Fueled By Death Cast Ep. 131 - CHAD RUBIN
CHAD RUBIN - CEO OF SKUBANA
"I like to do these things and get myself out of my comfort zone and just get out of that prefrontal cortex and just get into other parts of my body." Chad Rubin, co-founder and CEO of Skubana
ABOUT CHAD RUBIN:
Jeff: I really want to start kind of at the beginning of Skubana. Skubana was born out of a necessity you had, correct?
Chad Rubin: Yeah, absolutely. I come from the eCommerce world for the past decade.
Jeff: Walk me through that a little bit. I know you started eCommerce. You started a company, correct me if I'm wrong, it was called Crucial Vacuum.
Chad Rubin: Mm-hmm (affirmative). Correct.
Jeff: What was that all about? Was the literally a vacuum company?
Chad Rubin: Yes. My parents owned a vacuum store. Think back to if you've ever been into a vacuum store, my parents had a vacuum store and Walmart opened up right next door. So, growing up we would have to pinch pennies together to pay the bills or to pay the mortgage and I was like I never want to be an entrepreneur and I never want to be in the vacuum industry. Sure enough, I'm an entrepreneur and in the vacuum industry.
Jeff: You failed on both accounts.
Chad Rubin: Exactly. Exactly. I actually went on, I was first generation college grad and I went on to Wall Street. I ended up covering internet stock so advising hedge funds and institutional investors to buy, sell or short internet stocks. I notice that there was this thing called Amazon that was growing and they built this marketplace and I started helping my parents sell their wares on Amazon across with many other channels on eCommerce.
Jeff: Wow. That was pretty much at the tail end of the internet boom there, right, early 2000s you were doing that?
Chad Rubin: I got laid off Friday the 13th, 2009 but I had started doing that in 2007 kind of moonlighting and then finally survived three head cuts, was laid off and started helping my parents full time. Sure enough my father passes away and I start my own direct to consumer company where we started manufacturing our own home appliance parts and accessories and selling them direct to consumer.
Jeff: So, you kind of fell into entrepreneurship without ever even looking towards that. But, you fell into it and you went both feet forward which is commendable. But, then you get to a point where your company now that you're working for, scaled beyond your means, correct?
Chad Rubin: Are you talking about the eCommerce business or Skubana?
Jeff: eCommerce. Just before you started to come into the Skubana.
Chad Rubin: Yeah. It was scaling. I had 35 employees and you guys are well aware of some of the pain points that I struggled with. We essentially started eating in our own restaurant. We started dogfooting and building the software for my own needs but also building it for many other large eCommerce brands needs that were ripe in taking over these incumbents very similar to Death Wish Coffee.
Jeff: Incredible. So, you're actually creating the groundwork for Skubana without ever ... It wasn't like you set out and you're like, "Okay, I've been doing this company for a while and now I'm going to start this other venture." You just literally did it out of necessity and were building those things, those pieces in your existing company, correct, before you ever even started Skubana?
Chad Rubin: Yeah, no, you know what, we were struggling with trying to unify our business in one place that allowed us to scale. I tried every software on the low end. There was a lot of higher end software's that would have taken us a long time to deploy. I met serendipitously my business partner, DJ Kunovac, and it was introduced to a friend of mine from college. Long story short. He came, he saw the problem and we started to work on that problem. But, we actually always had the idea that we wanted to use the software for many other people beyond my own needs.
Jeff: So interesting. Now, for our listeners and viewers at home who might not be in the entrepreneurial space or the eCommerce space, what is the layman pitch for Skubana from you?
Chad Rubin: Layman pitch is it's a back end operation software to run and automate your business.
Jeff: Right. That's like your warehouse, your logistics, all of that stuff.
Chad Rubin: Yeah, exactly. Some people listening they're powered by coffee, well, Skubana powers large brands and retailers to run their business all in one place.
Jeff: That seems like such a needed thing in this industry. Was it hard from the get-go? You come up with this idea. You start implementing this. Is it hard to get businesses to want to use your product in the very early stages?
Chad Rubin: As long as I'm always under the impression that if you solve a problem people will come to you. In other words, instead of trying to find customers we started building an audience. People started coming to us. I would be talking about a lot of the challenges that eCommerce merchants are facing and people would just be like, "Oh, wait, this guy has something really smart to add value into my life with. Yeah, let me check out Skubana because I have those same pain points."
Jeff: Incredible. You're creating a solution to an existing problem with this brand new venture Skubana. But, as anybody knows starting a new business, starting a new idea always has its own obstacles. What were some of the obstacles early on with Skubana that you had to kind of navigate through?
Chad Rubin: I would say the first obstacle is I wasn't aware of how big of a software this was going to be. I just wanted it to be an inventory app and DJ, my business partner, he was like, "No, you need to be a unification platform. Everything, so order management, inventory, purchase orders and profits so the scale and the complexity increased significantly since when we first started the company.
