We hit a 100 million annual revenue run rate at 11 months. Groom did it in 22 months, right? And they were acquired for 1.2 billion. A1 took them 10 years to hit 100 million. We hit 200 million run rate in 18 months.
All right, Danny, welcome to the show, man. Why don't we start off? Why don't you give a little intro to yourself? So, who are you? What do you do?
Hey, Sean. Thanks for having me. Quick background on myself. Always been an entrepreneur. Started working at a very young age at 15. I was a telemarketer. So that's how I got started working. Age 24 had my first business, was a restaurant. Did that for three, four years. Then ventured into the hotel furniture business, import export from China into the US. Eventually worked on some big projects like the MGM City Center in Vegas. Did that also for three, four years. Then in 2010, I took a leap of faith and moved to Hong Kong to launch an e-commerce company that was doing group buying. And then when Groupon went international, they acquired 51% of my company. We became the largest e-commerce company in the region. I left in 2014. We were doing about 200 million annual revenues. I had a good exit. That's where, you know, I made my first million, per se.
But then after e-commerce, I was like, hey, you know, what do I do next? Had a lot of options at my disposal and I didn't just want to go back into e-commerce even though that was the easy route for me. I ventured then, I actually, you know, got started in diagnostics and DNA testing. So founded Prenetics, which was a life sciences DNA testing company. And again, this was 2014, right? So very early, no one was really talking about this stuff. And I think you'll see that in my entrepreneur career, it wasn't the obvious choice, but everyone's like now looking back is the obvious choice, right? I mean, think about in 2010, no one was using e-commerce in Hong Kong. Everyone in fact told me to go back to the US. They're like, Danny, just go back to the US. This model is not going to work in Hong Kong. We made it the number one e-commerce company at the time. But going back to Prenetics, you know, started as a life sciences company. When COVID hit, you know, we were in prime position to take advantage of it. We worked very fast. In two weeks, we got our COVID testing kit. We then became Hong Kong's number one COVID PCR provider as well as in the UK. So those three years, I would say we were like printing money, I would say. Right.
At one point, we were doing 40,000 PCR tests a day, right? We total did 28 million. This is laboratory PCR tests. Those three years, we did 700 million plus revenue. In three years' time, we listed on the NASDAQ in 2022, where household name, everyone that arrived in Hong Kong at one point had a mandatory Prenetics PCR test. And then of course that leads into, you know, IM8, which is kind of, you know, what happened after COVID. You know, we had a billion dollar valuation during COVID in 2022 because COVID was still going on. 18 months later, our market cap hit, I think it was like 50 million, right? Went from billion plus to 50 million. You really know who your friends are at that point, right? Because at a billion...
You got a lot of friends at a billion, and a lot of friends that are billing...
Okay. The stock's down 95%. Were the friends also down 95% or it wasn't so bad?
No, I mean the friends wasn't down 95%. But when you're going up, everyone wants to be involved, which is natural to be fair, right? Everyone wants to be surrounded by winners, but very few...
Want to be surrounded and associated when you're going down, right? Because I think the path...
To recover is significantly much harder. I mean, we had a few options like, you know, why don't we just close the business? Because you have to think about the background, right? We, I think in 2022, yeah, we did, you know, 272 million revenue, right? And basically 40 tests turned to nothing, right? So basically, you know, our revenue dropped by 95%. And to be fair, I think the market, you know, realized that and was rightfully valued. So we thought, okay, what do we do? You know, do we close up shop, just return capital to our shareholders? You know, do I do something else? I mean, of course, I've been successful as an operator as well as investor, right? So a lot of options still. But you know, I knew that, you know, I still wanted to create something out of this and also wanted to be very responsible to the shareholders from before. Coincidentally, at the same time as we were thinking what to do, you know, I had the opportunity to meet with David Beckham. And this was right at the same time where I was thinking about getting into the supplement category. And when I met David, you know, it wasn't to like pitch him on, hey, let's get into the supplement category. We were just having a conversation about his background, what he's doing, and he was very intrigued about my consumer background as well as my life sciences background. And he was telling me, you know, about his problem, him and Victoria's problem about how even for where they are as individuals, and of course, you know, they have all these resources available to them, right? They even found the supplement category very overwhelming, especially that when they're traveling, you know, they just can't maintain that routine of taking 12, 13, 14, 15 pills and these capsules and etc. They just don't do it, right? And then me as an entrepreneur, like, hey, I'm sure there's a better way for that. And yeah, after, you know, three to four months, countless conversations, as I'm sure you can imagine, and someone with David's pedigree and background, if something went wrong, it's not no one cares about Danny. It's always going to be, hey, David, something blew up, right? So he had to take...
