Advice from a Finance Guy: Understand the importance of product & how ecommerce businesses can benefit from competition in their category.
"When the pie grows, everyone enjoys a bigger piece.” Andrew left behind his finance career to start his D2C business BEVVO. We discuss his journey from finance guy to co-founder, his views on the importance of product, and how ecommerce businesses can benefit from competition in their category.
We spoke about:
Christian Hoppe
Welcome, Andrew. Nice to have you. Excited to speak with you today.
You write on LinkedIn that you are a finance guy with an entrepreneurial spirit. It's interesting to hear about your story and how you decided to start an ecommerce brand.
Andrew Dulgar
Sure. I went through the traditional route of schooling and education. I am a trained accountant, a CPA (Certified Public Accountant), or at least I was a CPA until last year when I gave up my CPA designation. I went through CPA certification in Canada because I was born in Montreal and worked in different industries.
I worked in retail and fashion for different brands for the past decade, always in financial analytical roles.
So, budgeting, forecasting, financial planning, and so on for companies. That was my strength. I was always good with numbers and interested in business. Marrying the two led me to finance.
But the entrepreneurial spirit I have, probably from a young age, I was always interested. Believe it or not, when I think back, I was probably 10 or 12 years old when I knew of Alibaba.
Nowadays you hear about it, it's much more known. But back in the day, the first hustle I did was when the first iPod came out, I bought earphone spools, these little silicone earphone spools.
I bought them for a dollar each. I bought 50 and sold them for $5 each. At my high school, a lot of people were getting iPods because this was the new thing. It was something so simple.
Then I started venturing into different hustles, like buying Lacoste polos through Alibaba when that was trendy. They weren't real polos, but they looked very real.
So, I bought those and sold them. I was always into selling tickets to shows and different things like that. I had that hustler spirit.
But I went the traditional route, working for different global companies and getting experience there.
But five years ago, randomly, my wife and I decided to start a company we call BEVVO. We were smoothie fans living in Montreal. We lived in the city center and worked a 15-20 minute walk away. We made our smoothies in the morning, walked to work, and had the smoothies on the go.
At the time, we had a plug-in blender. We’d plug it in, transfer it to our cups, and by the time we got to work, the smoothie’s freshness was gone. So, I Googled 'portable blender' or 'cordless blender' and saw a few options, mostly still plugged in. There was one cordless blender, but it looked like a gadget or toy.
We started searching for suppliers just to see if there were other options, not thinking we would start this brand ourselves. Then we found a good-looking product. But to work with the supplier, they wanted us to meet certain minimum order quantities. We were trying to get a sample for ourselves, but then we thought, "What if we try to sell these things?"
My previous experience with buying and selling came back, so we started creating a brand, logo, and packaging. The supplier’s minimum order quantity was 1,000 units, which we split into different colors. We did that in mid-2018 and developed the product. We modified it a bit, put our logo on it, and tested the market. The feedback was good, and we sold through the first generation.
There were many learnings about product improvement and ecommerce. Our idea was to sell directly to consumers, not retail, and we thought it would be a cool product people would enjoy. We were right. We launched in 2019, sold out, and ordered more inventory. Before getting more of the first-generation version, we developed a second-generation version by modifying an existing product the supplier had.
We launched on pre-order in early 2020, then the pandemic hit. Our delivery timeframe was thrown out the window, and that was tough. We had a backlog of pre-orders and needed to deliver by a certain time. We started pre-orders in February 2020, expecting to deliver by April 2020. In March 2020, the pandemic hit, factories closed, and there were delays.
We had accumulated pre-orders and kept taking them because our supplier said they could still hit the April target. But we kept having to delay and update customers. Some customers didn’t want to wait, so we refunded them. There was skepticism around non-USA-made products, and customers canceled. It was a challenging period, but we got through it. We started delivering orders in June and July, air shipping into the US.
We focused on our BEVVO 2 version for the next couple of years. Two years ago, we decided to create a new product from scratch, which is now our BEVVO 3 version. A supplier with R&D in the US reached out. Communication with them was easy, and we shared our vision for the product. It took us a while to jump on board with this new supplier. What sealed the deal was trying to create the third generation with our previous supplier and not being on the same page about quality.
We had discussions with the new supplier and finalized things by the end of 2021. We began the design process and prototyping. That’s the journey from being a finance guy, which I still love, to creating a product we love.
