We Created A $240K/Year Laundry Detergent

$20K
revenue/mo
2
Founders
7
Employees
product
Dirty Labs
from Portland, Oregon, USA
started January 2018
$20,000
revenue/mo
2
Founders
7
Employees
285K
alexa rank
3.34K
followers
28
followers
4
subs
market size
$13.2B
avg revenue (monthly)
$20K
starting costs
$37.9K
gross margin
30%
time to build
24 months
growth channels
Referral Program
best tools
Pinterest, Tiktok, Instagram
time investment
Full time
pros & cons
44 Pros & Cons
tips
2 Tips
Discover what tools David reccommends to grow your business!
email
social media
productivity
payments
Discover what books David reccommends to grow your business!
Become A Laundry Detergent Manufacturer

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

Hello there! I’m David Watkins, CEO and a co-founder of Dirty Labs. Dirty Labs is a cleaning innovation lab created with a mission to take the ‘dirty’ out of cleaning.

The first products from the company are a line of laundry detergents that solve what we call a cleaning trilemma. For years, products have either been safe, sustainable, or effective, but rarely, if ever, all three. Our goal is to create solutions that leverage nature-inspired green chemistry to solve this problem. We’re making a significant change in the way cleaning products are formulated. We think we’ve achieved this goal with our first line of detergents tested for market-leading levels of efficacy while also making a giant leap forward in safety and sustainability.

we-created-a-240k-year-laundry-detergent

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

Cleaning products are a new category for me. I had spent years making consumer electronics products for big brands like Google, Skullcandy, Jawbone, and others, and while I enjoyed seeing the products being widely used, I also didn’t like that most of the things I was making had an average lifespan of 6 to 24 months.

The opportunity to create Dirty Labs came about when I was introduced to my co-founder, Dr. Pete He. Pete is a remarkable chemist with a background in both home and personal care products. He was an R&D and sustainability leader at several large chemical corporations, and after exploring several ideas, we fairly quickly identified laundry detergent as the product we wanted to start with. It’s a technical challenge to innovate in this space, and it’s a category that is dominated by a handful of large companies. We also liked that it was a care solution for heavily branded products, such as apparel and home textiles, and that many of these brands and their customers were making a sustainability push as well.

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

Pete and I partnered with two other chemists that have since joined the company to create the initial prototype formula that would become our first product. Our initial prototype proved that we could get to the same or better levels of cleaning than the conventional market leader using bio-based ingredients, but it wasn’t quite as ‘clean’ as we wanted it to be. The final product is 97%+ biobased, completely free of all California Prop. 65 chemicals of concern, EU listed fragrance allergens and is readily biodegradable. It has a toxicity profile that’s safer than the majority of hair shampoos yet cleans with the effectiveness of a conventional heavy-duty product, and its cleaning is driven by smart-targeting enzymes, so it’s gentler on fabrics.

Based on the merits of the initial formula, we were able to raise the initial friends and family round of funding through a SAFE note. It included one biotech VC as well as some notables, including actor Henry Golding, footballer Chris Smalling, and supermodel Soo Joo Park.

Generosity and belief in an impactful mission were the keys to starting this business.

We prioritized a science-based approach and believed that both how we formulated and our mission, inspired our manufacturing and supply chain partners to support us far above and beyond the norm for a company at our stage. In addition to that, having our own labs and R&D in-house really helped us keep our initial costs down for an undertaking of this size.

The launching of the initial products really ‘took a village.’ We worked with creatives around the world, including an industrial designer friend in France, creative talent in New York, San Francisco, Denver, Hong Kong, Los Angeles, and Portland. With travel being heavily restricted in 2020, we really needed the help of relationships and referrals to get all the components in place to gear up for our launch at the end of the year. During this time, we put a new supply chain and operating systems in place, finalized our branding, packaging, initial digital assets, and opened our web store in October.

we-created-a-240k-year-laundry-detergent

Describe the process of launching the business.

As I’m sure with any business, getting ready for launch meant a ton of deliverables for our team. We brought together a close team of chemists, a Head of Ops, and a Head of Marketing to align all the resources we would leverage to launch the brand. The initial thought process in the early days was to race to retail, but being a brand that was born during a pandemic, we decided late in our go-to-market plan to focus on our direct to consumer business to make certain that we got the product right and that we had a more direct connection to our customers to really understand their needs. We test all of our products in the lab, in third-party labs, as well as in the homes of several typical users.

We knew that a brand like Dirty Labs would need a decent amount of capital to build awareness for the brand, and we closed our seed round of funding in parallel with the soft launch of the brand.

Because of the collaboration involved with getting a brand as ours launched, we really saw a ton of support from the people and organizations around us. Our investors like Entree Capital, Vectr Ventures, and Bullish, as well as many other individuals and friends, were responsible for giving us the ability to really get behind the mission. We also were able to assemble an amazing advisory of leaders we really respect. They include Peter Rahal (RXBAR), George Shumny (Method/Harry’s/Olly), Lawrence Chu (Goodwin Law), Stuart Landesberg (Grove Collaborative), and Loren Brill (Sweet Loren’s).

