On this episode of Honest Ecommerce, we have Shizu Okusa. Shizu is the Founder & CEO at Apothékary We talk about crafting a better-for-you wellness brand, maximizing data-driven marketing, seizing a Shark Tank opportunity, and so much more!
Shizu Okusa is the Founder & CEO of Apothékary, a plant-based farmacy that couples traditional medicine with modern day ailments, offering natural alternatives to over-the-counter drugs and beauty products.
The company was established in 2019 and has since expanded their business beyond the US and now in 22+ countries worldwide.
In This Conversation We Discuss:
Resources:
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Shizu Okusa
Historically, wellness is something that you buy for yourself because it's so personal. You don't really know what to gift a friend in terms of their health needs.
Chase Clymer
Welcome to Honest Ecommerce, a podcast dedicated to cutting through the BS and finding actionable advice for online store owners. I'm your host, Chase Clymer. And I believe running a direct-to-consumer brand does not have to be complicated or a guessing game.
On this podcast, we interview founders and experts who are putting in the work and creating real results.
I also share my own insights from running our top Shopify consultancy, Electric Eye. We cut the fluff in favor of facts to help you grow your Ecommerce business.
Let's get on with the show.
Hey everybody, welcome back to another episode of Honest Ecommerce. I've got a fun one for you today. We already got into too much fun stuff before we started to press record so I just had to stop us in our conversation.
I'm super excited to welcome to the show, Shizu Okusa. She is the founder and CEO of Apothékary. Welcome to the show.
Shizu Okusa
Hi. Thank you, Chase, for having me. I really appreciate it. I'm really excited to be here.
Chase Clymer
Oh, I'm excited to chat. So for those that are unfamiliar with the brand, can you quickly just talk about what types of products you guys are bringing to market? What are you selling online these days?
Shizu Okusa
Yeah, sure. So Apothékary is what we call Mother Nature's Pharmacy. It's very simple. We are Mother Nature's Pharmacy in that we provide clean, natural, herbal, eastern remedies as an alternative to western over-the-counter stuff.
We're talking melatonin, laxatives, energy drinks, coffee, wine, literally everything that's a very quick fix and really getting to the root cause of illness to get you to everyday healing.
Chase Clymer
That's amazing. Now, take me back in time.
Where did the idea for this business... Did you start with business or did you start with a product? Where did this start? What was going on?
Shizu Okusa
That's so funny you say that. It's true, right? It's not just necessarily always a business that you start with. You start with a product or maybe a solution for yourself personally that then you turn into a business.
For me, I originally started my career at Goldman. I was in Wall Street for my first job and I think there was a series of no’s throughout my life that got me to the yeses later in life.
And so when you're early on in your career, I think you do and try so many different things. I was in Wall Street and I was like, “This is definitely not for me,” but I did distressed investing for about three years and learned so much about bankruptcy and so much about how to run a bad company to then run a better company.
After three years, I then started my first company, which was called Jrink, J-R-I-N-K. It was a cold press juice business and I did that for eight years. We scaled it to like 15 storefronts, Whole Foods partnership, retail growth.
But again, I didn't really wanna be a restaurant owner of 15 stores, because we were making smoothies and juices and all that. So we got acquired in 2019. I was very fortunate to start my next company.
I've been in wellness as an entrepreneur for about 12 years at this point, and Apothékary kind of really started when I had my aha moment of walking through the aisles of CVS and Walgreens. And it was very clear to me that A, everything was in plastic bottles, in pill form, with ingredients that we don't recognize. You just kind of realize that this shift in better-for-you food and grocery hasn't happened in pharmacies.
And so that was kind of my first aha moment. Then I went home and bought all these herbs from my juice shop and started to make these smoothies for the other company that were super food dense, using food as medicine. Again, this is like 2014, ‘15. This was long before food as medicine became a clear trend.
But after 2019 kind of happened and I was trying to formulate and think about how everybody in the world is probably shifting towards better-for-you medicine and better-for-you supplementation, that's really when this aha moment happened.
And I said, “Okay, let's start in a real apothecary that has existed at least for 5,000 years in Eastern medicine and bring that in a very Western approachable and accessible way.”
And so we were born in January of 2020, right before COVID. And we can kind of talk about that. I think for a long time, actually, it's just a crazy journey. Yeah.
Chase Clymer
I think that unfortunately, COVID is going to be a topic of a lot of the podcasts that I have because it is such a growth moment or such a lightning in the pan moment for some brands to get out of that flywheel and stuff. And I really want to get to that.
But first, I want to talk about you launching in January of 2019. What does that mean? Do you go to market one product, you have your first drop and how long were you working on this beforehand?