Chad Rubin: And then on top of that the other piece I think that's very important to note is in eCommerce you guy low you sell high. In software, you have to build, build, build and then bring it to market and continue to build through the lifecycle of your product. Your product is a living, breathing thing that you constantly have to maintain and also to grow. Software is a very different beast than a traditional produce business.
Jeff: Interesting. Now, you said early on you were consulting for the internet boom on the stock market and you've been in companies that are eCommerce and handle a lot with software. Do you have a background in software creation? Are you drawn to the tech side of things? Are you a techie?
Chad Rubin: I think the reason why I was really interested in Skubana is that we're only here for a very short time on this planet, and you want to make sure that you're positioning yourself to spend time on things that really challenge you and that also can have the most, the biggest outcome for yourself along with your family.
Chad Rubin: For me, I saw Skubana as a challenged I wanted to solve. I'm not a software guy. For me I just like to build things. I like to see them grow. I'm a gardener. I like to plant seeds. I like to water things and watch them develop and grow and that's exactly what we're doing at Skubana. By the way, my eCommerce business still is running today. It's all automated with Skubana and we only have one employee.
Jeff: Oh, wow. How big has Skubana now grown? How many employees do you have for this company?
Chad Rubin: Right now we're in New York City. We have 30 people and we're about to double the org. We're about to go to 60.
Jeff: Wow, that's exciting. Just so I got my timeline right, how long has Skubana been viable has it been a business?
Chad Rubin: Yeah, we've been pretty much live for three and a half years. We started building before ... for another year and a half to two years building what we call a minimum viable product. Just enough to get some traction to launch. Now we are just about to complete a fundraise which we haven't publicly announced yet, that will give us the capital to grow this thing beyond anything I could fathom.
Jeff: Wow, that's really exciting. Again, back on the tech side of it, you guys are working on software that will help a company logistically. Fulfill their orders, get their company to the space that it needs to get. To focus on the right things like you said.
Chad Rubin: Yeah.
Jeff: Where do you see the future of this company going, of Skubana, because it seems like it exists in that ever changing software space. It seems like for someone like me who knows very little about soft ... I break more computers than I actually know how they work. It seems like you are on the forefront of tech that is constantly changing, constantly being innovated. Is that a hurdle for you company and where do you see it going in the next few years?
Chad Rubin: The reason why the tech needs to change so much is that commerce is changing so much. What you know about commerce even just eCommerce in general expires after three to six months. Things are moving so, so, quickly. If you think back to the early 2000s and how people used to shop to now, and what's going to happen over the course of the next decade, we constantly have to be on the cusp of the changing environment and the changing landscape.
Chad Rubin: Right now only 10% of sales come from eCommerce and 90% is still brick and mortar. Those are going to really start to evolve. But, I would say like most people even with Death Wish when they're buying Death Wish Coffee online, when they hit the checkout they don't really think about anything until it hits their door.
Chad Rubin: So, between checkout and hitting your door, think about all logistics, all the things that have to happen to get that order packed, routed, orchestrated, managing your inventory if you're selling across multiple different channels. And then if you run out of coffee beans you have to reorder them and you have to know am I making money on these coffee beans across every channel and across every warehouse.
Chad Rubin: So, it is a beast to manage and Skubana starts to really thrive on complexity the more of a beast that's created. The more complex that you have the more we thrive.
Jeff: Very cool. Is it hard to constantly update the tech for what you guys do at Skubana when let's say there is so much other software involved in eCommerce? Amazon is always changing their platform. With those types of things is it hard to kind of be at the same level as everything else?
Chad Rubin: The lucky thing is I picked the right software partner to partner with. The way that we have developed our software we can essentially deploy code. In other words, we can update our code 15 to 20 times a day and the user will never know.
Chad Rubin: Most of the old school software companies were built before there was this thing called cloud computing. So, they would have to do patch releases every quarter to send updates. They couldn't move with agility and be nimble the way that we can. I think that we leverage that to our advantage where we can move incredibly quickly and build functionality and features that are more robust than other software platforms that are out today.
Jeff: Wow. It blows my mind sometimes to think about a space that you're in because it's so integral and so vital yet it's ever changing. It's like as we're having this conversation, there is new software being created immediately that you have to be at the forefront of. Is that daunting at all?
Chad Rubin: It is daunting. I think with every milestone that we accomplish internally here, what do they say, new level is new devils. So, as we launch and get to new heights in our company there's more things that we need to deal with that are more complex and more challenging.
Jeff: Wow. Back to you personally, Chad, as you said you kind of fell into being an entrepreneur. It was something that you never wanted to be and you failed at that. You failed wonderfully. You failed upward and you became an entrepreneur and now you're CEO of Skubana and still running your other company. What is maybe something that you've learned as an entrepreneur that is insightful that you never thought you would have learned?