We love smoothies. It's a product anyone can use. We have a three-year-old daughter who loves smoothies. It's a quick way to get vegetables in. We sometimes make smoothies with bananas or strawberries and sneak in chickpeas or broccoli. Having something compact and easy to use makes it easy to get fruits and vegetables without the hassle of a bigger blender. That’s where we are today, excited for the Gen 3 launch.
Christian Hoppe
Really cool story. You came from a problem you had yourself. You didn't find a solution, so you created a different product. Many founders come from marketing or product backgrounds. How did you experience this from a finance perspective, seeing many businesses from the inside? How did that change your view?
Andrew Dulgar
Looking back, I would acquire some skill sets externally before jumping into ecommerce and selling online. It wasn’t as simple as we thought. Many brand founders say if they knew how hard it would be, they might not have started. It was challenging to create and sell a new product.
My finance skills were valuable for allocating capital and resources to generate returns.
Christian Hoppe
One thing that stood out was your focus on iterating and making the best product. You had to decide whether to continue with the second version or create the third. What drives you to make the best product, and have you seen the results?
Andrew Dulgar
Right. That's a great question actually, because that was something I would say in our nature initially to not to do, really to slow down.
When we started, it was a very new type of product to have a blender that didn't need to be plugged in. That was very new. Even if you searched on Amazon, there weren't many options. Our focus at that time was speed.
We wanted something that looked nice that wasn't available in the market. But we knew we wanted to get to market quickly. As time progressed, we saw that many options became available in the market.
Often at the low end of the market, cheaply made, we would see reviews of the different products available on Amazon or even some of the bigger brands. And the product just didn't seem to be of high quality.
So, that put us in the direction of, well, if new people will enter the market, why do we need to rush to get market share? Initially, we feared, "Hey, if we don't do this right away, we're going to miss out on the market."
But over the past five years, my mindset shifted a little bit. I think there's always going to be a market. If I look at the type of product this is, people's concern with health, people living active lifestyles, and often being on the go are things that won't regress.
I think people will continue to want to be healthier with remote working and the way the world's evolving. Being on the go will be an important part of things, and people wanting to stay healthy while on the go is a good marriage of those two.
So, rather than jumping into a generation 3 with our previous supplier and it being only incrementally better, we said, "Let's take a chance with this new supplier." They create products for brands in professional sports leagues.
Whether it's the UFC, Major League Baseball, or the NBA, this is a supplier we felt confident in based on the products they gave us of other brands they worked with. They were producing stuff at high quality. And we said, markets, the idea of market saturation, if I think of water bottles, there's hundreds of water bottle brands, right?
Obviously, not all of them are successful, but many are successful, very simple vacuum-insulated water bottle brands. I don't know if a blender will reach the scale of a water bottle, but my sense was that something like this will become more widely available and known over time.
And we want to establish ourselves as having the best quality product rather than being another 'me-too' product. That was our thinking.
We started wanting to do things very quickly and get our name out there in the market, fearing we'd miss the opportunity. But we realized, "Hey, the opportunity will always be there. Let's slow down. Let's create something we'll be extremely proud of and super confident in, especially when approaching retail."
That's why we pumped the brakes and took a couple of years to develop this. Once we told our previous supplier that we didn't want to pursue the Generation 3 version with them, we lost access to our Generation 2.
So, the past couple of years have been without inventory and focused on developing this product. That's where our mindset was.
Christian Hoppe
Wow. At that point when you started with the idea, did you think that you were generating or creating a new category, or did the category already exist?
Andrew Dulgar
Yeah, that's a great question.
If it existed, it was very, very young in its existence. There were very few brands, maybe one brand really, if you call it a brand. But in the past few years, some bigger blender brands have started creating a portable version.
In one sense, you might think, "Wow, now there's much more competition." But I see it more as validation in the market. If bigger brands that traditionally create plug-in blenders or other appliances believe this is a worthwhile investment or segment to pursue, it validates consumer interest and proves our point of wanting to create a product that can sit on the shelf at high-end kitchen stores or department stores and be unique in the space.
Initially, the market was very young. A lot of the products, whether on Amazon or direct-to-consumer websites, were very flashy and colorful, not something that resonated with me as a consumer, and not something I wanted on my counter. They felt more like toys or gadgets. But I think each brand entering the space will find their own lane and customers that resonate with them.
