Michael Lustig, founder of MEGGGA.com, wearing one of his creations.
Michael Lustig, founder of MEGGGA.com and a business partner of mine in ForeclosureJet.com took time out of his busy day to discuss his experiences as a GenY entrepreneur.
Scroll down to get the full audio & transcript. The interview is a little over 30 minutes long, so here’s a few gems:
On wasting time during start-up:
One of the biggest time sucks my partner and I experienced in launching this website was the “analysis paralysis” of getting everything perfect before we launched. The website took about three or four months to develop and we kept on going back to the design of the site, to the design of the home page, and to the design of the individual product pages and tweaking it. We became so focused on providing the best user experience that it definitely slowed down the progress of our launch and the time-table for our launch because we were just so concerned with having everything look perfect. It eventually just got to the point where it was necessary for us to just move forward and launch the business. All of the underlying processes that control the website, from the content management system to the shopping cart, it all worked. It was really just being comfortable with taking an idea that you want to be perfect and realizing that if you’re looking for perfection, you’re always going to find a flaw. You just have to accept that and put it out there and start growing your business on a tangible level.
On his motivation to be an entrepreneur:
I got into this and the other businesses I’m involved with because I want control over my life. I want to have the flexibility to do the fun activities with my friends and family when I want to do them. Being able to work from home or, just in a general sense, working at any location, that is really the primary motivator, because I can devote my life to my family, my friends, and the things that I really love to do in my free time.
On the importance of blogs:
I’d say the biggest aid that I’ve had from technology, doesn’t come from hardware or software; it comes from blogs. It’s from the blogs of other t-shirt designers that are involved in the industry, that have been around longer than me, those blogs that share that knowledge of their experience have been incredibly helpful to me. Being able to learn from other people’s mistakes and learn how a successful online business owner markets his product, produces his product, that’s something that has been invaluable to me and has saved me a lot of time and I’m sure it saved me a lot of frustration that I would have encountered if I didn’t do my industry research.
Reccomended Book: The Ultimate Sales Machine by Chet Holmes
Reccomended Blog: TED.com
Full interview audio:
Interview with Mike Lustig of MEGGGA.com – Lifestyle-Y.com
Full interview transcript (click below):
LS-Y: Hi this is Brian Smith here with Lifestyle-Y. I’m interviewing Mike Lustig today. He is the founder of MEGGGA.com, which is a t-shirt retail site. It sells custom designs which were designed by Michael and his partner in the business. He’s also a co-partner with me on ForeclosureJet.com. So we know each other quite well, but I thought because of his experience, he’d be a great person to interview and share some of his experiences as an entrepreneur.
Mike, How are you doing today?
Mike: I’m doing great, how are doing, Brian?
LS-Y: I’m doing quite well.
Let’s focus today on the MEGGGA website. We can get into ForeclosureJet some other time. I wanted to start out about you. What made you decide that you wanted to be an entrepreneur? When did you decide that you wanted to pursue this path?
Mike: Well I first started learning about entrepreneurship when I was in law school studying commercial real estate development. It was at that point that I learned about people putting a lot of time and effort up front to create passive cash flow producing investments that would yield a lot of benefits over time. After being educated with this kind of idea and philosophy, I started looking for other opportunities where I can produce passive cash flow.
LS-Y: So is that really your goal with entrepreneurship? To create passive cash flow.
Mike: Well, making money is a secondary goal – making money passively. The primary motivation behind entrepreneurship for me is the ability to have flexibility in my schedule and lead a location independent lifestyle.
LS-Y: Your ultimate goal with entrepreneurship is more lifestyle based, not having a massive company you can take to an IPO and then buy a private jet?
Mike: Yes, very much so.
LS-Y: Excellent.
With MEGGGA right now, how long ago did you decide to open the business, and when did you actually open it.
Mike: Well it all started as a hobby with my best friend, who’s also my partner, Ryan Hanser. He and I began printing t-shirts for ourselves for fun about a year ago. When ever we’d wear our shirts, we’d get so many comments that it just seemed to make sense, based upon all of the attention we were getting, that we could turn this into a commercially viable business. That happened about a year ago.
LS-Y: So at what point did you decide to actually start the business? When did the storefront open?
Mike: The storefront opened back in June – this past June. Up until that point – we started printing shirts for fun about a year ago. About in October is when we started getting serious about putting all the pieces together to figure out how we could make a commercially viable business out of what started as a hobby. A lot of that involved website development, what materials to use, and so on.
LS-Y: So now that you’ve been able to open the business, how long did it take you to make your first sale? You said you’ve been open since June, so it’s been two months, give or take. How did it take for you to make your first sale once you flipped the switch and turned on the website?
