Growing a Hemp Oil Business to $70,000/mo in the First Year

Channing Thanks for taking the time to do a joint interview! Mind letting us know about your backgrounds and what you do at Populum?

Gunhee Park, co-founder of Populum

My name is Gunhee Park, and I'm a co-founder of Populum. My background is in operations. I worked at a tech company in Austin, TX, for a couple years before teaming up with Ola to start Populum. I currently lead operations, sales, and customer service.

Ola Olusoga, co-founder of Populum

My name is Ola Olusoga, and I'm also a co-founder of Populum. My background is in design and marketing, and those are the areas I lead at Populum.

Gunhee

To briefly introduce who we are — Populum is a premium hemp oil brand. Hemp extract supplements have gained a lot of spotlight in the past couple years as the chemical compounds in hemp have been found to be essential to our bodies. By using high-quality ingredients and working with US farmers and certified PhDs, we're delivering a transparent and premium product to customers seeking the benefits of hemp.

We officially started selling earlier this year, and we quickly experienced some major growth. We've gone from a thousand dollars in monthly sales to $70K in monthly revenue in July. Here's a snapshot of our sales growth in 2017.

Channing What motivated you to get started with Populum?

Gunhee

After a couple years working corporate, I really wanted to quit my job. I knew I wasn't going to be happy climbing up the ladder, and I was getting sick of the bureaucratic nightmare that comes along with working in a big corporation.

It was a scary thought to quit — cutting off your bi-weekly paychecks and constantly fearing the "what if I fail" scenarios. But after learning about the hemp industry, and with the opportunity to team up with Ola, I decided to give it a try. We bootstrapped the company with our combined savings, and we grew our business by continuing to reinvest our profits.

We got passionate about starting Populum after learning more about hemp. We were fascinated to discover why so few people actually know about this plant, even though it's one of human history's oldest cultivated crops. It's because in recent history, hemp has been stigmatized and suppressed by the government, often being portrayed as the same thing as marijuana. (It's not.) So we wanted to do something about this — not only to disrupt the hemp industry, but also to help expand the hemp market to more customers.

Before we even had the vision for Populum, we did months of research on the benefits of the hemp plant. What we found was that hemp extracts, mainly known for cannabidiol (CBD), have amazing benefits that most of the public is completely unaware of. But even with such potential, we found there to be a complete lack of information and transparency regarding these products.

This poses a big challenge for customers, a large portion of whom are looking to buy hemp oil as a supplement for themselves or for their loved ones — spouses, children, and even their pets. So it's critical that they can trust the quality of the ingredients and have confidence that the company stands behind its products.

We started Populum with these things in mind. Our primary goal was to create a high-quality hemp oil sourced and made right here in the USA.

Channing What went into building the initial product?

Ola

Getting our first product out the door wasn't an easy task. We benchmarked other hemp, cannabis, and even mainstream supplement brands to give us an idea of what was out there. This also helped us figure out how to differentiate ourselves.

While Gunhee was working with manufacturing and operations partners, I was diving into the branding of Populum. We didn't know it'd be called "Populum" yet, but we spent a good week texting names back and forth until we landed on something we felt sounded right. This was all around the start of December. We gave ourselves a month to complete everything — the branding, product images, product development, copywriting, etc.

Once we settled on the name Populum, we set off on sprints to get our website and product done.

The first sprint was deciding the brand voice. That is, the color palette, typography, imagery, logo, etc. We started with a few options and felt great about where we finally landed by the end of the week.

Week two focused on the product images. Once we had the prototype from the manufacturer, we created a super crappy light booth using an online tutorial, and started taking pictures.

Week three focused on the website design. Before diving into the front-end code, we used Sketch to create the pages of the website so that we could iterate on the designs and have conversations about them.

In week four we put it all together. We'd already purchased the domain and set up hosting. We chose to use WordPress as the base CMS, since it's easy to manipulate and does 90% of the engineering work for you. We chose a theme called Kalium and went to town on building the site.

All together it took a good four weeks to launch, while managing the manufacturing aspect of the business in parallel. We were able to get all the product images, branding, fulfillment infrastructure, website, emails, etc. all in place before New Year's Day.

For the truly curious, here's a quick rundown of most of the products that helped us get through the sprint:

• Sketch and Photoshop for design
• Slack for communication
• Asana for project management
• Dropbox for file sharing
• Dropbox Paper for notetaking
• WordPress as the CMS
• DigitalOcean for hosting
• Namecheap for the domain
• Gmail's G Suite for business email

Channing How have you attracted users and grown Populum?

Ola

Having a background in design, one thing we aimed to do was stand out through our branding. We knew that having a quality product wasn't enough. In today's marketplace it's not enough for you to have good customer service, a quality product, and be fairly priced. You also have to look great.

A huge competitive advantage lies in the perception derived from a quality brand, so we made sure we nailed that. Today people expect visual quality. You can see that in brands like Airbnb, Facebook, and Apple. They evoke a feeling and have personality. That's what we tried to focus on — using visuals to show trust and quality.

Parallel to design, another area we put a lot of emphasis on was customer service. We knew that hemp oil is a relatively new and foreign product for a lot of people. Many of them have simply never heard of it or used it before, which can make them that much more hesitant to try it out. We help customers overcome this uneasiness through a 30-day risk-free trial — a first in this industry.

Through this policy, we're letting our customers know how much we believe in our products, and how much we care about the user's experience with our brand.

Referrals were another big area of growth for us. We realized that after customers used our products and shopped with us, they enjoyed sharing their experience with friends and family. We wanted to encourage our customers to continue to do so and to also thank them for letting others know about us. So we started a referral program that's simple and straightforward. And this word-of-mouth marketing has really helped us capitalize on organic growth.