And I told David from day one, hey David, I know, you know, for the last 30 years there's been so many people wanting you to do this category and you reject it. And I told David something that was surprising to him. I was like, David, if we do this together, I don't want you just as ambassador. I want you as a co-founder, but this brand has to live beyond you. I don't want this to be another celebrity brand.
Yeah. So let's explain what IM8 is, right? Because that's the current business. So if I go to the website, I see Beckham, I see Giannis, I see Lily Collins, I see a bunch of famous people and they're drinking a little red drink. And you know, so if you've seen it, most of the supplement category is green, you guys are red. And it's some sort of supplement drink, longevity drink. You got the Beckham stack on here. And can you explain just in short, like, you know, just real quick, like what actually is the product that you sell?
Yeah, so we've made the business model very simple. We came out with our daily ultimate essentials and it's very simple, right? It has 90 ingredients, replaces 16 different supplements in a powder shake. You mix it with 12 ounces of water. You just drink it every single morning and it takes care of your foundational nutritional needs. So what does that mean? All of your multivitamins, your CoQ10, MSM, probiotics, prebiotics, postbiotics. And because normally you would have to take the equivalent of 16 different supplements, that will easily cost you $250 to $300 on a monthly basis. And for us, we're selling at $90 on a monthly basis, this combination, which also tastes great and you can carry around with you everywhere.
Right. And you guys have been, I mean, you're a public company, so you're public about your numbers, but you've talked about your numbers before. Yes. This, you're only about a year into this product line, right?
We're only 20 months in. We only launched December of '24. Right. And you know, now we've been the fastest growing supplement brand you ever recorded.
What does that mean? How fast are you growing?
We hit 100 million annual revenue run rate at 11 months. In this category, I mean, Kruans did it in 22 months, right? And they were acquired for 1.2 billion after three years. AG1 took them 10 years to hit 100 million. We hit 200 million run rate in 18 months.
So you're at 200 million a year. So there's two angles to this, right? I have my ecom nerd hat because that's been in e-commerce and I can ask you about the funnel and the CAC and all that. Then there's just like high-level, you know, product market fit. When a product hits a nerve and you've nailed the positioning, the branding. You've nailed something in category and positioning. Can you talk to me about category and positioning? Because I think those are highly underrated and most people are terrible at that and it's very hard to recover if you have category and positioning wrong. You can be the best at just trying to crank the grind the funnel, but it just doesn't matter if you haven't gotten that first key decision right. Can you talk to me about category and positioning?
Oh, do you see that? I just stepped over a million-dollar problem, a million-dollar business idea. And that's the thing, most people walk by these million-dollar ideas all the time and they don't even notice. And so our friends at Starter Story, they put together a list of 90 business ideas. Each one is vetted. They're all real problems, real gaps in the market because they talk to hundreds of entrepreneurs and they put together this amazing stuff that's incredibly well researched. And so if you want to find a bunch of amazing business opportunities, you can get it for free. Just scan the QR code or click the link in the description.
Even before, you know, we got into this category, everyone told me not to do this. They're like, hey, supplement category, highly competitive, so many bad eggs. And to be fair, I mean, I can tell this story now is that, you know, my whole board disagreed with me, right? They're like, you don't know anything about supplements, Danny. It's true, too, right? I didn't do anything in this category before, right? It was e-commerce, selling coupons, DNA testing, running the lab, all that stuff. But also to be fair, before any of that, I never had a background as well, too. Right. So, but of course still, you know, the board was like, you know what? And then we have to make, of course, a commitment with David Beckham. It was not a small commitment. Correct. And then so they disagreed with me, but you know, I knew that if we made a great product and we've nailed the positioning and the brand, right? And with the support of DB, you know, this would be a home run. So I had to really fight and educate my board. And again, it's like, hey, you know what? If I'm wrong, I'm going to resign. I'm going to, you know, quit, right? That was my position because I really needed to be convinced myself that this was the right move.
