Chase Clymer
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Alex Levine
You're more likely to learn from getting your hands dirty and making some decisions, versus spending all of your time trying to make the perfect decision.
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 to another episode of Honest Ecommerce. And today, I'm welcome to the show not one but two founders. I love interviewing co-founders on the show.
Today, I'm bringing to the show Alex and Trevor. They're coming to us from Xebec.
Welcome to the show.
Alex Levine
Appreciate it.
Thanks, Chase.
Trevor Russo
Thanks for having us.
Chase Clymer
Awesome. So for the audience that isn't [in the loop], can you talk about the products that you guys are bringing to market over there?
Alex Levine
Yeah, absolutely. So Xebec is a computer accessories brand that's building products to enable what we call "the modern professional", "the mobile professional" to be successful in this new mobile workplace away from the office.
And our flagship product is the Xebec Tri-Screen, which is a laptop attachment that adds two additional monitors to your setup, to enable you to maximize productivity without sacrificing portability while working away from your standard office.
Chase Clymer
Absolutely, the product is super cool. I've been playing around on the website and I definitely recommend people to check it out.
And just, I guess, where did this idea come from? Take me back in time. What was going on?
Alex Levine
Yeah, absolutely.
So the genesis, if you will, of Xebec starts back in 2017. Back at that time, both Trevor and myself were working in the world of corporate consulting at Accenture and Deloitte respectively, doing the traditional Monday through Thursday travel schedule.
So flying out Monday morning to a client site somewhere across the country, working from hotels, airports, airport lounges, the corner of a client's office...
You name it. Anywhere but a consistent workspace.
And in doing that, we noticed that there was kind of severe discrepancy between what our work space looked like Monday through Thursday, versus Friday, we had these beautiful home offices with Herman Miller chairs, anti-carpal tunnel wrist pads, and all the elements of a productive environment that you'd see in a traditional office yet.
In this consulting world, we were spending most of our time huddled over a small laptop screen. And so we set out to find a way to be able to recreate the productive elements of that office but in this mobile setting.
And after a flight home and some nasty 3D AutoCAD drawings and 3D prints, we had our version zero of what is now our Xebec Tri-Screen product.
And when we came up with the concept at the time, when I came up with the concept, I shared it with Trevor immediately.
Longtime friend also, most importantly, somebody who also understood the pain points of working on the road. And so sharing it with Trevor was really just a natural next step for us.
Chase Clymer
And when did it...
Going from those kinds of CAD drawings...
I guess, maybe, let's take it back. When did it go from idea to first prototype? How long was that?
Alex Levine
That was a quick turnaround. That was a matter of a weekend. So I flew home from... I was actually working in New York at the time, which is where Trevor was.
Flew in from New York one weekend, whipped up a really nasty --when I say nasty, it's just terrible-- AutoCAD drawing, 3D printed it with my own 3D printer and bust out some old laptop screens.
And so within a couple of days, we had our first prototype. We definitely believe in moving as fast as you possibly can.
Because no matter how much time you have, you're more likely to learn from getting your hands dirty and making some decisions versus spending all your time trying to make the perfect decision.
So it took about 2 years from that point, 2 and a half years from that point until we actually launched, but it was February of 2017. When we first came up with the concept.
Chase Clymer
Absolutely. Trevor, do you remember the first prototype?
Trevor Russo
I do. I do. Indeed. It was...
Alex was honest. I was in New York for some reason, like he said, and showed it to me. We went to a baseball game and then he showed [it to] me afterwards. And the time was I was...
He has much more experience than I do with prototyping and 3D printing and everything. So my first question was how it's going to look? And then from there, of course...
First of all, it's come a long way since then. And it was really exciting to see that and to see how quickly we could get that turned around.
I think a thing that a lot of people make mistakes on is just trying to make everything perfect upfront, when in reality, you just need to get something functional and make sure "Hey, is this a feasible idea that we can move forward with?" And so, from there was...
At the time, we both still had our full-time jobs. So that's why it took a little bit longer from 2017 to 2019.
But during those days it was awesome to be able to push that along and prototype after prototype, and then finally build that initial product.
Chase Clymer
Absolutely. Now, can you talk about some of the...
You said it took 2 years for that first prototype to the one that you actually took to market? What were some of the challenges that you guys were trying to overcome in those 2 years?