Shizu Okusa
Yeah, so the Ecommerce launch was in January of 2020. But before then, in 2019, we were bootstrapping a fundraiser and we opened a storefront. We actually opened a mini store as a concept. It was very witchy. It was very crystals and skulls and palo santo and herbs, kind of like a very old school witchy apothecary.
But we at least learned that customers wanted that, and they wanted these products. We had five products. We had a ‘slay all day’, ‘chill the F out’, ‘follow your gut’, very basic adaptive jinglings and we kind of coupled that with some retail offerings.
That was how we kind of mirrored the UX and the experience that we would have digitally. So like, what questions people were asking, how they were buying, what they were looking at–we mirrored that for the Ecommerce site before we officially launched that in January of 2020.
But again, we also did a rebrand this past July. So that was not really the perfect iteration when we first launched either.
Chase Clymer
Awesome. Let's talk about that launch and launching into COVID.
I know there are a lot of listeners out there right now that are about to launch or they have launched, and the age-old question is, how did you get your first customers?
Shizu Okusa
Yeah. We were pretty fortunate that we had that store originally when we opened. We always think about proof of concept for others to buy.
It's so simple, selling Ecommerce and selling a product. One is like, get someone to buy it, get them to buy it again, and make them tell their friends to buy it. That's literally it.
That first piece was already done with the store. So getting them to then buy again digitally was the second piece, and then getting them to tell their friends digitally to then come back to Apothékary.
So we really doubled down on a referral. We doubled down on retargeting and we really, really doubled down on email. That was really our first real marketing push and it continues to be to this day, to acquire first-party data.
So emails, SMS became a later thing. But emails were always the number one thing of how we grew our marketing funnel, and then creating lookalike audiences to get more of those similar people. And that flywheel just has continued to make us grow over the last four years.
Chase Clymer
That's amazing. So you took the data that you're getting from people in person in that first store, then you used that in building out your lookalike audiences in the first launch?
Shizu Okusa
Yep. Yep. Exactly. Yep.
Chase Clymer
That's amazing. And very detailed to the point where people... This is how it works sometimes. It's that simple.
Shizu Okusa
It's quite... I mean, it's quite simple in terms of buying behavior. But in practicality, I think most people go directly to pay and kind of guess their demographic. But I don't... I think I've been pretty surprised with our demographic. It's much older than people expect.
We're like in the 40s to 60s. It's like the core demographic. It's not the millennial, gen Z that I think everyone may assume.
Chase Clymer
So let's talk about post-launch. So you launched this, COVID happens.
What does that do to the business? And where does COVID end up for you?
Shizu Okusa
Yeah. So we were two and a half people in January of 2020. At the end of December 2020, we were 18 people. That might not seem like a huge growth in absolute numbers, but it was a huge struggle to get the people and meet them and then understand the remote culture and period in general, because we were always kind of an in-person team and then all of a sudden, totally isolated.
We now fast forward even to today, we're fully remote and we have employees in the Philippines, Taiwan, US and Canada. Completely remote and we really embrace that culture.
But for the initial sort of 2020 launch in COVID, I mean, our facility was in Virginia. I was living in New York, and I couldn't even get back to DC at the time or back to Virginia. And so there was a constant FaceTime and how to pack the orders, how to scale up the production because we were doing fulfillment also in-house.
So we didn't have a 3PL either. But I think that actually saved us because what happened was in May of 2020, when people really got shut down and locked in their homes, that's when the company exploded.
That's the time when people were like, we need to buy everything and anything that is healthy to make us feel good and potentially save us from COVID.
And we literally like, I think we grew 20x overnight. And we didn't actually have a clear understanding of how that happened literally overnight. And then that continued to happen through 2020.
And then 2021, after the iOS changes, a lot of things had changed at that point.
Chase Clymer
Absolutely.
I've been lucky enough to interview a lot of brands on this podcast. And during the pandemic, you saw a lot of explosions in certain categories that go directly to just psychology and Maslow's hierarchy of needs.
And so safety was one of the first ones there. People need to feel safe. And obviously, you saw a huge growth online with anything that had anything to do with being healthy.
Shizu Okusa
Yeah. It's so true. That's actually really true. I think we quickly knew though, towards the end of 2020, there were different trends happening. It wasn't just about health, it got very specific into mental health.
And I think even to this day, the mental health piece has continued to be such a big part of this business that people didn't really even talk about yet in 2020. I don't think we talked about the mental health impact and stress of working from home and overworking until later in 2021.
Chase Clymer
Absolutely. Well, you saw this explosion in growth.
How did Shark Tank come into the picture?
Shizu Okusa
Yes. Oh my god. So Shark Tank reached out. They originally do their screenings in January or February, and so this was pre-COVID. I applied and I was like, “Oh, it's totally fine. I'm never gonna get interviewed.” I totally assumed nothing.