But what made you think that this would be the right move? Because it is true. Supplement category is crowded, right? Like a lot of people have a celebrity. Who cares, right? Like...
Correct. And a lot of celebrity brands fail, right? They're like my board tell me there's so many, there's actually more failures of celebrity brands if you think about than actually success cases, right?
So my take was, number one, everything starts with the product, right? Everything starts with a better product than what's available in the market. And I can honestly say, yeah, we have the best product in the market. But like you fairly pointed out, consumers may not recognize that, right? And so this is where from day one we spent more time also on the taste profile because a lot of times people have the great product, blah, blah, blah, etc. But if it doesn't taste good, no one's going to drink it, right? So I spent a week at the factories, that's every single day testing like, you know, 20, 30 different flavors until we got that taste like, ah, you know, this taste is good, right? And that wants to drink again. But those two things, those two also doesn't, you know, relate to success, right? So you mentioned the color, the brand. We wanted this to stand out. We didn't want to just create another greens powder, right? Then no one created a reds powder, right? And so I think by default...
That was interesting to people.
Is it red because it's like made of beets or it's red because you made it red? Like, you know what I mean? Like did it need to be red or you chose to be red?
It was a natural coincidence that when we created the formulation, there was like beets inside the formulation and this was a natural red color and then like, let's just go hard on this color. Right.
Right. Which then made sense.
And then our packaging, if you look at it, is a very big red box, right? It's very premium, the positioning. So I didn't want just to be another supplement brand. I wanted to have a really great unboxing experience. It's bold. The name, you know, easy to remember, the fonts, the colors.
How'd you come up with the name? Because, you know, whenever I brainstorm company names, you get 500 names. Each one you look at, you're like, that could be it. And then, you know, so like if I had written down on my list of supplement names, IM and then the number eight. I might have, maybe it would be like, oh, that kind of flows, but I wouldn't have the courage it takes to pick such a weird name. Where's that come from? Why that name? How'd you know?
Very good in names, right? I would say I'm like really good in names. I mean, my e-commerce company is called You Buy I Buy, right? Group buying, right? With that just the number you. Then Prenetics was prevention and genetics. So you have Prenetics, right? And then of course IM8, it came, I wanted something simple and easy to remember. And then IM means I am. And then eight, if you flip it around, means infinity, infinite possibilities, right? And I knew at one point we'll enter China and the number eight will also work in China. Right? So there's definitely...
Lucky number of China, right?
Number eight means, it's like I am is like I am healthy, I am strong, I am powerful, right?
So there's a great meaning behind that. Okay. And so you go into this category now, you get your formulation done. What's the zero to one? So what did that look like? You just fire up Facebook ads, Shopify store. Did you do anything else? Like what does zero to one look like?
Zero to one again, the formulation part, you know, I would say was a result of also getting an amazing scientific advisory board. Yeah. Again, when I looked into this, it was like, okay, what are all the different challenges someone can... Yeah. And it's like, hey, just because we have David Beckham, it's not enough. And everyone knows David is not a scientist, right? I'm not a scientist, right? So then the next step was recruiting a world-class scientific advisory board, the likes of Dr. Don Musum from Mayo Clinic. James Green, the former chief science of NASA. Suzanne Decoda, the director of microbiome at Cedar Sinai. So these individuals we brought along, they all took part in creating this formulation and that wasn't enough.
And how did you do that by the way? That's, um, what, you're cold emailing? Is there a... I actually know there's like a brokerage service. I don't know if you know this one. There's a brokerage service between doctors and supplement brands that literally it's like get a doctor on your brand. I don't know if you've seen this. I haven't seen, like a very niche agency some guy has. But what did you do? You cold called these people. You go fly out, meet them, you expect me. What's happening?
I knew the former chief of science of NASA prior. Yeah. Basically, he was at NASA for two years. So that was easy because he knew me, right? And again, a lot of these relationships is built on trust. And you know, for Dr. Don Musum, I contacted her on LinkedIn, we got on a call. And again, the first time we had it, she was very skeptical because so many supplement brands, you know, reach out to them. And again, especially as if you're a practicing physician, it's also quite rare to work with a supplement brand, especially if you're, let's say, with Mayo Clinic, really rare, right? Because they have a lot of restrictions, etc., etc., right? So...