Mike: Actually, it only took about a week until we made our first sale online which was quite a pleasant surprise. We planned for the worst but expected the best and thankfully business is doing quite well right now.
LS-Y: How did you get your name out there? How did you get those customers to your website? How did you get the MEGGGA name out there?
Mike: Well when we thought about building our brand and spreading the word about our company, the primary tool we initially used was social networking. The main social networking site that we used was Facebook. Ryan and I have a lot of friends on our social networks and once the website was open for business we notified all of our friends. You know, all the people that we’re friends with on Facebook are our actual friends. We care for them, they care for us. So I believe that when we announced it to them, they had a legitimate interest and they checked out the site. Our friends told their friends and their friends told their friends, and it grew from there, quite virally.
LS-Y: Awesome. Have you undertaken any other types of marketing, beyond the Facebook approach? Have you tried anything and failed? What have you done other than access your immediate sphere of influence?
Mike: As for online, we did try a few different ad campaigns through Google; but, the problem with our shirts is that they’re very specific. For example, we make a shirt where we’ve taken the state of Florida, which I know you’re familiar with geographically, and drew a profile of a face onto it and you wouldn’t believe how much Florida looks like a mullet. It’s spot on. And this is applicable on many levels, as you know being from Florida. And so, we created a Google ad campaign advertising a mullet t-shirt, but the problem is people that are searching for a mullet t-shirt on Google aren’t exactly looking for something nice or fresh. They’re probably looking for something that you’d find in a novelty store. And that’s the real problem, because our designs are kind of strange, very specific, and after our analytical research on the keywords, it’s just not getting enough search traffic to warrant a continued investment.
LS-Y: Understandable, you’re doing something that’s very graphic. Having seen your shirts, I can understand why it’s tough to peg keywords to it. So, you mentioned the keywords as something that was sort of a waste of time. Was that the biggest time-suck, would you say? Or was there another avenue you went down that ended up really taking a lot out of you and really taking you down the wrong path?
Mike: One of the biggest time sucks my partner and I experienced in launching this website was the “analysis paralysis” of getting everything perfect before we launched. The website took about three or four months to develop and we kept on going back to the design of the site, to the design of the home page, and to the design of the individual product pages and tweaking it. We became so focused on providing the best user experience that it definitely slowed down the progress of our launch and the time-table for our launch because we were just so concerned with having everything look perfect. It eventually just got to the point where it was necessary for us to just move forward and launch the business. All of the underlying processes that control the website, from the content management system to the shopping cart, it all worked. It was really just being comfortable with taking an idea that you want to be perfect and realizing that if you’re looking for perfection, you’re always going to find a flaw. You just have to accept that and put it out there and start growing your business on a tangible level.
LS-Y: In hindsight, do you think that there was any foundation for any of those concerns? Or has everything really gone off without a hitch at this point?
Mike: It has. Those concerns about perfection were, in my opinion, misplaced. Because, like I said, we had our first sale within a week of the site going live, and we’re getting really good traffic and conversions now and the site, graphically and visually, has largely remained the way it has since launch.
LS-Y: So your recommendation to an entrepreneur would be, sort of the advice of Richard Branson, which is “screw it, let’s do it.” Let’s get started.
Mike: Well, yeah. Don’t over analyze things because that is going to put you in a rut. If you’re looking for perfection and seeking perfection, you’re going to get flaws. If you’re unwilling to move forward until you’re absolutely satisfied with everything, chances are you’re never going to move forward. You just have to pull the trigger and make it happen.
LS-Y: I agree wholeheartedly with that. It is tough when you’ve got an idea that’s perfect in your mind to actually get it to market.
Mike: Our shirts, our designs, this was our baby. This was something that we had cultivated and we care about, that started as a hobby. We wanted to share that enjoyment we feel creating it, and making it, and wearing it. We want to share that with everyone. Because of our commitment and passion for making these shirts, we wanted to make sure everything is right. It just got to the point where 95% of everything was right, and you just have to pull the trigger and move forward.
LS-Y: I know the exact feeling that you’re talking about.
Mike: I know you do!
LS-Y: So, you mentioned what took the most time and was the biggest time suck. What do you think had the greatest return on your invested time. What was the best time spent?
Mike: The best time spent was comparing apparel options. Initially we were considering printing on shirts that were less than the best. And when I mean less than the best, I don’t mean that they aren’t great shirts in terms of quality and cut, but they just weren’t the top of the line. Basically, we decided to go with American Apparel for a few reasons. One, they’re the market leader and all of the other shirt companies that were trying to compete with them were basically trying to emulate the style and fit of these American Apparel shirts. The second, more important reason, was that there was brand recognition behind American Apparel. One thing that I’ve experienced in the past has been going to an online t-shirt website, ordering a shirt that looks great online, and then receiving a shirt in the mail that doesn’t fit right and just doesn’t look right. It’s either a blown out heavy cotton tee, or it’s cut wrong. I thought that if I’m going to be selling a product sight unseen to a consumer, I need some way of ensuring quality. That will cause the customer to know that what they’re getting is going to fit right and last a long time. Through that American Apparel branding I felt that was something which was possible, because everybody in our demographic knows how an American Apparel tee fits.