Channing What's your business model, and how have you grown your revenue?

Gunhee

We're a direct-to-consumer brand, selling directly on our website and also through Amazon. Being in such a controversial industry, starting the company and growing the business forced us to think more outside of the box.

There are still a lot of regulations and stigma around this plant. Payment processors like Stripe refused to work with us. Facebook rejects promotions and ads that focus on hemp. Google also blacklists accounts that use adwords to promote. So from the beginning, we've had to find unorthodox and alternative ways of getting our products out there.

What helped us the most early on was using organic traction strategies, such as word-of-mouth and reviews. We worked with review sites to get our product tested, engaged with online forums, such as Reddit, by being active on their discussion boards, and also did free giveaways to get people to experience the supplement.

At first, all these methods were painstakingly manual and non-scalable. But our goal was to gain an initial set of true fans and let the product speak for itself. Overall, these manual traction strategies paid off for us. To this day, we have no ads that direct traffic to our website, but we have seen continuous growth in our traffic. Here's a snapshot of total sessions on our site (per month) over the course of this year:

Eventually, we also got approved to sell on Amazon, and that's really helped our sales to take off. Amazon's unbiased reviews have helped customers trust our product, and we've been able to utilize their platform to spread awareness about hemp oil to a wider range of customers.

Today, our sales are split almost exactly 50/50 between our site and Amazon, with our monthly revenue at $70K.

Channing What are your goals for the future?

Ola

We've gotten some amazing feedback on our products, and it's been gratifying to see our hemp oil help a lot of people. One of our main goals is to accelerate the awareness of hemp oil among the mainstream by becoming the market leader in the industry. In order to effectively do this and to make it easier for customers to try hemp oil, we realize that our product selection needs to improve.

Taking a supplement as a tincture, where you place drops of liquid under your tongue, isn't the ideal method for all our customers. Quite a few potential customers who get turned off by it. So our goal is to be an innovator and develop more varieties of the oil, like topicals that you can apply like lotion, or capsules, or even oil-infused candy.

As a bootstrapped company, our goal is to manage our growth and to reinvest our profits to continuously improve our quality, our operations, and our product offerings. We plan to soon diversify our distribution by working with retail outlets, such as health stores and clinics.

Channing What would you say is the biggest roadblock in front of you?

Gunhee

The biggest roadblock for everyone in the hemp industry is government regulation. In the past, hemp extracts were categorized in the same pool as marijuana. This confusion still exists today.

There's actually an ongoing lawsuit right now where stakeholders in the hemp industry are seeking to get some clarification, because the DEA has come out with statements that have caused more uncertainty. How this case gets resolved will have a huge implication for us and for everyone in the industry.

Channing If you had to start over, what would you do differently?

Gunhee

Starting off in a taboo industry, a mistake we made early on was being overly cautious in our approach. We were really conservative in validating markets and distribution channels. We would constantly doubt whether something was allowed or if we should go ask "industry experts". Throughout the past year, I've learned that this thinking was wrong.

For example, we've been told we can't sell on Amazon. We've been told there's no way to market our product, since platforms like Google and Facebook prohibit it. We've been encouraged to "consult" with the hemp industry experts, as they know best.

Eventually, we decided to go against the conventional wisdom of our industry — and this is when we started winning. I think that's a valuable lesson for entrepreneurs entering any industry. We created Populum to make a positive difference in this industry and accelerate its growth. With that in mind, everything we do should be to challenge the status quo and change it.

Channing Have you found anything particularly helpful or advantageous?

Ola

Having backgrounds in tech helped tremendously. But there was a lot we had to figure out and learn as we went. Both Gunhee and I are avid readers, so we took these opportunities to dig into areas we weren't familiar with.

For instance, when we first got started, we weren't really adept at digital marketing, so we googled "Best books on marketing", and ordered the books that kept reoccurring in the results.

Here are some books that we learned a lot from:

• Traction by Gabriel Weinberg and Justin Mares
• Lean Analytics by Alistair Croll and Benjamin Yoskovitz
• The Lean Startup by Eric Ries
• Running Lean by Ash Maurya
• The Conversion Code by Chris Smith
• The Brand Gap by Marty Neumeier
• Ultimate Guide to Facebook Advertising by Perry Marshall and Keith Krance
• Ultimate Guide to Google Adwords by Perry Marshall and Mike Rhodes
• Influence by Robert Cialdinni by Robert Cialdini

You name a book and we've either read it or placed it on our to-read list. We strongly believe in digging deep into books to learn via other people's experiences, and then applying those learnings to what we're doing. This way we know the terrain and aren't caught off guard.

I'd also say the biggest habit/skill we have is being open minded, quick learners, and adaptable. We're comfortable with uncertainty and know nothing is guaranteed, so when something goes wrong, we're able to take a step back, analyze the situation, and change course.

Some books that have helped with that include:

• The Black Swan by Nassim Nicholas Taleb
• Antifragile by Nassim Nicholas Taleb
• Contagious: Why Things Catch On by Jonah Berger
• Predictably Irrational by Dan Ariely
• Thinking, Fast and Slow by Daniel Kahneman
• Sapiens: A Brief History of Humankind by Yuval Noah Harari

Channing Where can we go to learn more?

Gunhee

Please visit us at populum.co to learn more about our hemp oils. You can also read customer reviews about our products on Amazon.

If you have any questions or feedback about Populum, please leave us a note in the comment section below, and we'll respond as soon as we can. Thanks!