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Jun 12, 2016 · 21m · top-founders

Meat on Demand Does $1,200,000 in 2015, EP 280: Tim Ray

Tim Ray · 11m spoken Nathan Latka · 7m spoken
0:00 / 0:00

gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions

Serial entrepreneur Tim Ray joins Nathan Latka on The Top to break down how he bootstrapped Carnivore Club to $2.2 million in revenue, leveraged podcast advertising, and executed profitable e-commerce acquisitions and exits.

How this conversation actually went

Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nathan holds 39.3% of the talking time here. How this is scored →

Nathan as informed peer 3.8 Guest teaching 3.0 Guest disagreement 1.3 Nathan pushing back 2.5
05100:0010:0020:001:42–3:48 · Nathan as informed peer 5/10 Founding, Scaling, and Selling FoodScrooge Nathan inquires about Tim's first company FoodScrooge and demonstrates familiarity with earnout structures and their common pitfalls. Tim explains how they successfully maxed out their 2.1 million dollar earnout with Torstar Media.3:49–6:34 · Nathan as informed peer 4/10 Acquiring Broquet and Comparative E-Commerce Models Tim politely corrects Nathan's intro assumption by clarifying he acquired Broquet rather than founding it. Tim contrasts Broquet's capital-intensive traditional e-commerce inventory model with subscription models.6:34–9:12 · Nathan as informed peer 3/10 Carnivore Club Origins, Crowdfunding, and Volume Growth Tim details the launch of Carnivore Club via Indiegogo to establish initial critical mass with suppliers rather than pure exposure. Nathan tracks box volume scaling from launch to over 5,000 monthly shipments.9:13–12:51 · Nathan as informed peer 5/10 Subscription Mechanics and Cash Flow Float Advantage Tim explains the negative working capital float advantage of upfront multi-month gift payments and guides Nathan around the website's checkout funnels. Nathan probes whether the business can be valued like a true SaaS recurring revenue model.12:51–17:38 · Nathan as informed peer 5/10 Revenue Performance, Gross Margins, and Team Structure Tim discusses the company's 1.3 million dollar revenue, 35 percent gross margins, and customer acquisition shift to podcast sponsorships. Nathan pushes Tim to break down exact CPM rates and per-episode costs across shows.17:38–20:43 · Nathan as informed peer 1/10 Audience Contest Instructions and HostGator Promotion Nathan conducts mid-roll host-read advertisements, runs through the rapid-fire Famous Five questions, and closes the interview.1:42–3:48 · Guest teaching 2/10 Founding, Scaling, and Selling FoodScrooge Nathan inquires about Tim's first company FoodScrooge and demonstrates familiarity with earnout structures and their common pitfalls. Tim explains how they successfully maxed out their 2.1 million dollar earnout with Torstar Media.3:49–6:34 · Guest teaching 4/10 Acquiring Broquet and Comparative E-Commerce Models Tim politely corrects Nathan's intro assumption by clarifying he acquired Broquet rather than founding it. Tim contrasts Broquet's capital-intensive traditional e-commerce inventory model with subscription models.6:34–9:12 · Guest teaching 3/10 Carnivore Club Origins, Crowdfunding, and Volume Growth Tim details the launch of Carnivore Club via Indiegogo to establish initial critical mass with suppliers rather than pure exposure. Nathan tracks box volume scaling from launch to over 5,000 monthly shipments.9:13–12:51 · Guest teaching 5/10 Subscription Mechanics and Cash Flow Float Advantage Tim explains the negative working capital float advantage of upfront multi-month gift payments and guides Nathan around the website's checkout funnels. Nathan probes whether the business can be valued like a true SaaS recurring revenue model.12:51–17:38 · Guest teaching 3/10 Revenue Performance, Gross Margins, and Team Structure Tim discusses the company's 1.3 million dollar revenue, 35 percent gross margins, and customer acquisition shift to podcast sponsorships. Nathan pushes Tim to break down exact CPM rates and per-episode costs across shows.17:38–20:43 · Guest teaching 1/10 Audience Contest Instructions and HostGator Promotion Nathan conducts mid-roll host-read advertisements, runs through the rapid-fire Famous Five questions, and closes the interview.1:42–3:48 · Guest disagreement 1/10 Founding, Scaling, and Selling FoodScrooge Nathan inquires about Tim's first company FoodScrooge and demonstrates familiarity with earnout structures and their common pitfalls. Tim explains how they successfully maxed out their 2.1 million dollar earnout with Torstar Media.3:49–6:34 · Guest disagreement 2/10 Acquiring Broquet and Comparative E-Commerce Models Tim politely corrects Nathan's intro assumption by clarifying he acquired Broquet rather than founding it. Tim contrasts Broquet's capital-intensive traditional e-commerce inventory model with subscription models.6:34–9:12 · Guest disagreement 1/10 Carnivore Club Origins, Crowdfunding, and Volume Growth Tim details the launch of Carnivore Club via Indiegogo to establish initial critical mass with suppliers rather than pure exposure. Nathan tracks box volume scaling from launch to over 5,000 monthly shipments.9:13–12:51 · Guest disagreement 2/10 Subscription Mechanics and Cash Flow Float Advantage Tim explains the negative working capital float advantage of upfront multi-month gift payments and guides Nathan around the website's checkout funnels. Nathan probes whether the business can be valued like a true SaaS recurring revenue model.12:51–17:38 · Guest disagreement 1/10 Revenue Performance, Gross Margins, and Team Structure Tim discusses the company's 1.3 million dollar revenue, 35 percent gross margins, and customer acquisition shift to podcast sponsorships. Nathan pushes Tim to break down exact CPM rates and per-episode costs across shows.17:38–20:43 · Guest disagreement 1/10 Audience Contest Instructions and HostGator Promotion Nathan conducts mid-roll host-read advertisements, runs through the rapid-fire Famous Five questions, and closes the interview.1:42–3:48 · Nathan pushing back 2/10 Founding, Scaling, and Selling FoodScrooge Nathan inquires about Tim's first company FoodScrooge and demonstrates familiarity with earnout structures and their common pitfalls. Tim explains how they successfully maxed out their 2.1 million dollar earnout with Torstar Media.3:49–6:34 · Nathan pushing back 3/10 Acquiring Broquet and Comparative E-Commerce Models Tim politely corrects Nathan's intro assumption by clarifying he acquired Broquet rather than founding it. Tim contrasts Broquet's capital-intensive traditional e-commerce inventory model with subscription models.6:34–9:12 · Nathan pushing back 2/10 Carnivore Club Origins, Crowdfunding, and Volume Growth Tim details the launch of Carnivore Club via Indiegogo to establish initial critical mass with suppliers rather than pure exposure. Nathan tracks box volume scaling from launch to over 5,000 monthly shipments.9:13–12:51 · Nathan pushing back 4/10 Subscription Mechanics and Cash Flow Float Advantage Tim explains the negative working capital float advantage of upfront multi-month gift payments and guides Nathan around the website's checkout funnels. Nathan probes whether the business can be valued like a true SaaS recurring revenue model.12:51–17:38 · Nathan pushing back 3/10 Revenue Performance, Gross Margins, and Team Structure Tim discusses the company's 1.3 million dollar revenue, 35 percent gross margins, and customer acquisition shift to podcast sponsorships. Nathan pushes Tim to break down exact CPM rates and per-episode costs across shows.17:38–20:43 · Nathan pushing back 1/10 Audience Contest Instructions and HostGator Promotion Nathan conducts mid-roll host-read advertisements, runs through the rapid-fire Famous Five questions, and closes the interview.