Alex Levine
I think for us, it was... There were a couple of challenges. I think one was initially understanding who our market was. We initially built the product to use selfishly, just to take with us on the road and solve our pain point.
When I brought it back up to my client site the following week, my team at Accenture was excited to see it.
They're like, "Oh, this is awesome. I want to buy one of these." And then after I explained, "Oh, I printed this." They're like, "Oh, print me one." And that was certainly not going to happen.
And so then sharing it with Trevor and hearing similar sentiments from his team, we realized we were on to something there.
But initially thinking, "Oh, we can maybe make a couple 100 of these, sell them on the side to other people in the world of consulting."
But then we realized this traveling professional: The accountant, the consultant, the salesperson who's on the road on a weekly basis...
Even though over 7 million people, pre-COVID, 7 million people a week were doing that. We realized it was really just the tip of the iceberg.
And there was this large and ever growing population of remote workers that were working anywhere from 1 to 5 days a week away from the consistent office.
Now, that could be at a cafe, at a co-working space at their house, a digital nomad traversing Europe or Southeast Asia...
But that was really, I think, step one. [It] was understanding who we were building it for on the scale that it could be.
And then two, I think, was really overcoming the fear of dropping solid careers, to be able to pursue what is a wild concept.
And so I think that that's something that always provides apprehension for any entrepreneur. But for us, we felt like it was now or never there in September of 2019.
And so, I took the jump first. And then not too soon thereafter, I convinced Trevor to bail a few months before even as a bonus hit to come join us because we were having too much business.
So it was a good problem to have.
Chase Clymer
That's fantastic that you guys were seeing...
Having too much business, as always, is always a good problem to have.
So what were you doing to acquire those customers? How were you growing so fast?
Alex Levine
Yeah, it was...
So we launched in October of 2019. And fast forward 3 months we... We're all faced with the pandemic. And especially the onset, nobody understood what was going to happen.
We announced the project there in 2019. But we were supposed to go live at South by Southwest in Austin in 2020.
Of course, China didn't come back from Chinese New Year and South by Southwest certainly didn't happen. And so we had all of our capital tied up overseas.
We were also in the process of trying to raise our first round of funding, right there in January and February 2020. And we really had a decision to make which was "Okay, we can either try to sell this business to investors or we can sell products to customers."
And with investors' wallets being rather tight at that time, we said, "Alright, let's just turn around and make do with what we've gotten."
Luckily, the world opened up slowly, but surely. Certainly not the way we anticipated. But the traditional way, most people in the direct-to-consumer space, got off the ground, building out a solid Ecommerce website.
Initially, we were actually on Wix even before we were on Shopify, which is funny, because I don't know that.
Every time we share that, people are surprised by the capabilities that it has. But it was a tool we knew.
And so we did that, running Facebook and Instagram ads, and building out a really, really basic email flow, and just seeing what we could do there.
And slowly but surely, we're able to grow with the profits we gained from our incremental sales. So it was a slow and steady pickup through the summer of 2020.
Chase Clymer
Absolutely. Now, I know that growing a business with paid traffic is a bit of an investment.
Can you share anything numbers wise along using that as a growth tool, like what an entrepreneur might want to expect in the tech space?
Alex Levine
Yeah. What the world of paid media, especially Facebook and Instagram back in 2020 was versus what it is now is so different.
Of course, with the iOS 14 updates, just a lot of the transparency has been --for good reason-- has been lost. And so attribution is a bit of a shot in the dark.
So I can't quite say what you should be able to expect. But I do think one thing that was really key for us at Xebec was having a flagship product, our Tri-Screen, that was a rather high-ticket item.
Our original Tri-Screen, we sold for $449 and regularly ran a $50 discount at that time, as we were trying to find the price fit. And so we're selling this $400 product.
And so that gave us a lot of leeway between understanding the various ways in which we could acquire new customers and having a little more leeway with testing.
Now, of course, although their margins started to fluctuate, as Trevor can share, shed a lot of light on especially logistics.
We got ourselves in 2021 to his base where we were paying something absurd like $40 per unit to freight it from China to the US because freight was so backed up at the port. So I think it's just a matter of understanding where your margins are.
I think it's tough to sell a $20 - $30 - $40 flagship product. Now of course, you'll get more conversions and your conversion rate would likely be higher, but you have less room for error if you've got tighter margins.