LS-Y: And they recognize the brand. I think that’s a very insightful approach: leveraging a known brand in a very upfront and forthright way, not claiming that you’re something else or comparing yourself to American Apparel, but actually leveraging their brand and using it in your product and developing a level of trust with your customer by bringing them a product that they already are aware of. I think that’s a very insightful and, frankly, as you’re telling us, a very effective approach to business.
Mike: On each individual product page we have that logo right there. Basically, that logo ensures quality, in our opinion and it definitely has had a positive effect, in my opinion, on our level of conversion.
LS-Y: Yeah, and like I said, I think that’s a great approach to business. As far as money is concerned, you’d say that that was money that was well invested?
Mike: Oh, absolutely. The thing is, with these shirts, the main competitors of American Apparel that are producing shirts with a similar cut and quality, they’re definitely cheaper, they’re definitely way more cost effective. They’re about, I’d say, 60 to 65% of the price of an American Apparel shirt. But, being able to print on a shirt that has brand recognition, we were able to adjust our price point and keep the same margins that we were planning on having with the lower quality, lesser known shirts.
LS-Y: That’s interesting. As a brand new business you really didn’t have to cut prices to make those sales and you were able to build the value of the American Apparel brand into your margins, which is fascinating and almost counterintuitive in some respects.
Mike: Well it’s definitely been working.
LS-Y: Glad to hear it. Let’s move on to something a little more computer-based. What tech tools have helped you? You mentioned Facebook, has there been any other technological tools that have helped you at all?
Mike: Absolutely. I’d say the biggest aid that I’ve had from technology, doesn’t come from hardware or software; it comes from blogs. It’s from the blogs of other t-shirt designers that are involved in the industry, that have been around longer than me, those blogs that share that knowledge of their experience have been incredibly helpful to me. Being able to learn from other people’s mistakes and learn how a successful online business owner markets his product, produces his product, that’s something that has been invaluable to me and has saved me a lot of time and I’m sure it saved me a lot of frustration that I would have encountered if I didn’t do my industry research.
LS-Y: That’s a really good point that you brought up, really doing as much research as you can about the industry, about the mistakes and the triumphs that other people in your shoes have had but then not being paralyzed by that research, much as you had mentioned not being paralyzed by the over-analyzation of your website or other aspects of your business.
That leads me into my next question. You undertook the research, and you’re also a very well educated guy, you’ve got a good undergraduate degree, you’ve got a law degree, and you’ve got a masters degree as well. What aspects of your education do you think really helped you the most? What has been translated best into entrepreneurial skills?
Mike: In terms of my education, with my background in finance and law, I feel that I have a very good understanding of how transactions work. Being able to understand accounting, to understand what makes an investment profitable, to understand how to predict cost, and analyze feasibility and potential profit, those are all things that have been very valuable to me so far. On the legal side, understanding contracts and what makes a good agreement has also helped me and protected me from liability. But in terms of the most important thing, which I don’t have a formal education in, and which I’ve been figuring out through different books on entrepreneurship and sales and marketing, is, in my opinion, what do you do once you get the product. How do you get it out there. How do you get exposure for the product, reach the people who would be interested in the product, and convince them to then buy the product. That really comes down to marketing, communication, and sales. That is the biggest challenge that I have faced so far as an entrepreneur: not creating something that’s worth while, but reaching the people that want it and need it.
LS-Y: You had touched on previously kind of how you’ve done that. In addition to what you’ve just mentioned about your education, is there any personal skills or traits of your own that have really proven valuable in your business?
Mike: I think that being able to connect with people on a personal level is something that will always help the sale of a product. That’s something that we try to do on the website. We try to relate the humor that goes into the design to the consumer. On each different product page we have a little blurb about why we think this design is smart, or funny, or witty, and when you help bridge that gap between just a product versus a product with a story or an idea that someone can connect to, I think that is a very good way to increase conversion.
LS-Y: Absolutely. Being able to identify with the customer and put yourself in someone else’s shoes, is something that they really can’t teach in school and something that I know you’re good at. I’ve seen how your website is set up, so I would agree that’s a great thing that you’ve been able to translate into your business.
Now on the broader scope of entrepreneurship, how has your perception of entrepreneurship or being an entrepreneur changed from the time you started your business to where you are today?
