Blake Mycoskie is hyper aware of the difficulties founders face when starting and scaling businesses during crises — he created TOMS shoes in 2006, shortly before the recession, and launched his latest company, wellness program Madefor, in early March as the US began its battle against the coronavirus.
His experience underscored the importance of building companies that are culturally relevant, and using customer testimonials to spread brand awareness.
When Mycoskie appeared on the season 12 premiere of Shark Tank, he was the only Shark who is currently running a new startup in the pandemic.
"It gave me a really unique perspective to be a Shark right now because I'm building a company during the pandemic as well," said Mycoskie, whose new venture Madefor helps users build better habits such as drinking more water, reducing phone use, and increasing movement through a wellness kit that includes virtual community support and physical tools like an hourglass or water bottle.
"That made a big difference in terms of me connecting with entrepreneurs," he said.
Mycoskie spoke with Business Insider and shared his entrepreneurial tips for enduring the pandemic, scaling on a budget, and preserving mental health (hint: it involves scented candles).
Lean into what your customers are feeling
Founders who want to build a cultural connection with customers and understand how they're feeling should start by seeking insight from their friends, family, and employees, Mycoskie said. While market research can point to trends and consumer behavior, there is more nuance to be gleaned from people close to you, he added.
What's more, asking employees how the company can pivot to address customers' feelings and acting on those suggestions will build loyalty and energize the staff, Mycoskie said.
Focus on getting through the short term
Founders who are pitching investors during the pandemic should show how their companies will grow in the short term rather than the next couple of years, Mycoskie said. In previous years, entrepreneurs could use research to predict how their markets would develop but today's world is more uncertain given the global health crisis, he added.
"Right now, we don't know what's going to happen," Mycoskie said, referring to the future of industries like travel and live events. "Businesses that can perform and work right now are the ones that are getting investments."
Cut through the noise with personal messaging
Mycoskie launched Madefor in early March when coverage of the pandemic overshadowed everything else. Today, he says, it's the same with the election.
Instead of pouring money into marketing and advertising, he asked customers to share their Madefor experiences with friends and family. The tactic is cost-effective and helped Madefor build a strong internal community. What's more, it was easier than trying to blindly target potential customers on platforms such as Instagram and Facebook, he said.
Reconsider raising money from investors
As the founders of fabric cleanser GarmaGuard were leaving "Shark Tank" without a deal during the premiere, Mycoskie was tempted to make them an offer. However, he felt they didn't need an investor.
A piece of advice that Mycoskie wasn't able to share on "Shark Tank" is that founders should only raise funding from investors if they absolutely need money. If the founders' goal is to develop personal wealth, they're better off "owning more and growing slower rather than growing faster and earning less," he said.
Mycoskie noted that he didn't partner with investors when building TOMS, which meant he was able to retain 100% of his business. He sold a 50% stake to Bain Capital for $300 million in 2014.
Quantify hiring decisions
Founders who are hoping to grow their business on a budget should consider whether any new hire will generate enough revenue at the company to pay for themselves, Mycoskie said.
"I like to tie every single employee, especially in the early days, to a metric," Mycoskie added. "If I paid a person $100,000, I'm at least generating $150,000 a year of cash flow."
Founders should focus on hiring people who will drive money to the bottom line immediately and tell employees up front how their performance will be measured, he said.
When all else fails: nature and candles
Mycoskie has been researching the benefits of spending time outdoors and how it can help improve his mental health. While it may not seem feasible for most founders working long hours to take a lunch-time stroll through Central Park, there are other ways to incorporate nature into your daily routine.
For instance, lighting a nature-scented candle can trick a person's mind into thinking they're outside, he said. "It doesn't have to be as much as you think," he said.
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