There are water bottles that you can buy for almost $200 that just keep your water cold, and some for $10 at Walmart. So, there's a spectrum. We respect our space in the industry and recognize that people will continue to enjoy smoothies on the go for a long time.
Christian Hoppe
Yeah, I agree that sometimes brands think that it's quite easy to build a category, but it's really, really hard, right? If nobody knows about the category, you have to create the awareness first.
And then you're also opening up the space to others, but you're doing the hard work being the first one. If others help create the awareness, that can actually help you if you have a better product and positioning than others. Then you can capture the market.
It's an interesting take. How do you deal with the competition then?
Andrew Dulgar
It's a great point. Just to touch on what you said, I was listening to a podcast, the Operators Podcast, run by four well-known operators in the space.
You have Simple Modern, Ridge, the founder of Pila Case and Lummi, and HexClad operators. Mike Beckham, who runs Simple Modern, looks at someone like Stanley, who's gained a lot of attention in the past year or two, as actually benefiting Simple Modern. It's bringing attention to the category of vacuum-insulated water bottles.
As a result, people who weren't considering this type of product before now are. They might search for a vacuum-insulated water bottle intending to get a Stanley bottle but find Simple Modern or another brand and decide they like that product or design better.
If you view competition as growing the whole pie rather than just dividing a small pie, you have a more infinite view of your business and the industry. At the beginning, we felt like we had to get a share of a small pie. Now, I see it as a long-term game, and the pie will only get bigger.
Even today, when people see our product, they didn't know this type of product existed. They'll say, "Wow, you don't have to plug it in." So, as small as we think we are and as big as we think other brands are, there are people who have no idea this type of product exists and that they could benefit from it. I think we're still in the very young stages of the market.
Christian Hoppe
That's a great view. Interesting. So how do you deal with competitors or how do you position yourself against other players that come in?
Andrew Dulgar
Yeah, I think so... Touching back on the previous question, we wanted to create something of the highest quality possible.
Over the past two years, there were points where we could have said, "Okay, the product's good enough. Let's get it to market." But without the urgency of wanting to get it to market, we said, "No, let's wait. Let's create the best product we can."
No product is perfect. If you think of the iPhone when it launched and how Steve Jobs announced it, compare that to the new iPhone today. If you held back for a perfect product, you’d never launch iPhone 1. So, ensuring we have a high-quality product is key so that if customers take a chance on us, they'll see the value and use it every day.
In terms of competition, focusing on the customer is always the priority. If we can give the customer the best experience, great. If a customer finds another product better suited to their needs, whether it’s the look, price point, or other factors, that’s fine too.
Thinking of it as an infinite game and the pie getting bigger, I hope competitors do a good job in marketing their products. Competitors with bigger budgets can drive more awareness to the category, which could be good for us as a smaller brand.
I don't feel the need to dominate the category. We can have a nice segment focused on high-quality products and be fine, servicing customers who value that aspect of the product.
Christian Hoppe
I love that view. It's a great attitude to think competition is great. The pie is getting bigger, and so the share for each of the players in this category is getting bigger.
And yeah, I love the focus on a great product. Obviously, one of the challenges I can think of for your product specifically is that it's not a consumable, right? So, it's not recurring.
What challenges does this bring, and how do you deal with that?
Andrew Dulgar
Yeah, that was one of the things that going into ecommerce itself, or starting the brand itself, we had no idea.
The concept of the lifetime value of a customer was something so beyond us, and we didn't realize how expensive advertising through social, traditional digital channels, whether it's through Facebook or Instagram, would be.
The game really is a long-term game, hoping to build a loyal audience that you can eventually sell other products to. That was something we learned throughout the process.
We iterated a little bit because we initially launched only the blender. With our second-generation version, we launched accessories. Last year, we partnered with different apps that allowed us to have a marketplace on our website.
So, we do sell consumables right now, but it's third-party consumables that we're selling on behalf of different brands.
Without giving too much away, consumables are something we envision in our roadmap. We've done a lot of research and started different projects on it. Landing on something of high quality wasn't possible at the time.
We had to decide whether to invest our resources in developing a better flagship product, the blender itself, or in inventory of consumables. We wanted to establish the flagship product first and our name in the market.
Eventually, we believe we can layer in consumables. We've tested different products from suppliers and have gotten into recipe building.
We think we could have smoothie packets that customers could easily throw in, add their milk or water or ice, and have something fresh and ready to go. Customers will know what to do themselves, like adding their protein.
