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Just because you don’t “lose money,” doesn’t mean you didn’t lose money...
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Key takeaways
- Here's how I lost $15 million trying to start a food business.
- The first month sales were a little disappointing for me, so we did like 600,000 the first month.
- Now, you might be like, "That sounds like a lot of money." But, let me walk you through the margins of this business.
- Now, here's the part that [clears throat] no one wants to talk to you about in the food business.
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Full transcript
Locally archived YouTube transcript with timecodes. Speakers are assigned heuristically and may be corrected editorially.
0:00Here's how I lost $15 million trying to start a food business. I thought, "Okay, I'm in fitness. I talk about nutrition. I can start a food company." We did this big launch. The first month sales were a little disappointing for me, so we did like 600,000 the first month. Now, you might be like, "That sounds like a lot of money." But, let me walk you through the margins of this business. So, we're doing $600,000 per month. Now, the average meal was 10 bucks. So, we were selling 60,000 meals per month. Well, sounds good, right? Times $10. Now, here's the part that [clears throat] no one wants to talk to you about in the food business. My cost was $9. I had to cover every expense,
0:35>> [music] >> marketing, sales, payroll, on this $1. I was able to make in this business somewhere in the neighborhood of 7% profit margins. I just 5x the amount of headache for an extra this much [music] profit. Honestly, I might have made 500 grand on this whole thing. I decided to take my eye off the big pile of money and go on the small pile of money, and I lost a year. Just because you don't lose money doesn't mean you didn't lose money.