Bootstrapping a Niche e-Commerce Company to $10 Million: iHeartRaves CEO Brian Lim (Part 3)
Posted on Wednesday, Aug 8th 2018
Sramana Mitra: Are there any strategic nuances that you could share of how you were able to do that?
Brian Lim: Social media was big here. We were able to broadcast our message to the right folks. We had a good ground game where we were meeting fellow glovers and ravers at these music events. We were able to build a following through social media and get people to our website and store.
Sramana Mitra: I guess the question that I’m wrestling with is, how do you manage the inventory financing with that kind of fast growth in a bootstrapped company?
Brian Lim: It was really just reinvesting the profits. I did not take outside money. We funded it literally by profits.
Sramana Mitra: In other words, there’s nothing else that you did other than just funding inventory with profits.
Brian Lim: Yes, I didn’t have any outside funds available. Banks would not lend to me. My parents were in nothing but debt. They were about to lose their house. I have no rich friends. I really had no other source of funding my inventory other than with profits.
Sramana Mitra: In terms of customer acquisition, what was your most effective channel or most effective mechanism?
Brian Lim: In the early days, social media marketing was the most effective way. We would be able to post on Facebook and reach 100,000 to 200,000 people with every single organic free post. Today, that’s no longer the case, but we were able to build a social media following and promote anything that we wanted.
Sramana Mitra: Facebook is your most active customer acquisition channel?
Brian Lim: In the early days, yes.
Sramana Mitra: This is paid Facebook advertising?
Brian Lim: No, back then there was no paid advertising on Facebook. This is all organic.
Sramana Mitra: You created a Facebook page and it was organically propagating. Facebook’s algorithm was helping you until they changed the algorithm.
Sramana Mitra: Did you suffer from that Facebook algorithm change?
Brian Lim: Absolutely. Those were the great Facebook days when I could reach 200,000 people for free. Today, I’ll be lucky to reach 1% of the followers to our fan page. Our new customer acquisition strategy is primarily paid.
Sramana Mitra: It has really been a complete change in that landscape. There were some people who were able to take advantage of that early free opportunity for a few years. Then it all changed.
Brian Lim: I see it as a cycle. There’s always a new platform that’s also free that people can jump on and get their business started. Instagram became the next big one. As long as you’re able to evolve and adapt to the tools of your time, you’re able to get good free traffic.
Sramana Mitra: What are some of the free sources of traffic these days?
Brian Lim: I wouldn’t say email marketing is free, but it’s still the most effective. We have lots of different strategies to grow our email list. The other ways are social media. Organic is still a big strategy for us because we have to create great content that our audience loves. It’s a testing ground for what kind of content our audience loves so we can further boost those types of posts with paid advertising.
This segment is part 3 in the series : Bootstrapping a Niche e-Commerce Company to $10 Million: iHeartRaves CEO Brian Lim