Mike: In terms of my perception of entrepreneurship, I still love it, and it’s what I was born to do, and what I want to do, and what I need to do to be a happy person. But in terms of the challenges that I expected when I first started trying to operate this business, there’s just so many unexpected moving parts that go behind making an online business viable, and the key, in my opinion is understanding those moving parts and hopefully being able to outsource them eventually. That’s really my next step. Originally I wanted to micro-manage everything. Now it’s gotten to the point where I feel that my time and effort would be better focused on reaching more customers and connecting more customers rather than doing the day-to-day minutia such as shipping and balancing my books. Those are all things that I feel that I can outsource now. What I will say is, even if it’s easy for someone in a similar position to outsource those tasks, I would only recommend doing so once you have a really firm understanding of the process you’re going to outsource.
LS-Y: So, master it yourself before…
Mike: Master it yourself before you give it to someone else, absolutely. Because if you don’t understand exactly what’s going on, that’s going to hurt your profitability and the efficiency of your business, in my opinion.
LS-Y: I think that that is a great recommendation as well, because if you’ve read the 4 Hour Work Week or anything like that, it’s exciting to start thinking about jumping the gun and handing running your business over to someone else. But what you’re saying is don’t do it too quickly, because you can end up really hurting yourself.
Mike: Or stifling your progress, at the very least.
LS-Y: Those are great points. So you’ve touched on how your perception has changed a little bit, but have your goals changed at all since day one?
Mike: The goals have remained largely the same. I got into this and the other businesses I’m involved with because I want control over my life. I want to have the flexibility to do the fun activities with my friends and family when I want to do them. Being able to work from home or, just in a general sense, working at any location, that is really the primary motivator, because I can devote my life to my family, my friends, and the things that I really love to do in my free time.
LS-Y: So, as you had said before, it’s a certain type of lifestyle you’re trying to achieve, rather than a lump sum of money, or a certain car, or something like that.
Mike: It’s definitely a lifestyle thing for me. I think the most valuable commodity is time, and if you have time and money then you have the best of everything. So why not try to make money on your own time?
LS-Y: That’s a great way to put it. So you’re talking about where you’re looking to go, and assuming you haven’t reached your ideal level of success, what is keeping you from that at this point? Or are you well on your way?
Mike: I’m on my way, and my partner and I in MEGGGA are experiencing a really good level of success right now. But the real challenge is how to reach a new level of customer; how to reach as many people as possible. That really goes back to communication and marketing, and what I really feel is inserting yourself into the flow of culture. Once you’re able to get your product and your ideas into the culture stream where people are not only aware of it but excited to talk about it and excited to spread the word about your product and your ideas, that’s when the business can really take off. That’s when it gets pushed along that culture stream to many many more people that wouldn’t normally come across your product or idea.
LS-Y: It’s really turning your customers into advertisers.
Mike: Exactly, and I feel the best way to do it is to deliver the highest quality product that people connect with emotionally.
LS-Y: And to be passionate about it, which I know for a fact that you’re passionate about your products.
Mike: Very much so.
LS-Y: Just to wrap it up, for entrepreneurs or budding entrepreneurs, do you have one book and one blog that you would say stands out above the others and recommend for them to take a look at?
Mike: As for the book, I would highly recommend the Ultimate Sales Machine by Chet Holmes. Like I mentioned earlier, I don’t have a formal education in marketing or sales and that book, the Ultimate Sales Machine, really gave me some great ideas in terms of how to become a better sales person, how to get my ideas better disseminated, and how to connect with people on an emotional level that increases conversion. I can’t speak highly enough about this book, it has taught me alot and it’s great material.
LS-Y: It is a fantastic book. I agree with you 100% on that.
Mike: As for a blog, my recommendation isn’t so much of a blog as just a general website. TED.com is one of my all-time favorite websites for inspiration. Basically, for people that are unaware of this site, TED is an organization that brings together some of the best and brightest and most talented individuals in the world, and asks them to give presentations about how they succeeded, the challenges they faced, and how they overcame those challenges. Watching some of the most intelligent people in the world explain how they solve problems and how they generate new concepts is really something that has inspired me and turned on my creative switch. I cannot recommend it more than enough. It’s just a fantastic website.
LS-Y: I do enjoy poking around on TED as well. It’s a great website. I want to thank you for your time, I know it’s your most highly prized commodity. I wish you the best of luck with MEGGGA and thank you for sharing your experiences and your insights to current and budding entrepreneurs who happen to come across and listen to this interview.
Mike: Well I’m glad to share what I know and I’m always looking to learn more new things, so I encourage the people who listen to this interview to share their comments and their ideas and what they know on your website.
LS-Y: Well I appreciate that, I would ask them for the same thing. You did it for me! Thank you very much, Mike. Anybody that’s listening be sure to check out MEGGGA.com and buy a couple of shirts!