And then April came around and they were like, I got a random email, “Hey, Shizu, we want you to submit your pitch again.”
So that's how Shark Tank works. It's like you pitch yourself to the producers to show an entertainment value or that you can pitch and you have some entertainment or personality.
So of course I was very audacious, and pitched this video over video. And then fast forward in August they were like, ‘We want you to come out.”
Because LA was in shutdown, we actually got flown to Vegas and Vegas was where Shark Tank was filmed during 2020 of COVID.
So they took out the entire hotel of the palazzo and we were isolated in our hotel rooms for 11 days. Literally no joke, 11 days. You could not escape to just go outside to get ice. You had to be in your room. There were no COVID tests, you just had to be isolated.
And so that experience was kind of crazy because we were doing the display, trying to figure out where everything was going to go, all virtually and through FaceTime. Then understanding like the production of the day and again, through FaceTime.
So we pitched officially in September, I think it was the 13th. I still remember this to this day, it was a Sunday at 5 a.m. I went downstairs and we pitched to all four of the sharks and we got two offers.
It hasn't aired to this day, I don't even know if it'll ever air, frankly, we never know. And they'll just email you like two or three weeks prior.
But we were fortunate enough that we got two deals and it was an opportunity that I'll truly never forget. I think I collapsed on the floor after the entire show filming was done. It was an hour and a half. But they cut it down to 15 minutes. It was crazy.
Chase Clymer
Yeah. It's been interesting to learn so much about Shark Tank. And you think it's just like these things are dialed. It's 13 minutes and they're just throwing out money. It's like, you know, a whole episode takes a very long time.
Shizu Okusa
It does. Yeah. And the diligence on the after effect is very light. We had like one or two emails and that was it.
Chase Clymer
That's amazing.
It's interesting to me that you wrote this email and your pitch worked so well without what I notice from the show is they're always asking about, like, “That sounds great. What about the numbers?”
So what numbers did you have? Was it all projections on the first round? Obviously, things had changed on the second.
Shizu Okusa
Yeah, it was all projections. It was kind of like because you were also growing so fast, by the time that this would air, I’ll actually feel really horrible because I remember at the time we were pitching for a $5 million valuation and we were asking for like 250K, and we got that deal.
But then after I got off the show, I remember being in such regret that I was like, “Did I just give up X percent of my company knowing that our revenue that year was going to be five, not the valuation should be five?”
And so I felt horrible. I remember that. But luckily, looking back, we didn't actually sign anything afterwards. You don't have to sign anything. It's not an obligation.
It was like an entirely life experience and I feel very fortunate to this day to have had that experience. The photos and the videos and it's more for the team than anything.
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Chase Clymer
You've had some very unique experiences with your business. Let's talk about getting hacked.
Shizu Okusa
Oh my god, I love this. So that actually happened a month before Shark Tank.
This was in August of 2020. And by the way, I actually moved to California during COVID time because when I was filming for Shark Tank, I just decided to stay out there.
But in August of 2020, we randomly… I was still running Instagram because again, we were, like, three people at the time. And then one day, I couldn't log in and I checked the hi@apothekary.co email, which is like our customer service email.
And there was like one email in there that's from Instagram saying your username changed, and then another email that says your email has changed to your Instagram. And usually now, when that happens, you can log in and just confirm if that was you or not you.
But back then, by the time I did that, they already changed the email on me, so I couldn't even confirm that it wasn't me. Then when I went to Instagram, our account was gone. And I think like an hour later, we got an email from a random Gmail account. It said Annie Hirla, HIRLA.
I was like, “Who is this?” And it said, ‘Held for Ransom’. That was the subject line. Great subject line: Held for Ransom. It said, ‘We want a hundred Bitcoin in exchange for your account,’ and there was a screenshot. I'm happy to send this to you because it's hilarious. I still look back on this.
There’s a screenshot of our account in black and in Russian. It had our account in Russian and I was like, “This is crazy.”
And I called any friends that I had from the Pentagon and DC, and I was like, “What do I do? Is this worth me paying?” Because we had 60,000 followers already at that time. And that's no joke. It was literally my sweat and blood of everyday posting. It's social proof. It matters.
We ended up not paying, and then we ended up not getting the account back. I don't know, one way or the other, what the right answer was, but I had to just trust my gut instinct that I don't know if I'll ever see this money again. And I'm glad that we never got back.
But to this day, I still get random people emailing me that they got hacked and wanting advice. I think Instagram at this point now has seen enough of these cases that it's become common play to give it back and ensure this doesn't happen.
But back then, we were one of the first companies, two factors really wasn't a thing, now it's everywhere. But yeah, that was also part of PTSD accumulation.
Chase Clymer
Yeah, I think that the main takeaway here is if you are a social first-rate, make sure you have 2-factor turned on for everything.