Chad Rubin: I would say one of the things at least that I need to still constantly work on to overcome is not to take anything personally. I think that's something that I ... Skubana is my baby. As things change and we're dealing with humans at the end of the day we're all humans and we're all animals, and trying to relate to these other animals and control them ... not to control them but essentially to manage expectations internally is something that actually is a nonstop process.
Chad Rubin: I think it's probably one of the most important things that I do on a daily basis is coordinate with my team and make sure they're happy and make sure that everything's running smooth. But, if I had to look back and see what has been a strength of mine through the entrepreneurial journey, I would probably have to say just constantly being hit and persisting through that. Constantly going through things whether it's chaos or hitting lows just like the lows to be super lows and the highs to be super high and having persistence and breaking through those walls.
Jeff: Very cool. Very cool. So, on that same thought then, through everything that Skubana has achieved, what has been maybe the most surprising thing that has happened with this company? Something that maybe that you never thought you'd kind of get to?
Chad Rubin: Well, I would say like something recently ... Well, first of all we located everyone to New York City. The office you see behind me is everybody in New York. We used to have two separate offices. We had one in New Jersey one in New York. I never thought that we would all be in the same place in New York City and you can imagine we're in Chelsea. It's quite expensive to have an office here. Nothing is outsourced. Everything is literally in New York.
Chad Rubin: The second thing is that one of the things that DJ and I, maybe sometimes even to our detriment, we decided very early on to be a bootstrap company. In other words, we would pour our sweat, our heart and our tears into this thing but we wanted to maintain control and we also wanted to do it without taking capital from other people.
Chad Rubin: As we've moved upstream and as we've added more clients to our platform especially higher end clients and brands and retailers, we have moved upstream and I think we need to get the right resources to move upstream to support those clients and therefore we are just about to announce this capital raise which took me ... I locked myself in a room for a quarter, for three months, to find the right investors for this business that align with our values.
Jeff: Wow. That's an incredible thing to talk about too because it seems like you are doing something for the good of your company but it's completely out of your comfort zone. Is that correct?
Chad Rubin: Completely.
Jeff: Is that a hurdle personally for you? Do you feel good about it? Do you feel like you're growing or is that still something that you're wrestling with?
Chad Rubin: No, I feel like we made the decision. We committed to it and that's one of the things we do internally is if we made a decision we commit to it even if there's not ... everyone is fully onboard we all are committed to it.
Chad Rubin: The things is if you think about your life or at least when I think about my life, all of the gains that I've made, the personal gains, were made when I was not comfortable. So, yeah, it's ... I think we grow through discomfort.
Chad Rubin: Sure, I'm taking myself out of my comfort zone but we're going to ... It's going to be an incredible journey for sure.
Jeff: That's very inspiring. On that note I want to ask you the question we get to all the time. Through all everything that you've been through, again, getting into something you didn't never want to get into. Getting into business, getting into an entrepreneurship, starting this company Skubana and all the success you've seen over the last three and a half years, what fuels you to keep going? What fuels you to keep getting up every day and testing your comfort zone and striving to move forward?
Chad Rubin: I would say, as I mentioned earlier, I grew up and we had to essentially find pennies within couch cushions to pay the bills. We would be in line at the grocery store and my mom would have 20 different credit cards that she would charge she would try to use. With each decline she would try a different card.
Chad Rubin: So, one of the reasons why I chose finance or why I chose to go to college was to essentially to level up, to move on from the place historically that my family has been in and to build a family of my own. I would say one of them is essentially tearing off the rearview mirror and making sure I'm never in that place again.
Jeff: Very cool. Very inspiring. I mean that is ... you are the embodiment of the American dream. That is what that is is you want to better yourself and your life and the people around you so you can get to that next level. I like that terminology too.
Jeff: For someone who might be just wanting to start their idea, start their business, to get out there into the entrepreneurial space that's out there now, would you have any advice for them?
Chad Rubin: Yeah. I think we all walk through life and we have these moments of why does it have to be this way? When you ask yourself why does it have to be this way, that's where you can actually find problems that you can solve for. It could be maybe that you're in the shower and you constantly think of good ideas in the shower but you have nothing to write it on. So, a waterproof board to write your notes on in the morning. I'm just giving you an example, right?
Chad Rubin: So, solving problems and the only way to do that is have relatable problems in your life that you've walked through so that you can take those problems and bring them to reality and try to solve for those.
Jeff: Wow, very, very good. You are an incredible problem solver. It seems like you really get off on finding a problem and solving that. Again, that's very inspiring.
Jeff: I do want to end up here I just want to go on the other side of it. We all go to our jobs. We all ... if we're lucky enough to love our job and to be invigorated by what we get to do at our job. But, what gets you going outside of your job? What hobby or something that maybe somebody wouldn't know about you that outside of the business sense, what do you like to do to relax maybe?
