How I Lost Six Figures and My First Business with Josh Lachkovic

Chris Norton: 0:00

Hi everybody, welcome to Socially Unacceptable. My name's Chris Norton. I'm the Managing Director of Prohibition PR. I'm here with William Ockenden, my business partner. This week, we have got so much to cover. This podcast is probably one of the most exciting podcasts we've done and it's an interview with Josh Lachkovic. Josh is the MD and founder of a growth agency, but he has some fascinating insights on how to grow even today after iOS 14 on Meta and make your business grow. But similarly, he's got some really interesting insights into failing and a business that's failed, and he's been through that. He's been through the spike of the pandemic to the drop after the pandemic. So, honestly, this is probably one of the most interesting podcasts we've done, so be sure to watch the rest of it and let us know what you think in the comments.

Josh Lachkovic: 0:59

In general, I think, take the opportunity when it's there and say yes to all the stuff and you really lead into it. Don't be scared of failing.

Will Ockenden: 1:08

As a creative agency, or rather a creative integrated agency. It's really refreshing to hear actually creative is down to the quality. Creative rather than just technical now, so it's going to get consumers engaged.

Chris Norton: 1:18

And also don't have really complicated structures and targeting, because that doesn't work anymore, which is, let's face it, the way that it was being done 18 months ago and it was working brilliantly. Then, overnight, it just didn't work as well. But you're an entrepreneur and you're fighting to keep the company going right. That's what we do as business owners.

Will Ockenden: 1:36

how did that feel personally? Was there a sense of relief? Did you feel failure?

Josh Lachkovic: 1:41

I hope I'm allowed to swear on this podcast.

Vicki Murphy: 1:47

Welcome to socially unacceptable, from f**k ups to fame, the marketing podcast that celebrates the professional mishaps, mistakes and misjudgments, while delivering valuable marketing and life lessons in the time it takes you to eat your lunch.

Chris Norton: 2:05

Hi everybody, welcome to socially unacceptable. This week we've got a very exciting guest, Josh Lachovic, who is a growth agency founder of Amphora, which is a creative growth agency and Will, is joining me in the studio again this week. Hi Will,

Will Ockenden: 2:24

I am actually, and I won't go into it in too much detail, but Josh has got some really interesting things to say about failure, which I'm looking forward to digging into, and also wine, which I'm a massive fan of.

Chris Norton: 2:35

Yeah, wine. There's lots to get into here, and the first question was so you know, this podcast is all about f**ks, and our technology is f**ked up three times this morning, this afternoon already, so let's get into it, I want to ask you. So the question I want to ask you is what is a growth hacker? What's a growth specialist? And has it got a bad rep? Because agency owners like Will and I are getting a lot of messages from growth hackers who tell us that we can have 10 customers next week if we just sign up tomorrow. So how do you guys have a growth? How do you approach it, josh?

Josh Lachkovic: 3:13

Yeah, first of all, I get a load of those invites as well, and I'd say you can ignore most of them. No, first of all, actually thank you for having me on. It's a real pleasure to be on and looking forward to chatting about failing as much as possible today. In answer to the growth question, growth isn't just a modern name for marketing, as I think a lot of people have kind of thought it might be, and it's got a bit of a bad rep because of that.

Josh Lachkovic: 3:39

Growth as a discipline, starting at Facebook and really combined a few elements, one of which was this experiment driven approach to running things. So everything was about scientific experiments. You create hypotheses around how something will work. You put a test together, you test a small part of your audience and get some results and data and then, if it works, you roll it out to your wider set of users. Part of it was about that.

Josh Lachkovic: 4:10

Part of it was this data, very heavy data side of it, which you know you had big data science teams kind of impacting on growth in general. And then the kind of third part was really about thinking of how this user psychology element played in, like understanding why people did certain things, kind of what type of things people were using platforms for and building platforms for those people. So for us, growth is about that. It's about bringing together a process, this experiment kind of culture, lots of data and analytics and user psychology, and we apply that to our kind of core marketing channels, which paid social, for example, is one of our core ones.