speaking balance: gold is Nathan, purple is the guest (3 minute bins)

0:00 · Nathan 60% · guest 40%0:00 · Nathan 60% · guest 40%3:00 · Nathan 20.7% · guest 79.3%3:00 · Nathan 20.7% · guest 79.3%6:00 · Nathan 16.5% · guest 83.5%6:00 · Nathan 16.5% · guest 83.5%9:00 · Nathan 32% · guest 68%9:00 · Nathan 32% · guest 68%12:00 · Nathan 17.4% · guest 82.6%12:00 · Nathan 17.4% · guest 82.6%15:00 · Nathan 34% · guest 66%15:00 · Nathan 34% · guest 66%18:00 · Nathan 79.8% · guest 20.2%18:00 · Nathan 79.8% · guest 20.2%21:00 · Nathan 100% · guest 0%21:00 · Nathan 100% · guest 0%
Sharpest disagreement ▶ 3:49 Correcting founding history premise

Tim corrects Nathan's introductory assumption directly, pointing out that he bought Broquet rather than founding it in 2012.

 Hardest push from Nathan ▶ 11:47 Pushing for SaaS recurring valuation comparability

Nathan challenges Tim on whether non-recurring multi-month gift sales can legitimately justify SaaS-style recurring revenue valuation multiples.

 Biggest teaching moment ▶ 9:10 Explaining subscription cash float dynamics

Tim educates Nathan on how Carnivore Club creates a positive working capital float through upfront multi-month payments before inventory costs are incurred.