Chad Rubin: I think when I do hobbies I get really, really into them. I'm very into the art of brewing coffee. Or, I'm into ... Yeah, I'm very into coffee. I'm very into let's just say I like to smoke hookah for fun at my house. I'm very into it. I've got very deep into that. I like to read. I certainly like to travel as we were talking about before the show got started. I'm about to take a very big extensive travel vacation with my wife because we're having our child.
Jeff: That's so awesome.
Chad Rubin: Recently I would say two weeks ago for fun I took freestyle lessons.
Jeff: Free like dance or ...
Chad Rubin: No, freestyle like hip hop improv freestyle.
Jeff: Like rap, that's great.
Chad Rubin: Yes.
Jeff: That's really cool.
Chad Rubin: It was amazing. I like to do these things and get myself out of my comfort zone and just get out of that prefrontal cortex and just get into other parts of my body.
Jeff: That's so rad ... do you think you're going to continue with your freestyle lessons?
Chad Rubin: I am actually.
Jeff: Yes, I can't wait for your first album.
Chad Rubin: Probably not an album but it certainly is fun.
Jeff: Oh, that's awesome. I got to ask for our listeners and viewers out there too. You did mention that you love to brew coffee and you kind of get ... that's like a hobby of yours. What's your brewing method? What do you really enjoy about brewing coffee? Let's talk a coffee a little bit here.
Chad Rubin: Yeah. First of all I love a great espresso but I also in the morning ... this morning I did a French press cold brew. One of the things especially in the summer since I have a garden that's one of the things I also like to do is I like to put some mint in it and let that marinate over the course of the evening. I wake up and you have this natural-tasting coffee with mint. It's like a cocoa and mint together. It's fantastic.
Jeff: Whoa, what a great idea. I'm going to steal that idea. That's awesome.
Chad Rubin: Yeah, it's super tasty. I like to do that in the summer. In the winter typically I just like a pour over. I'll use a Kalita pour over and it's just right. I do all my grinding right on the spot and I like to get the essence of the oils in my cup. I have a Death Wish cup that I love brewing with. It's the perfect size.
Jeff: Coffee, it's so funny, coffee culture has become just that. It is a culture. It is this experience. I love talking about it with people because like you said in the morning it becomes this ritual. You kind of put into your day because so much of your day just becomes autopilot. You wake up. You brush your teeth. You put your clothes on. You grab your keys you get out the door. You don't have to think about any of that stuff. But, it's nice to take a minute and to brew coffee and that kind of thing. That's really, really fun.
Jeff: Chad, it was incredible talking to you. It was very, very inspiring. I can't wait to see where the rest of your journey takes you. For our listeners and viewers, obviously you can follow Skubana. But, for you personally is there a way to follow your personal journey? Do you do social media at all? Is there anything that you'd want to plug?
Chad Rubin: Yeah. First I want to just thank you for taking the time to chat with me. This was awesome. If you want to check out what I'm up to, you can check out a book I wrote which, of course, it's on Amazon. It's called Cheaper Easier Direct. You can email me at firstname.lastname@example.org if you want to talk coffee or if you want to talk software or even just entrepreneurship. Yeah, looking forward.
Jeff: Excellent. I got to ask then before we wrap up. Writing a book, what was that like? Was that out of your comfort zone?
Chad Rubin: Yes, it was and I found a really good write to co-author it with me. Recently I've been working on the next book. But yeah, writing the book was amazing. It got me some good publicity and press but also most importantly it's all about reciprocity and I'm all about giving. The book just opens up everything I've done to build my business.
Jeff: That's excellent. The other question that I asked you earlier about Skubana I want to put towards writing a book. Is there anything you learned from writing the book that surprised you? Or, something that maybe happened from writing that book that you weren't prepared for?
Chad Rubin: I got an interview with NPR which was amazing. I got a lot of speaking gigs. All of that was unexpected. For me it was all about I wanted to create content and knowledge. When I go to these conferences, these eCommerce or commerce conference, instead of giving out a cozie or a phone holder for your cell phone, I wanted to give out something that really people can take with them and they can read it and they can educate themselves and it's just going to add a ton of value to their lives.
Chad Rubin: That has been amazing because I get emails from people because I put my email in the book and people write me all the time being like, "I'm so thankful that I found this book. It was such an inspiration. I've used your same playbook and I'm creating my own business now." So, getting those kinds of emails on a daily basis is also a great driving force.
Jeff: That's so cool. I will most definitely put links to that book in this episode as well. Once again, Chad, thank you so much for talking with me today.
Chad Rubin: Thank you.
Jeff: It truly was inspiring.
Chad Rubin: Thanks for having me.
Speaker 3: This has been Fueled by Death Cast, a Death Wish Coffee company podcast production. Thanks for listening.