But I think from day one, even I told Don, yeah, we're still working today very closely, is that we need to prove the science and evidence. Yeah. So that's why we embarked on a clinical trial before we launched the brand. We embarked on third-party testing by not just one organization but by two, by Eurofins and NSF certification for sport. So that means if you're a professional athlete, you know it's free from 280 banned substances.
So I have a lot of friends who are in the supplement game and in general when you're in e-commerce, it's easy to become very skeptical and very jaded, of course. Not because anybody means poorly, but just because it's very easy to get something up and running and put all your effort into the packaging, maybe even some into the taste, but ultimately, you know, you're not in the factory and also it's very easy to have something that might help, but is not scientifically proven, right? Scientifically proven is a very high bar. And so I would say there's almost two parts of the ledger. There's the first part which is like, are these clean ingredients and is it made in a clean factory? That's kind of like trust test number one. Trust test number two is what the hell is a postbiotic? What's a prebiotic? Does any of this stuff actually matter if I drink this? Does anything really change in my body? And I know obviously I'm asking, you know, the priest if religion is real. But I guess like if I'm a highly logical, rational person, what would be your most convincing thing you could tell me that would make me actually believe in supplements?
A lot of supplements out there don't work and that's the reality, right? And I think the best validation of our product is that doesn't matter who we have, Beckham, blah, blah, blah, etc., our business won't be in 20 months, can't be a 20 million, 200 million plus business without recurring subscriptions. And that means the product works as advertised.
All right. And the best... how does someone know that the product works? How does the customer know? You'll feel it. And the best way to... energy. What are you feeling?
Better energy, recovery. Yeah. You sleep better, your gut. Yeah. Everything is working better. Yeah. And of course, a lot of these individuals, these are CEOs, athletes. I think the best case I can show you. I mean, I was surprised by this email, right? Around last April or May of 2025, right? I got an email from Aryna Sabalenka's team, right? Co-email into me, right? They're like, hey, you know, Aryna's been on your product for about three months now via a recommendation from her nutrition coach. When you're the world number one tennis player, every single thing they're measuring your recovery, how you're feeling three to four times on a daily basis. And they don't need a... I mean, she has so many options and resources. And she's like, hey, she's been feeling amazing from a recovery perspective and she hasn't gotten sick while on the product. Given that they're traveling, you know, different time zones every single week, can we partner together, right? And then so that was a great validation of the product working at the highest level of sports. And the reality is also every single ambassador that came after that was inbound to me.
Hey, let me ask you a question. Is the market in China or India for that matter, like two big population places, is the supplement market the same? Is it just the same but 10 years ago? Is it different or what's going on over there?
India, to be honest with you, I don't know. I do know it's a much lower price point in that category. In China, they do have AG1, but it's not like, yeah, from what I understand, it's not doing well.
Why do you think that is? Is it all just price point or is there another factor?
I mean, again, it goes back, you know, to price point, education, branding, positioning. You know, there's like so much, right? I think to be fair, 99% of American companies go into China and think they can just succeed with the same business model. And for China to operate it successfully, you need a completely different business model, completely different team. Like for example, my team can't do China 100%. There's like no hell, there's no way they can do China, right? So for me to enter China, I would need to get a completely new team of every single individual, right?
Tell me about some of the operational excellence. So I want to know what are some things that you're doing that I could look at that I could be inspired by. Oh, that, you know, the way they do that, that's really good. So now I'll give you a couple examples. So we had Chad from Gruns on the podcast and he was showing us their funnels, their Facebook ads. We were looking at his ad library together and they were showing like he's got like, you know, there's eight different sort of reasons to buy, right? Maybe you're on Ozempic and you want Ozempic support. Maybe you're looking for mood and here's a mood thing. Maybe you're a woman and your hair's falling out postpartum, whatever. I don't know what they're, I don't remember the exact angles. He's like, I've got like the ad that goes to the landing page for that persona, for that problem, for that sales pitch and I'm running all eight simultaneously. Whereas most entrepreneurs are, you know, usually just get fixated on one and they don't get as much of the market. He would tell us that. Or Eric Ryan from Method Soap and Olly Gummies came on and he's a master of packaging and positioning and he said I was looking in the vitamin aisle and you know, first thing I knew was that every container was round and so we would be a rectangle. And he's like, it's as simple as that. I look for a sea of sameness and everywhere in the aisle that I see a sea of sameness, I know there's an opportunity to come in and do something different. That's what they did in Band-Aids and soap and vitamins.
