The Rise of the Beer Koozie Empire

This transcript was generated from the episode audio and may contain minor errors.

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Frustrated with the subpar experience of drinking warm beer, a college dropout creates a multi-million dollar insulated beverage brand. Hey, what's up? Welcome to Side Hustle School. My name is Chris Guillebeau. Did you know, by the way, that the world's oldest drinkable beer was discovered on a shipwreck in the Baltic Sea in 2010?

It's believed that the shipwreck occurred sometime between 1800 and 1830. Now, of course, beer itself, along with other fermented beverages, has been around a lot longer than that. But beer koozies are much newer. That's what we're gonna talk about today, the rise of the beer koozie empire. And at the end of the episode, I wanna address this issue of how to validate your product and market before you start, or should you even do that?

Because I often say that it's not super important or it's not the most critical thing when it comes to your side of soul. But in this story, the person took a different direction than what I usually suggest. So I wanna just kind of circle around and talk about why sometimes it matters and sometimes it doesn't. Again, the rise of the beer koozie empire. That story's coming up after this message from our sponsor.

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In 2016, Dylan Jacob was running Vichy Design, a company he started that sold subway tiles and mosaics. Around this time, he also started getting into craft beers. He loved the taste, but the beers always came in 16 ounce cans. Normally more beer would be great, but not in this case. By the time he got to the beer at the bottom of the can, it was warm and Dylan hated warm beer.

This sent him on a personal mission. He started researching koozies to find one to use for his drink, but found that there were none that would fit the size of the craft beer cans. His research deepened into the insulated drink market. No one was paying attention to what mattered to him, keeping alcoholic beverages cold. Dylan decided he was gonna solve the problem himself, naturally, and began working on his first koozie design.

But before spending any money, he wanted to ensure there was actually a market for it. He started his process by drawing up some rough sketches, which he then brought to a local engineer who helped him create a 3D version. From there, he headed over to one of the biggest breweries in his area to see if they liked the idea. They were impressed and agreed to try carrying the product in their gift store when it was ready. Dylan was feeling great about this start, enough to shell out a bit of money, but he wanted more confirmation before he went too far.

So he invested $3,000 into creating a 16 ounce insulated koozie he called the Hopsilator. The investment provided him with a hundred prototypes that he could release to the brewery store to get customer feedback. And the response was excellent. His initial batch sold out in two weeks. At the same time, he also bought some Facebook ads and designed a landing page using photoshopped imagery he'd created to showcase his idea.

When people arrived on the site, he asked for their email. Between the first batch of prototypes and those Facebook ads, he was soon collecting email addresses of interested drinkers. Even more confident in his product, Dylan decided to spend the next year perfecting his design. He made 13 more prototypes before acknowledging he had the perfect beer koozie. Not only that, but during the same time period, he created a second product, the wine salator.

And you'll never guess what that one does. It actually keeps wine cool. During the year of perfecting his product, Dylan continued to experiment with various marketing techniques. He tried creating a Kickstarter campaign. He did giveaways and even paid bloggers and influencers to promote his products.

He also spent 20 to $30 a day targeting different audiences using the same images and copy to see how they responded. And during that time, he discovered that his target demographics were different than what he initially expected. Thankfully, because he had been quick to release his initial prototype and willing to test different markets through advertising, it quickly became clear where to get more customers. Finally ready, Dylan officially launched Brumate the day after Black Friday in 2016. He marketed his product to be the perfect holiday gift and sold $250,000 worth of koozies between November and December of that year.

Dylan says this was due to perfecting the product and spending nearly a year focusing his marketing efforts on truly reaching and understanding his ideal customers. For the next six months, Brumate remained a one-man band. Dylan designed his own website on Shopify and watched YouTube videos to teach himself anything he didn't know how to do. He also handled all the customer service himself. He says now that the most important part of his business was making sure that he had a product people wanted and everything else came after that.

When he started, insulated drinkware was on the rise. We didn't have to explain his product to anyone. He sold the hops later for close to $23 and the wines later for $30 and had great success with both. As time went on, Dylan began to expand the company. He hired a social media team to continue to market Brumate on Facebook, Instagram, Google, Bing, Snapchat, Pinterest, and even TikTok.

Brumate now sells a variety of insulated beverage holders from champagne flutes to drink shakers to margarita cups. These efforts have paid off exponentially. In 2019, Brumate brought in $36 million in annual revenue and the company is on track now to making 75 to 100 million in 2020. And get this, this is Dylan's third company at just 25 years old. [Music]

Awesome, so what can we learn from this story?

Well, first of all, congratulations to Dylan. Huge, huge success. And I really respect the diligence and discipline of taking all that time to do that research. Okay, and that's what I wanna talk about here because what's the takeaway? I often say, I don't say don't do research.

I just say that research can be a tool for procrastination or research can be intimidating or research can actually hold you back from starting, right? And when it comes to validating a lot of the side hustle ideas that we hear about on the show, it would be very difficult to do that without spending a lot of money compared to just kinda starting it out and seeing what happens and adjusting as you go. Okay, so that tends to be more of my mindset. But I also understand that, you know, there are times when extensive market validation and research can make a huge difference. And that's what you see in this story.

So is the takeaway that I'm wrong? Is it just a matter of personal choice? You know, you do you, I think we can do better than that. I think the best way to navigate this situation for yourself when you think about your ideas is to be clear about your goals upfront, okay? So in this case, Dylan, despite his young age, he already had a fair amount of experience with starting businesses.

If it's your first one, if it's your first attempt here, or if you're really busy, you have very limited time, you know, for all the different reasons and constraints, limitations that I talk about, you know, those limitations and constraints can be your friend. They can actually help you move forward. So you might feel intimidated at all the steps he took to validate his idea and hone his target market over the course of a year. It was clearly worth it to him. I mean, a huge tremendous success here.

But if you have the choice of not starting at all, because it just seems so complicated, or if you're not trying to have a, you know, 36 million dollar business, you know, right away, which I totally understand, I don't have one of those, I think it's better to start and do as much as you're able without holding yourself up forever. So again, it's not just you do you, it's a little bit more about what are your goals, what are you trying to accomplish and achieve, and you should determine your course of action based on that. All right, friends, I hope you enjoyed this episode. Inspiration is good, but inspiration with action is better. Today's show notes, including links to "Broom 8," anything else I mentioned in the episode, will be at sidehustleschool.com/1296, 1,296.

I hope you'll continue to join me. I've got a different episode, different story, different questions and answers, dialogue, tips, tactics, strategies every single day, all about helping you create more freedom and security in your life. You can subscribe wherever you get your podcasts. My name is Chris Guillebeau, this is "Side Hustle School." [Music]

From the Onward Project.