Consumables are definitely part of our roadmap, but we want to ensure high quality. Ideally, we want all organic fruits, which isn't really available in the market.
We enjoyed chunked fruit. A lot of what we see in the market is freeze-dried fruit powders. While they taste great and make a smoothie feel fresh, we think the experience of having chunks of freeze-dried fruit blend with our blender is more exciting.
We've already looked at a few things, and consumables are part of our roadmap. We want to build our customer base first, who value the high quality of our blender, and then translate to high-quality freeze-dried packs or other consumables.
We have a marketplace on our website right now that we haven't pushed much, but customers can hop on and pick different categories, like nut butters or latte mixes. There's definitely long-term value in that.
Christian Hoppe
That's an interesting point. I recently spoke with a founder who said something similar—you first have to think of a product that actually works in D2C, right?
Or in ecommerce, because if you have a commodity product with a lower AOV, etc., you know from finance, it's very hard to make it work. The benefit you have is a great product that works and has a better AOV.
Once you have this customer base, just as you mentioned, you build out the customer base first, then you can add a lot of products.
Even if it's more commoditized products that wouldn't work otherwise on acquiring customers because it doesn't work.
Andrew Dulgar
That's true, 100%. The commoditized view is something we didn't want to get into before establishing the quality product we have, and you're 100% right.
I have a list on my phone, a note every time I think of a product that could benefit users of our product. For example, we have a three-year-old daughter and a three-month-old daughter, and my older daughter loves smoothies.
One issue is she's often having a smoothie in a cup, and there's mess involved. If she's using a sippy cup with a straw, the straws are often too small. So, I've started researching if we can have small toddler cups with bigger straws specifically for smoothies because it doesn't really exist in the market. Other parents could benefit from this, especially if they're on their way to daycare.
You can have a vacuum-insulated smoothie tumbler with a bigger straw that kids can enjoy without making a mess.
There are many ideas we can expand on, like smoothie bowls. Some people prefer having a smoothie with a fork and spoon, so maybe we can have a vacuum-insulated smoothie bowl that keeps the smoothie cold.
There are different things we want to experiment with, but we don't want to go too wide before focusing on creating this product in the right way first.
Christian Hoppe
You shared already, because one of my questions was what is your outlook, your vision for the brand?
Is there anything else that you see for the brand or also for yourself? Do you want to do the brand long-term, or are there any plans around it?
Andrew Dulgar
Yeah, it's like you think how infinite could your brand be? Could you run this brand for generations? I don't know, right? What will the world look like in 10 years? What will it look like in 20 years?
Our bet is that people will continue to want to be healthy, healthier and healthier. We think people will be increasingly mobile in the world. And we think this product marries those two.
Maybe one day people will just swallow a pill and get all their nutrients. So, maybe we'll be phased out at that point. But we are excited about this product.
We envision us running this brand for a good number of generations, not family generations, but we are in gen three now. We can easily envision a gen four, five, six.
There's already ideas to improve this as well. Running the brand and getting it to a level where we feel it can be the thing we do for our family. And this is what we're excited about every day. That's the short-term, midterm goal.
Who knows what we can do? Maybe we could partner with a bigger company that would give us access to more distribution. That's all on the table.
We are up for anything, but right now it's launching this and proving to ourselves that we made the right call in waiting and developing a product we're proud of and that can sit on the shelf of the best stores or the best counters.
That's what we're focused on.
Christian Hoppe
It sounds like your next generation, your daughters, are already getting familiar with the product. So, indeed, it's already a generational business.
Andrew Dulgar
Yeah, I don't know if it'll be a generational business in that sense, but who knows, right? For us, if we think of our space in the market, there's a very like, if I think of Apple, they create the highest quality products and have an extremely high perceived value and market share. That's a rare triangulation when you have the highest quality product.
It's rare that you'll have the biggest market share. So, I think of us as maybe a motorcycle brand like Ducati. They might not have the highest market share, but they focus on creating extremely good quality products and have their segment of the motorcycle market in the face of Yamaha or Honda.
Carving out our space, not feeling the need to be the market leader, but having a segment of customers who resonate with us. There'll always be customers who value this higher quality version or the version that looks nicer or matches their counters or kitchen better.
So, I don't know if it's a multi-generational business, but I think this will definitely be something we're excited about for the next while. And maybe it'll lead to other offshoot businesses, which we already have ideas for. So, who knows?