Yeah, I would say even right now, you know, to be fair, wise, you know, the ads and landing pages, personas, that's quite standard operating procedure right now, right? If you're a DTC brand doing $100 to $200 million, I mean, you have to be doing that, right? I think for us wise, I think one thing that we've done really well was scaling on Meta ads. You know, right now we have anywhere from, you know, two to three thousand ads live at any given time. We're testing out, you know, 500 to 800 creators on a weekly basis. So it's that constant testing that is really, really important, right? And you have, and right now the reality is even with ad buying, I mean, you know, ad buying is like a commodity right now. Yeah, before a few years ago, you have to be really, really good at ad buying. But now Meta does all of that for you already, right? You don't need to do the targeting. You don't need to do all this stuff, right? All you need to really figure out is how do you get really good creatives and really good creative diversity on the different personas because now you need a creative to do the targeting. And...
So tell me about that creative machine. So you said two things. You said you have a couple thousand ads running at a time. So are those like statics or those videos?
Statics and videos, I would say is about, you know, 55, 60% statics and then the rest videos.
And you're doing that with what, a studio? You're doing that with AI? What is the machine that's building all that?
A combination of everything. So we have our own ambassadors. Yeah, again, we have, of course, we have like top 10 very famous ambassadors. Then we have another thousand or more or so ambassadors, affiliates that are creating lots of content for us on a daily basis, right? And that feeds the engine depending on whichever personas that we're going to. And a lot of times you have your proven winners and then it's like how do we recreate all these proven winners because, you know, there's also creative fatigue that happens, right? So we have our own creative fatigue score that we identify. So we know, okay, when an ad is potentially going to get in fatigue, which then ultimately will drop that ROAS. Right, again, 300,000 above on a daily basis on Meta, you know, which is quite high given that we're only 20 months in, right? And we've been able to...
And I think one key thing, again, public information given we're public companies, that if you look at what happened in Q2 versus Q1, Q1 our CAC was 305, right? Our average order value is about $230, right? So, and we doubled our marketing spend in Q2, right? We doubled it from about 17 to $33 million in a quarter, right? Our CAC actually went down by $4, right? From 305 to 301 because you would imagine if you're doubling spend, your CAC's always going to go up. Yeah. Right. And then so I think we reached a point where again we got the engine running. The brand is also doing very well from a brand position and we've ran now 200 plus offline events. I think this is something that I haven't seen any other supplement brand do.
And why are you doing that? Because that creates content or because that creates loyalty or both? What's the main reason to do 200 offline events?
I mean, it's very important from us from day one. This is about an authentic product, science. And, you know, when we have these events, we have our scientific advisory board members there. They're talking about the product, right? And again, this is not just a marketing aspect. It's, you know, we have real science behind the brand. They get to meet our formulators and our scientists and doctors. Last week in New York, we did like, yeah, seven events in seven days, right? As part of US... I always say these events are very difficult to scale, right? But I think that's very, very important, especially in the age of AI. You don't know what's real. You don't know what's fake or whatever, right? And then so I think having that offline presence is really important for us.
Yeah, and I think that's pretty counter to where most brands are right now. I think it's so easy to sit at your laptop, fire up ads, you know, tweak your landing page. And clearly, you get the scale, you get to measure it, you get every, you get the feedback loop right away. You don't have to like go get face rejection out in the real world. And it almost means that like offline has this disproportionate premium because it's simply like less contested. And once you've had an in-person touch point and then you go see an ad, right? It's going to be a completely different experience than if you've never...
Brand and I attribute that CAC lowering when we double our spend. We're not talking about like a lot of doubling a lot of spend, right? And even July our CAC fell to $239, right? You know, which is, you know, we're spending more than $10 million a month on marketing, right? And then so it was continuing to lower, but I do believe again, I don't have quantifiable data to say this is all offline, but I'm going to continue to double down on offline events because that's really important to the brand side of things.