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Chase Clymer
Alex just alluded to some issues that you guys ran into during logistics during COVID. Everyone remembers that. Trevor, is there anything that you can share about those challenges?
Trevor Russo
Yeah, definitely. It's been...
Uniquely for us, as just growing up during COVID, it's been all we've known. It's those long transit times, and those expensive freight containers and shipping.
And so luckily, it was something that we baked in right away, just because it's not like we had to go from quick transit times and then adjust after that.
But with that said though, it was still very much a huge challenge resulting in us being on backorder, way more than we would have liked.
At the end of day, that is a good problem to have. That means we were selling.
But definitely a point of frustration of having containers take what used to be very much lower averages at this point.
Or when we launched, [it was] 50 - 60 day averages door to door. And so with that, it was just something that we had to become flexible with.
And luckily, our customers were understanding as I think most people were doing COVID, just recognizing that everything's taking longer.
But today, we've been able to get creative, find other solutions, and thankfully, be able to find other solutions to get the freight over here more quickly, and avoid those back orders, and make sure that we can get our products to customers right away.
Chase Clymer
Awesome. A lot of learning going on during those trying times, I guess.
Trevor Russo
Yeah.
Chase Clymer
Alex, you mentioned something there that you guys started on Wix and you made that leap over to Shopify.
And I know that this is a challenge that a lot of entrepreneurs run into. They launch just what they know and move on to something that probably matches their needs a lot better.
When did you know it was the right time to make the leap to a more sophisticated platform?
Alex Levine
Yeah. So one, I think, I could not be a bigger proponent of working with what you know.
I think so many people get caught up on everything they don't know to the point where it blinds them from the thought of it being a possibility to start to begin with.
And I think the one thing I say to that and when I talked to a lot of entrepreneurs, I say, "If you think right now you don't know enough, just wait 6 months or a year from now and you're gonna realize even less."
And we expect that to continue for us. What I realized I don't know now is much more than what I realized I didn't know 2 or 3 years ago.
And so for us, it was one of the agencies we were working with on the performance marketing side that highly recommended it.
And for us, it was really on the operations and customer experience side where we realized we just needed something more robust to be able to modify our orders, be able to run reports on our orders, and the robust end-to-end system as opposed to coding up our own API's to be able to communicate with all the other systems out there.
So I think it was as we've faced more pain points, and found solutions for those but realize they were limited on the platform we were currently at.
Chase Clymer
Absolutely. And I agree with you. Get started with what you know, because I think a lot of times with entrepreneurs, the struggle is finding product-market fit. And if your thing...
If your product will sell on whatever platform you put it on, you're onto the right thing. But getting caught up in this analysis paralysis about what is going to be the best platform to launch this business on right now and thinking about...
I think a lot of people get caught up in like what if: "If I'm a million dollar business, if I'm a $10 million business. I need all this functionality."
And it's like, "But you're not even a $1 business." You haven't sold anything. Go sell something.
Alex Levine
Right. Yeah, no. I'm a massive subscriber to the Lean Startup book by Eric Ries. It's almost like you know, startup Bible.
"Hey, build your MVP, find that fit, understand that there's going to be limitations..."
And in the world of hardware, it's much harder. I come from a web and software background, my days at Accenture.
And it's a lot easier to push out an update than it is to say, "Hey, we're gonna make a modification of the tooling and update a product." And you certainly can't update something that's already out there.
But, if you got too concerned with making it, what you thought was 100% perfect at all times, you'd never release anything.
And you see that a lot in the world of crowdfunding. That can be a major issue. Kickstarter and Indiegogo, you see these brands that raise $500,000 - $600,000. And then they don't deliver anything because they spent all their time optimizing.
And so as soon as you release something, you know it's not the most up to date technology, because that's how component sourcing works.
So there's a really great methodology for product development that we also like to follow. It's questionable on the source of the quote. But they say it was the founder of Nintendo that came up with it. He said, "Lateral design with weathered technology."
And so use components that are tried and true and have been around for a number of years, but use them in a unique way to be able to enable this new user experience that no other products on the market allow you to do.
And so I think too many people try to make the components more innovative than the way in which they organize those.
And so very similar to the Michael Dell approach in the early days, assemble and reorganize things in a way that's unique and nuanced. And don't get too caught up on the minute details of the components.