Christian Hoppe
Great. From all your experience over the last five years and also from your finance background, what is some advice you would give to founders?
Andrew Dulgar
It's funny you say that. Specifically, the experience in finance, I think, I don't know the expression in English, but I'm from Montreal, Canada, so I also speak French. One of the sayings is that the cobbler always has holes in his shoes. The person that makes shoes often has the worst shoes.
So, having a good financial plan when you're starting is a really good idea. It doesn't have to be a huge business plan or case, unless you're trying to get funding. I'm a finance person and thought I could do a lot of the stuff in my head.
We didn't create a formal financial plan when we started. Often, you forget additional costs for inventory and different things. Your unit costs and spending can fall to the wayside.
Being clear on your financials as a framework to grow your business is super important. Even as a finance guy, it wasn't something I did because I felt like I had a grasp on the numbers. But it's always a good idea to build on that.
Also, decide how long-term you want to do what you're doing. If you're focused on drop shipping and want to be in and out with certain products, that's one mindset. You have to focus on speed.
But if you believe what you're building is valuable and can serve customers over a long period, adopt an infinite mindset. Slow things down. Don't feel like you have to rush.
"Haste makes waste." When you try to do things too quickly, you end up paying for it. We tried to rush production and then faced quality issues.
Be clear on the longevity of what you're doing. If you're excited about it for 3-5 years or 5-10 years, take the time to do things properly. You'll benefit from it.
Whether it's designing packaging, the product, or doing the right photography, if you can afford it, it's worth it in the end.
Christian Hoppe
Great advice. I think something that you've mentioned a couple of times in our conversation is don't think short-term, don't get formal, right?
Don't think you need to capture the whole market share but do the right thing and think long-term and it will work out.
Andrew Dulgar
Market is big. At the beginning, we didn't realize how huge it is, especially as a D2C brand when you can sell globally. If you have a product that sells globally, the market is huge.
People talk about market saturation. How big do you want to be? Does anyone aspire to be Apple? What revenues are you expecting? If you expect billions, you might carve out a bigger chunk of the pie. But if you're creating a business for yourself and your family, helping thousands of people, that's significant.
We've helped thousands of people in their daily lives. Sometimes we get emails or reviews from people who bought the product a year or two ago. We have repeat customers buying a second or third time, leaving reviews saying they've used it for two years and love it.
You realize you're touching people every day without even knowing it. It's easy to be down when you don't have momentum in your business and not realize your product extends beyond your immediate scope. You're selling a product that benefits people daily.
For example, our blender helps nurses working overnight shifts. Restaurants are closed, and they want something healthy. It's compact, they can bring their fruit, and enjoy something fresh at midnight, 1 a.m., or 2 a.m.
Recognizing there are humans benefiting from your work is important. Having a long-term view and thinking about how you can best serve those customers is always good.
Christian Hoppe
I love that. Thinking about the people you're actually impacting is often tough when you work digitally. It's easy to forget or not understand who your customers are.
Andrew, it was really great. You shared a lot of insights. Thank you so much for that.
Who would you like to connect with? Who should connect with you, and how can they reach out to you?
Andrew Dulgar
Yep. Absolutely. Thank you.
Sure, like I said in the beginning, we haven't been very vocal in our journey so far, but we're really excited about Gen 3.
So, we're starting to be a bit more vocal, me specifically, and explaining the journey of what we've been building and the good and bad of what we've experienced.
They could probably reach out to me or connect with me on LinkedIn. Search for Andrew Dulgar. Otherwise, eventually, I'll probably do a Twitter or Instagram, but right now, LinkedIn is the best place.
Christian Hoppe
Great, we'll put also their website in there so people can check out the product. And yeah, thank you so much for being here and sharing all your insights.
Andrew Dulgar
Excellent. Really appreciate your time. Thanks Christian.
Hey, I'm Chris 👋
I started out in marketing & ecommerce 15 years ago.
Building websites, online shops and running ads.
In 2019, I built waterdrop's direct-to-consumer business, growing it from $5 to $100 million in three years.
And worked as a fractional CMO with several 7- to 9-fig brands.
Today, I help winning ecommerce brands grow faster & more profitably with Forwrd Agency.
I also run my own businesses and invest in the ecommerce sector.
People know me for my straightforward, honest, and critical insights.
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