How We Started A $3K/Month Premium CBD Brand

$3K
revenue/mo
2
Founders
0
Employees
product
elate
from Chicago
started September 2019
$3,000
revenue/mo
2
Founders
0
Employees
3.39M
alexa rank
1.4K
followers
88
followers
market size
$9.3B
avg revenue (monthly)
$136K
starting costs
$43.7K
gross margin
75%
time to build
10 months
average product price
$10
growth channels
SEO
business model
E-Commerce
best tools
Instagram, Dropbox, Google Suite
time investment
Side project
pros & cons
33 Pros & Cons
tips
11 Tips
Discover what tools Jacob reccommends to grow your business!
shipping
customer service
reviews
social media
accounting
productivity
analytics
stock images
referral
Discover what books Jacob reccommends to grow your business!
Start A Cbd Business

Hello! Who are you and what business did you start?

Hi Everyone! My name is Jake Meyers and I’m the founder and CEO of elate CBD. We are a premium CBD brand on a mission to shatter the cannabis stigma and promote balance, clarity, and happiness for everyone.

how-we-started-a-3k-month-premium-cbd-brand

We offer CBD products formulated to increase focus, reduce stress, activate physical relief and recovery, and assist with a better night's sleep. Our products are 100% sourced from organically grown U.S. Hemp plants, produced GMP certified U.S. facilities, and third-party tested.

Our 2021 product line includes Full Spectrum Lemon Lime & Raspberry flavored Drops (tinctures), Full Spectrum Soft Gels, Freeze Gel Roll-On Topical, and CBD/CBN Sleep Blend Drops (tincture). Each product has the perfect mix of CBD, and multiple other cannabis compounds known to help with our four main benefit targets- Focus, Calm, Recover, & Sleep.

In September 2020, we did a grassroots launch with virtually no advertising. We were able to close out 2020 with $15,000 in revenue & a 50% bottom line.

how-we-started-a-3k-month-premium-cbd-brand

What's your backstory and how did you come up with the idea?

After spending almost a decade in the corporate world, about a year and a half ago I finally stopped for a minute and asked myself what I actually want to do with the rest of my life. I'm an extravert. I love people, I love meeting new people, I love making people laugh, I love making people feel good about themselves. I genuinely love to make people happy. So I decided my purpose moving forward was going to be to help as many people as possible live happy, healthy lifestyles.

Don’t be scared to reach out to your network, grow your network, and partner with people in your network. Without our network, we would not be a company today.

I’ve always had an entrepreneurial spirit but just couldn't pinpoint the exact industry that I could be most passionate about or the right product that I truly believe in. After several years of bouncing ideas back and forth with a good friend, he mentioned he had heard about CBD and its relatively low barriers to entry and it clicked. Cannabis has been a part of my life for multiple years and has improved my mental and physical wellbeing and overall quality of life. It's a health and wellness tool that can help people do exactly what I've set out to do and the industry is just getting started.

At the time I thought I knew quite a bit about the cannabis world, but as I started researching I realized there is a lot more to it than people think. I had to teach myself about the different types of cannabis & cannabis compounds, cultivation, product manufacturing, and testing, rules and regulations, and the list goes on and on. I realized while teaching myself everything, I never got bored and never lost interest. This was a sign to me that I was making the right decision to get involved in the cannabis industry.

A lot of people think the cannabis market is saturated and underestimate how much of the general public/noncannabis users still need to be educated. Yes, the Cannabis business is booming but it’s nowhere close to its full potential as it continues on the path towards full legalization and the average person begins incorporating it into their life.

After months of research, I finally landed on an idea for the branding, target products, and strategy to make cannabis accepted. From a financial standpoint, I wanted to go at this alone and was able to do so because of the low initial investment to get going.

how-we-started-a-3k-month-premium-cbd-brand

Take us through the process of designing, prototyping, and manufacturing your first product.

During my initial research, I first had to sift through several cultivating and manufacturing partners and identify who would best fit the brand and strategy. I went through tons of product samples and read through endless lab testing results to make sure I had the highest quality products. There are a ton of CBD brands out there that are strictly in this industry to make money and don’t care about product quality or their customer’s needs. We are not one of those brands.

On top of finding the right partners, I needed to create the brand. This has been the most exciting part of the process for me as I’ve always been a creative person. After spending 10 years in the corporate world, I had to almost reactivate the creative part of my brain and it has truly brought me back to life. I had this vision in my mind for a logo, color palette, and overall brand feeling and thankfully one of my best friends is a top-tier graphic designer. We went through about two months of the logo and brand design brainstorming and he absolutely nailed it.

Once the branding was complete I had to start taking a look at bottling, labeling, and FDA rules and regulations. Although we are selling a federally legal product, there are plenty of guidelines that must be followed and we strictly adhere to those. Once the labels checked off-brand and legal guidelines my first round of product was officially complete, $12k plus a ton of sweat equity and I was off to the races.

how-we-started-a-3k-month-premium-cbd-brand

Describe the process of launching the business.

I originally had to take on everything by myself, including financing. As I mentioned the start-up costs were relatively low so I decided the best route for me to take would be to fund the business with a credit card, I’m all about the points. About 75% of my initial start-up costs were inventory. The other 25% included additional packaging, shipping materials, and eCommerce needs.

While all of the product development was underway, I was simultaneously teaching myself eCommerce and how to create a website through the Shopify platform. At that time I had zero experience with any sort of eCommerce or website design, and once again I had to teach myself something totally out of my wheelhouse. I really have to give a huge shoutout to Shopify for having such an amazingly easy-to-use platform with plenty of resources for learning.