Chase Clymer
Yeah. You just blew my brain bringing up that Nintendo quote and it's something I have. Honestly, [I'm a] big nerd and I never brought it over to the side of...
The Ecommerce side of my business and thinking about it from that perspective. I was just always like...
Nintendo was wild with the innovations that they brought to the videogame market. So thanks for that quote. Obviously, Lean Startup is a fantastic book. Another thing from...
I don't know if it's in the Lean Startup or not, but just the thought of like...
If you're not embarrassed by your first version of whatever you're launching, you waited too long.
Alex Levine
Yep. Yeah, no, I agree. I think it's a really healthy tension between Trevor and I. One, we've known each other for over 20 years, we grew up with one another, both went to the University of Texas and studied very different things.
Trevor moved to New York, I stayed in Texas. But with that being said, we're also very different people Trevor's much more...
I sent Trevor...
I just sent Trevor, our investor newsletter for him to check for grammar mistakes, and dot the i's and cross the t's. And I'm much more of a fast mover. "How quickly can we break things and fix them?"
And I think that that balance is really helpful as well. I think if they were 2 of me, we would build a lot of things halfway through and they wouldn't be as well thought out as they could be.
And so I guess the reason why I bring that up is, I think finding that balance with a co-founder is really critical so you can, make sure that what you release is certainly a value to the market, but not be so concerned with trying to make it a Van Gogh painting that nothing ever gets out the door.
Trevor Russo
It is a very tough balance. Anybody who's creating something, you have pride in what you're doing. So you want it to be perfect. You want...
You know that everyone's gonna see it so you definitely think about what they are going to...
What's gonna be their first impression? But at the end of the day, it is...
We look at Apple or any of these technology companies and then you go back to their first version and...
It's been so long since we've seen it and now we're looking at it, and everything's beautiful and perfect. But then we go back, we look at what it used to be, and it's almost appalling at times. I can't believe I used to use that.
And I think anytime you have a product that's innovative, you bring that out, people are gonna want it because it's new, it's innovative, it solves a problem that they could not solve previously.
And so it's amazing just being able to solve that initially, and then iterate, then you can get into making it perfect, and continue to optimize after that.
Chase Clymer
Now, is there anything I forgot to ask you about today that you think would resonate with our audience?
Alex Levine
So I guess a few things. One, so we launched our original... And I guess, continued evolution of the story, which I think is helpful to kind of bring us to where we are today.
So, we actually, just about a year ago --it was June of 2021-- we launched our Tri-Screen 2, which was --speaking of iteration-- was that second version of the Tri-Screen, really bringing in all the pieces of feedback we received over the previous year and a half from our customers, which was incredibly critical to building a product that we are beyond proud of to this very day.
We were finalists for that Innovation Award at South by Southwest with this Tri-Screen 2, as well as a number of other awards, which was crazy to think about when we were sitting, hacking away, and AutoCAD, as my degrees in civil engineering, but I'm a zero means a product engineer at the time.
And so it's just really exciting to see things continue to evolve.
And then in October of 21, we launched our first non-display product, our AirStand, which is a compact laptop stand that enables you to prop your laptop up when you need it, but then fold it down seamlessly when you're on the go.
And that was an incredibly exciting product for us to launch to understand the need for similar accessories in the Xebec ecosystem. And that's really led us to today, where we have recently launched our entire accessory line.
So we've got our bluetooth keyboard, mouse, and power bank, which we just launched, which has been incredibly exciting to see how that has really enabled people to build out their entire mobile office suite and stay in this Xebec ecosystem.
Chase Clymer
And if people are excited about these new products, they want to go check them out. Where should they go?
Alex Levine
We sell exclusively from our website, www.thexebec.com. That's T-H-E-X-E-B-E-C.com.
And yeah, that's the only place where you'll find our products directly on our website.
Chase Clymer
Awesome. Trevor, Alex, thank you so much for coming on the show today.
Alex Levine
I appreciate it. Thanks, Chase.
Trevor Russo
Thanks, Chase. Appreciate it.
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.
You can subscribe to the newsletter at honestecommerce.com to get each episode delivered right to your inbox.
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Lastly, if you're a store owner looking for an amazing partner to help get your Shopify store to the next level, reach out to Electric Eye at electriceye.io/connect.
Until next time!