Shizu Okusa
1000%. Yes, 1000%.
Chase Clymer
Oh, that's amazing. So let's get back to the business. We talked about these fun stories.
So you guys are growing rapidly. You do Shark Tank and that honestly doesn't even have a factor because it never airs.
Let's go back to how you are growing the business. Are you guys focused on direct consumers? Does the in-person experience still exist anymore?
Chase Clymer
Yeah, absolutely. We're three and a half years in from all that craziness and we've had a number of continued craziness over the years.
But looking back, it's made this company so much more resilient, coming out of the pandemic because we've seen so much around shipping and port delays. And all of our ingredients come from Asia or abroad, so it's not necessarily all domestically made.
I think what we've learned over time is diversity in terms of supply chain, diversity in terms of co-packers, diversity in terms of employees, just in everything. So I think to this day, three and a half years later, we're looking to do around 25 million in revenue this year, and it's been a crazy experience to kind of get there.
Our team is like 45 people today and we've made plenty of mistakes, both on hiring and expenses that we probably didn't have to do. But I think our flywheel now after many experiences and tests is finally concrete–it's always focused on email and owned media. And then we layer affiliate and PR on top of that. And then obviously paid.
But the paid isn't always… it’s never efficient without all the other top of funnel stuff. The top of the funnel is always a question mark after iOS has changed, and so we layer on top affiliate and PR and that's been such great social proof.
Then the email and the earned help with the middle of the funnel and then paid is kind of like the conversion focus.
That has been sort of like our natural sales funnel cycle now to this day. And we have about, I think, 600,000 emails and about 100,000 SMS people to this day. And it continues to grow through the holiday season.
So yeah, that will always I think be a big part of what we do.
Chase Clymer
That's amazing. And one of the first things that we talked about before we started to record was obviously, we're recording this the day after Cyber Monday 2023. and you said that there were some interesting things that happened just this week.
Shizu Okusa
Yeah. So historically, wellness is not really a gifting product. Historically, wellness is something that you buy for yourself because it's so personal. You don't really know what to gift a friend in terms of their health needs.
What we are seeing this year though, we're seeing 170% year over year growth just through this Black Friday-Cyber Monday weekend, and what we're seeing is people are gifting wellness, which is a major trend and in my mind I was like, that says so much about the consumer and where they're at and how they're spending now.
Because if you're gifting wellness, it comes, I think, a little bit more thoughtful than just buying someone's socks or like a hat or another backpack. It's something that people use to take care of themselves, to cut out alcohol, to focus on your stress and your sleep.
So it shows a lot of depth and thoughtfulness that I don't think necessarily in the past we have seen, but if anything, it's an early indicator for our January, because January for wellness is the biggest month. It's a new year, new you, and so it comes at a very big moment for us.
I think from an operational capacity, we've completely kind of broken the facility. There's just boxes. There are boxes everywhere. Everywhere, everywhere. I'll show you a photo and video after. It's kind of crazy.
Yeah, but we've hit new records and we're very proud of the team.
Chase Clymer
Well, no, I'm excited for your growth as well. We've talked about quite a lot today.
Is there anything I didn't ask you about that you think would resonate with our audience?
Shizu Okusa
I always think the fundraising environment is such a top of mind thing for founders. I’ve invested in 12 early-stage companies to this point and I think everyone is fundraising right now. It's a really challenging environment.
And I would just say that you should have a very clear focus on who you want to get investors in because the historical, ‘Please send my blurb around’ and BCC everyone does not work anymore. I think it has to be very one-on-one, like, ‘Please send this to Chase because Chase has this, this, and this experience. And I think I could really get a lot of value from him as an investor.’That'll be much more likely to convert.
And so you have to think about your fundraising strategy, almost very similar to your sales strategy for the consumer acquisition cycle. I think of that as just general founder advice for anyone looking to launch a brand and kind of get some money in the door and be really strategic also about debt capital.
Chase Clymer
Oh, that's amazing advice. Shizu, thank you so much for coming on today and being one of the most honest guests we've had thus far. I truly appreciate it. I'm sure we'll have you back next year or something like that.
Where should people go if they're curious about this product that you are so passionate about, if they want to go check it out and support you?
Shizu Okusa
Yeah, absolutely. We have some great products. We have Stop Your Whining, which is our number one skew right now. All on apothekary.co. Apothékary with a K.
You can also find me and the company on social media at Shizu Okusa or Apothékary Co. Thank you so much.
Chase Clymer
Awesome. And we'll link to all that stuff in the show notes below. Thank you so much.
Shizu Okusa
Of course.
Chase Clymer
We can't thank our guests enough for coming on the show and sharing their knowledge and journey with us. We've got a lot to think about and potentially add into our own business. You can find all the links in the show notes.
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