 Nathan holds their own ▶ 3:15 Demonstrating earnout contract literacy

Nathan demonstrates operational and financial fluency by identifying standard earnout trapdoors involving profit accounting and loss of operational control.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Founding, Scaling, and Selling FoodScrooge 5212 Nathan inquires about Tim's first company FoodScrooge and demonstrates familiarity with earnout structures and their common pitfalls. Tim explains how they successfully maxed out their 2.1 million dollar earnout with Torstar Media.
Acquiring Broquet and Comparative E-Commerce Models 4423 Tim politely corrects Nathan's intro assumption by clarifying he acquired Broquet rather than founding it. Tim contrasts Broquet's capital-intensive traditional e-commerce inventory model with subscription models.
Carnivore Club Origins, Crowdfunding, and Volume Growth 3312 Tim details the launch of Carnivore Club via Indiegogo to establish initial critical mass with suppliers rather than pure exposure. Nathan tracks box volume scaling from launch to over 5,000 monthly shipments.
Subscription Mechanics and Cash Flow Float Advantage 5524 Tim explains the negative working capital float advantage of upfront multi-month gift payments and guides Nathan around the website's checkout funnels. Nathan probes whether the business can be valued like a true SaaS recurring revenue model.
Revenue Performance, Gross Margins, and Team Structure 5313 Tim discusses the company's 1.3 million dollar revenue, 35 percent gross margins, and customer acquisition shift to podcast sponsorships. Nathan pushes Tim to break down exact CPM rates and per-episode costs across shows.
Audience Contest Instructions and HostGator Promotion 1111 Nathan conducts mid-roll host-read advertisements, runs through the rapid-fire Famous Five questions, and closes the interview.

Statements from this episode (11)

Assertion Not checkable as stated
Ray: FoodScrooge signed an LOI in eight weeks, hitting $150K revenue
“So we actually signed our letter of intent to sell eight weeks after we launched. And within the four months that we were operating, we did about a 150,000 in revenue”
Tim Ray Jun 12, 2016 ▶ 2:44
Assertion Not checkable as stated
FoodScrooge was acquired for $100K upfront and a $2.1M maxed-out earnout
“So it was basically a 100,000 up front with a 2.1 million dollar purchase price, which we were able to max out based on the earn out agreement.”
Tim Ray Jun 12, 2016 ▶ 3:08
Assertion Not checkable as stated
Broquet generated roughly $200,000 in gross revenue when Ray acquired it
“So when I bought it was just doing around 200,000 in gross revenue.”
Tim Ray Jun 12, 2016 ▶ 4:12
Disclosure
Ray acquired Broquet for $150,000, paying it out over time
“So it's a 150,000 dollar buy price is what I bought it for which we're in the process of you know, paying that out over the course of scaling the company.”
Tim Ray Jun 12, 2016 ▶ 5:06
Assertion Not checkable as stated
Carnivore Club ships 5,500 monthly boxes, peaking at 8,000 during Christmas
“So we sent just over, I think, 8000 at Christmas time. And you know, so we probably two thirds of our sales are gift oriented. And on a typical month, like now we'd send around 5500 boxes”
Tim Ray Jun 12, 2016 ▶ 8:33
Assertion Not checkable as stated
Carnivore Club reached nearly $200,000 in sales in February 2016
“February, 2016, we did just shy of 200,000 in sales across Canada, the U S and Europe.”
Tim Ray Jun 12, 2016 ▶ 10:20
Assertion Not checkable as stated
Carnivore Club generated $1.3 million in revenue during fiscal year 2015
“Our year ends in in August, we did 1.3 million in 2015.”
Tim Ray Jun 12, 2016 ▶ 12:59
Prediction Not checkable as stated
Carnivore Club projected reaching $2.2 million in revenue for 2016
“We're aiming for about 2.2 in 2016.”
Tim Ray Jun 12, 2016 ▶ 13:05
Disclosure
Carnivore Club bootstrapped two years of growth on $100,000 founder capital
“We only started this company with a 100,000 dollars of startup capital from my previous exit, which isn't much. And, you know, we've been able to grow to where we are in two years with that original 100,000. We haven't raised any capital, so.”
Tim Ray Jun 12, 2016 ▶ 13:09
Assertion Not checkable as stated
Carnivore Club operates at a 35% average gross margin after shipping
“So we're about a 35% average margin business when you're taking the, you know, discounts and our shipping is changing every month.”
Tim Ray Jun 12, 2016 ▶ 13:27
Disclosure
Carnivore Club paid $10,000 per ad read on WTF with Marc Maron
“Drinking Bros is a fairly small podcast. It's about 20,000, you know, downloads and we're paying about two 70 a pop versus we got a big podcast where you come out with WTF with Marc Maron you know, and we're paying 10 grand a pop on that one.”
Tim Ray Jun 12, 2016 ▶ 16:19
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