in three years. What do you think it's worth? And I said, zero. I literally was like, I think it's worth $0. Right. And that I think is probably true with social channels as well. Right. Like, you know, if you all of a sudden let it all die off, I hate to say it, but once, once the machine is moving, you got to feed the beast. Like you just have to keep it going on some level. Otherwise I think not just the people get tired of hearing from you, but algorithmically, I think the algo just takes you out of its favor. And I don't know exactly how that works, but that's my guess. Dude. Yeah. A hundred percent. I try to post, you know, obviously as much as I can, but I try to post like three to five times a day. If I have something relevant to say, how often are you tweeting a day? What'd you say? So I think it's three to five times a day. All you got to do is go into social blade and you'll see how many tweets you actually sent out. And like, I'll hit like 15 a day sometimes. Now that includes replies in all fairness. Right. I'm definitely not tweeting 50 original ideas a day, but one thing I make sure to do is I would be flabbergasted if someone could say that they've replied on any tweet I've ever tweeted in where I did not reply to their reply. Right. And so like, that's like one of those like little lecture things I think makes a massive difference in community building and probably algorithmically. So I'd say, you know, this week I was moving. I made sure to like log in and tweet like one tweet a day. You know, I didn't get to really reply to people much except for like an emoji reply or something. But in general, like I try and do two real tweets a day, like thought out, like planning content. And then the rest is just like off the cuff or replying to people. But I'm always flabbergasted when I go on social blade and it says like, Oh, you tweeted 84 times yesterday. And I'm like, Oh my God, like what is, what am I doing my life? But then I realized some of it's just like totally, man, you're right. You know what I mean? Like it's that they're counting all the replies as well. Yeah, that makes sense. And the last question I have for you, are there other social platforms that you use and you think are somewhat comparable to Twitter? Are there any other platforms that are like on the come up that you think you're bullish on or is Twitter really for anyone listening to place that they should just dominate and really who cares about anything else? I mean, well, let me, I'll answer that, but I also want to circle back to you asking me, I didn't answer you actually about what my goal is with Twitter. And I don't know my goals with Twitter. I mean, to be honest with you, I make some great little extra side money with it. It's become sort of a superpower. It's great proprietary deal flow for common commerce or e-commerce holdings company. I mean, the networking is crazy. I'm a college dropout who's like, just got never networking. I mean, even me chatting on the phone with you here right now, all the big players in the e-commerce space, like are literally a phone call away from me now at this point. And it's not a world that was like super, super deep with them before. You know, like I was, I played in it and I consulted in it, but I wasn't like this internet, you know, community that is around now. I like people getting on my email list because I'd want to own that because I believe in owning your channel being super important. But so that's my goal with Twitter is to get people on my email list and really network and get some deal flow to answer your question about other social networks. I'm, I feel like everyone's trying to keep this a secret, but it's like so far from a secret. Like YouTube is just definitely it. Like YouTube is just for sure. Like it's just that the barrier of entry is a little bit higher. Cause you have to like make really edited content. I think in general to really grow. Um, I love YouTube. I've done three videos ever and I get like 20 organic views a day, which is just crazy. The thing about Twitter is that like I tweet and it's, and it's gone within two days forever. No one ever sees it again. So I'm super bullish on YouTube. Second largest in the world also become a paid traffic standpoint. I'm super bullish on it. I think it's just most brands don't have, don't know how to run video. And so this becomes a higher barrier to entry, but to really solve your question about should people just go hard on Twitter? Not necessarily. I really think that like certain channels work for certain things. And for me and you are like very info based, right. And like happens to be that there is this Twitter works, you know? Um, but like, you know, some people ask me, should they go on Twitter? And I just don't think it's the right channel for them. Right? Like I have a lot of friends who are huge on Instagram, right? I'm not sure they would ever be able to do anything on Twitter. Right. I'm not sure that would ever translate for them in Twitter. And then for some people, YouTube works like Alex Becker crushes it on YouTube. Right. Look at his Twitter. He just tweets about DeFi stuff, right. And crypto. Um, and so like, I think that the real answer to you is that like a lot of people think Twitter is dead. I mean, it's one of the smaller social media networks that have like the big ones, right. It's not as big as Instagram or YouTube or Facebook. Um, you know, politics fully aside, like fully forget politics. I think Twitter needs to thank Donald Trump because I think that Trump being on Twitter had made it have a huge resurgence like it was literally on the news every single day in a way that it hadn't been for a long time. Um, but yeah, I think the answer to your question is really just about really fully finding your channel, like really, really finding your channel and you know, whether it's, you know, someone like Trump that everyone hates or someone that everyone loves, like pushing it is like, uh, you know, making, you know, it's serendipitous to have big celebrities with other followings pushing a channel. Um, and so yeah, Twitter's not for everyone. It's definitely for me and you. And I think that if you're in the area of marketing space, Twitter is probably the best channel for you. Um, but yeah, it really depends what you're into to be completely. And this was so fascinating. So interesting. So different than any other interview I've had on in terms of the content and the style. I love this. I'm actually probably going to go drop this today. So you're listening to it on July 1st, you're hearing it on the first day. It's that good. So you're skipping the line. We're going to drop it, you know, today, if not tomorrow, the latest. Thank you so much for being here. Best place for people to reach you. I'm guessing is your Twitter. Uh, what is your handle? Yeah. Find me on Twitter. It's Jameson camp or James on camp. Um, and yeah, Twitter's it or nanoflips.com is my newsletter, but yeah. Chase, thank you so much, man. I appreciate it really, really. Of course, dude. Cheers, man. Cheers.