The old saying that everything takes longer and costs more than you think it will, held especially true during a pandemic. It really takes the right alignment with the right partners - whether that’s a component supplier or an investor, to see you through the process if you want to do it right. I think this is really true for a new company at any time, but it’s definitely tested in times like these.

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

I think that there are a few things that have really helped attract and retain customers. I think a social trend towards smarter, more eco-friendly, and safe products has undoubtedly helped. For us, we wanted to win on a value proposition that while we’re a premium product, you gain both on the performance side as well as in sustainability, safety, and the convenience of a more compact solution.

In addition to the macro trends, I also feel that customers are likely to be brand loyal when they have a relationship with your brand and company. We put a lot of effort into being as transparent as possible about the formulation and components, and when questions come into customer service, those get answered by the core team, and often the chemists themselves for a detailed answer. We also really stand behind our product and I think the reviews of the detergents reflect how great a solution it is for a need that almost everyone has.

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

Today our distribution is just dirtylabs.com. With some paid advertising and word of mouth, the business has been growing at roughly 30% month over month. Due to the amount of content we create and make available on our site, we’re seeing website conversions in the range of 5-6%.

We will be launching our first major online retailer, Grove Collaborative, next month. We really felt that we were aligned with their mission, and believe that they will be an ideal partner for us. We have a smaller version of our bottle that we’ll be launching for them and it’s a 32 load bottle that is completely plastic-free.

With almost half of our team being chemists, we do have a lot of product concepts in the lab. We’re focused on the laundry category for the time being but do see a lot of natural extensions for our formulation philosophy for some time in the future.

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

Generosity and belief in an impactful mission were the keys to starting this business. Whether it was finding a fantastic co-founder or all of the core team or the countless partners we’ve brought in to help with the project, having people that belief in your mission has been critical.

The longer you can stay lean and the more things you can achieve on your own steam is extremely helpful during fundraising.

Whether that’s introductions or financial support or favors in getting better timing, costing, or customization, it’s been the one thing that really has made the company successful to date. I’m very grateful for all of their support.

What platform/tools do you use for your business?

We have spent a lot of time and energy figuring out the right tech stack for our business. Our e-commerce store is built on Shopify, which has some of the best built-in integrations. I had mentioned that we originally planned to go to retailers and pivoted to DTC.

This impacted our decision to use HubSpot for CRM and email, and we eventually pivoted to Klaviyo for email, which is probably one of the most powerful DTC email tools with robust integrations with Shopify.

We use Monday.com for project management and Slack for communications with our internal team and external partners which have been extremely useful in managing remote teams. We also just recently launched a subscription on our website with ReCharge. We’re continuing to build our tech stack based on our needs as we grow.

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

Cradle to Cradle was probably the most influential book on sustainability that I had read really quite early in my career. In the consumer electronics industry, it was really hard to envision how to reach a complete cycle. Even small improvements with products that are largely made from a combination of plastic, metal, and various coatings and adhesives make it very hard to disassemble and upcycle.

Most tech companies don’t really have materials R&D in-house, and typically sustainability isn’t a key KPI so eco-friendly solutions tend to be side projects that bring down-weighted margins and generally have fewer features and reduced durability. With Dirty Labs, we really wanted to put the science front and center to get as close to a closed-loop as we could. It’s why our young company has two labs and three chemists, and we’ve built in the costs for innovation into the business model. We’re not perfect, but it’s a part of our company’s ethos to continue to make progress.

Industry reports also are very impactful to me. It really reminds me of the scale of the problem we’re trying to solve. Today in the United States alone, nearly 40 billion loads of laundry get done a year. And while most people don’t think about where the gray water goes after it leaves your washing machine, we think it’s a significant shift to change from a largely petrochemical driven industry to a biobased one for the sake of our water supply.

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

I think that an understanding of what skills are critical for launching your business and taking an honest self-assessment of what help you need to get through the early stages is pretty critical. The longer you can stay lean and the more things you can achieve on your own steam is extremely helpful during fundraising and helps conserve capital towards costs you can’t avoid.

I see many founders that bring in friends onto their projects where their skills overlap too much. When a founding team isn’t able to collectively cover a number of their company’s initial needs, it leads to a pretty significant burn to fill the gaps, as well as leaves holes when investors examine their teams.

It’s pretty critical that founders put themselves in a mindset of being ready to learn. Whether that’s studying up on new skills or taking in information from their team members, investors or advisors, and customers, being open-minded really helps you adapt quickly as you learn about your business.

Are you looking to hire for certain positions right now?

As a young business, we’re continuously trying to manage agency/contractor work while building our hires. One priority area for us is to bring a strong performance marketer in-house. We already have a seasoned brand team and finding the right partner in performance is critical for us to scale.

Where can we go to learn more?

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

-  
David Watkins,   Founder of Dirty Labs
Pat Walls,  Founder of Starter Story

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