My first couple of days on Shopify were spent on the backend processes like shipping, payments, inventory, etc. After that, I was activating that creative portion of my brain again trying to layout a website using stock photos, templates, and whatever I could find. I’ll never forget my first layout. I was so proud of what I put together and showed a friend of mine. His response: “you know you can pay someone to do that for you right”. Back to the drawing board.

I spent months teaching myself Photoshop, creating copy, and building the layout of the website relying on feedback from my closest friends who were probably beyond annoyed with me (I appreciate you all). I finally got it to a point where I thought the website was good enough to launch about a month or so after I received my first round of inventory. When I look back at my first website designs I can’t believe how far it’s come and how much fun I had doing it.

The biggest thing I learned through the launch process is how important it is to utilize the resources around you. I actually ended up bringing one of my best friends on as a partner because he was so heavily involved and we are continuing to build the business together. I wouldn’t be where I’m at today without the feedback and help from my friends and family.

how-we-started-a-3k-month-premium-cbd-brand

Since launch, what has worked to attract and retain customers?

Product is number one. Without quality products, you will never be able to attract and maintain new customers. During our initial launch, we relied on our own personal networks and social media to get the business off the ground to see where the level of interest would come from. Our grassroots campaign worked really well for us and if you have the network to do it, I recommend it.

One of the major things we did after the launch was to create a Google my business. This made our website traffic explode. If you can create a GMB with a physical address (even if you are doing it online only) and maintain it regularly. We also partnered up with an amazing SEO company to help drive website traffic as well.

Unfortunately, even though we are selling federally legal products, Facebook and Google still have them listed as banned substances in their advertising policies. This means absolutely no paid advertising for now. Outside of SEO, we continued to utilize our network of influencer friends to help us get the word out. To this day we rely heavily on influencer partnerships especially our micro-influencers.

As far as sales channels go, again we are limited due to Facebook, Google, and Amazon policies. We can currently only sell through our website but are looking forward to other sales channels opening up as Cannabis laws continue to change. It’s tough selling federally legal products that aren't accepted by major companies that others use to grow their businesses. However, we are finding ways to make it happen!

how-we-started-a-3k-month-premium-cbd-brand

How are you doing today and what does the future look like?

As of today, we are profitable. We just launched a brand new line of products that we are extremely excited about, with more on the way. We have been solely focused on D2C but have created a great wholesale program and are looking to hit the shelves in 2021. We also have a great partnership program in place that we are looking to expand as well.

Ideally, our business will be split 70% online and partnerships and 30% wholesale this year. We are still packing up orders and shipping them out in the house, but are looking for 3PL solutions in the near future.

One of the things we are most excited about is growing our business with strategic partners. We have actually brought Metta World Peace on to the elate team as an advisor with equity in the company. We have big plans this year with our man Metta so stay tuned!

how-we-started-a-3k-month-premium-cbd-brand

Through starting the business, have you learned anything particularly helpful or advantageous?

One of the biggest things I learned is that things will constantly be changing. We are nowhere close to where we started and we continue to make changes daily. The ability to pivot and move on is necessary when starting a business and that’s something I struggled with in the beginning.

Something else I learned from a good friend is to not miss out on any opportunity just because something isn’t perfect. Nothing will ever be perfect during the startup process so if someone reaches out to you for a feature or a post and you don’t have that perfect image to share with them, do it anyway. Always take advantage of anything that comes your way.

This is such an old saying but still proves to be true to this day, your net worth is your network. Don’t be scared to reach out to your network, grow your network, and partner with people in your network. Without our network, we would not be a company today.

What platform/tools do you use for your business?

Our platform for business is Shopify. It is honestly the easiest way to start and maintain an eCommerce business. Everything from domain needs, inventory, shipping capabilities, website design, tax assistance, you name it, Shopify has it. Tons of Shopify apps can be integrated into your website and we’ve tried several. The ones that stuck with us are:

  • Klayvio - Email marketing
  • Bundler - Product bundling
  • Poptin - Pop-ups
  • LayoutHub - Page builder (the best way to take your Shopify pages to another level)
  • Product Reviews
  • Shopify email marketing

On the productivity side, we use G Suite for all of our needs. You can also link up Trello to your G Suite. Trello is a great way to project manage and collaborate as a team. I highly recommend it.

For finance, Quickbooks and Truebill. I’m far from an accountant so Quickbooks has been a lifesaver, and Truebill is a great way to get high-level overviews.

What have been the most influential books, podcasts, or other resources?

To be 100% transparent, I’m not much of a podcast guy and I don’t have the mindset to constantly read books, and that’s ok. I’m a social person, I thrive on relationships and I learn directly from others.

Authors and podcast hosts have amazing ideas, thoughts, and opinions. However, the most influential resources I’ve had over the past few years to break out of the corporate world and do something great are my closest friends that are also entrepreneurs. I feed off the success of those around me. Surround yourself with motivated people, lift each other and celebrate wins together.

Advice for other entrepreneurs who want to get started or are just starting?

In the words of Joe Dirt, Keep on Keepin’ on. Starting a company is not easy and a lot of the time you’ll find yourself wondering why even bother. You aren’t alone. If you have found your passion and truly believe in your product you will be successful. I found myself in several terrible situations one day ready to hang it up, then the next day something amazing happens. Don’t overthink things, keep a cool head, be rational, and just have fun doing what you love.

Side note: Joe Dirt is arguably one of the most inspirational movies of our time. If you haven’t seen it in a while it’s available on Prime Video. Life’s a garden, dig it.

Are you looking to hire for certain positions right now?

We currently are not looking to hire full-time. However, we are always looking for paid part-time affiliates to join the elate community, as well as strategic business partners.

Where can we go to learn more?

If you have any questions or comments, drop a comment below!

-  
Jacob Meyers,   Founder of elate
Pat Walls,  Founder of Starter Story

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