Will Ockenden: 4:52

Yeah, and I think we'll dig into paid social in a moment. So do you want to talk to us about the type of clients you work with? Is it agencies or do you actually work with? You know brands directly, or a combination of both?

Josh Lachkovic: 5:03

Yeah, it's all brands directly. They're mostly consumer businesses, all startups kind of series, a type level startups. So a couple of the big names, of the bigger names are people like Dishbatch, who are a restaurant meal kit. We work with Friarver, who I used to work with years ago internally and became a client when I started the agency. And then smaller companies who are much newer, people like Moveroots, who are a FMV not our colleague FMV brand. So, yeah, mostly consumer businesses, startups quite early in their lives who are growing digitally.

Will Ockenden: 5:39

And I guess this is a bit of a how long as a piece of string question, but is there kind of commonalities in terms of the sort of challenges they face when it comes to growth you know at the point when you speak to them or is it all sorts of factors that potentially limits their growth?

Josh Lachkovic: 5:57

It's an interesting world because every founder, if you ask them the question do you wish you were growing more? Probably is going to say yes, which is both a blessing and a curse for people who have a growth agency like I do. So we get a lot of people who might be needing to unlock that next level of growth. They've probably raised around the funding and been growing quite well, but to be able to raise their next round need to demonstrate whatever kind of a percentage increase that might be. It could be people who've hit a plateau and just can't get out of it or are struggling to grow and much lower. So typically people come to us when they want that next level unlocks and understand what that looks like.

Josh Lachkovic: 6:47

You know, I think they are brands mostly growing through paid social. That's our kind of core channel offering at the moment. We do other parts of the mix as well. We build landing pages and do retention work and stuff like that, but the core offering is paid social. So it's very much brands for whom that is their main channel. But yeah, likely would have hit some type of kind of plateau, looking to unlock that next level of growth and we'll probably start having a conversation with us.

Chris Norton: 7:13

So paid social right? Okay. So I've seen in your I've seen some notes that I've got down here from my assistant and it says that you said something about iOS 14 that it was a big opportunity. Now paid social for those of out there who have been in paid social since it came out or since it's been around, it was amazing. Conversion, conversion ads were amazing, they were brilliant, they were working great.

Chris Norton: 7:40

And then Apple decided to play this little update where the privacy got changed, so you had to opt in for advertising and conversion ads of any meta. Literally and I've done the math on this is about a tenth of what it was. So why is that a massive opportunity? Why have you put that some as it? Because everybody that I know that's worked a lot and I've listened to a lot of podcasts as well. On on the the outside of it, they felt it's really affected convert and I've seen it on multiple clients like whether it's still there. You could still get conversions from paid social, organic, you know, sorry, digital conversions, website conversion, sales but it's about a tenth, if not 20, maximum 20% of what it was. So did you think that was a good thing or a bad thing?

Josh Lachkovic: 9:34

I think, first of all, Meta have done a lot to improve that that kind of now. I think when you go back to when I was iOS 14. 14.5 came out that first year afterwards was a pretty Meta late last year, introduced something called conversions API (Cappy for short) and that's been rolled out kind of much more widely now, sort of earlier last year, and that has definitely closed the gap on some of that data. It's a bit more technical setup. So you know, historically Facebook advertising was great for, you know, anyone who wants to go test these channels out is really cheap to do, so you could install the pixel, no problem.

Josh Lachkovic: 10:20

I think the barrier to entry now is higher as a starting point. The cost barrier to entry is higher as well, like the era of you know, your local butcher shop or something trying out some ads to see if it's going to work. Probably is probably is over and the bigger players are still spending lots of money like that's. That's not kind of beat around the bush, for people who are spending money are still spending a lot of money, and they're doing that because they get the results from it the opportunity comes from, because I think it actually makes all of us better marketers. And you know, when I started doing Facebook ads in 2013 or something it was, it was more like PPC, it was more like doing paid search and you know it was very much like amending bids and duplicating ads and doing was quite like hacky, hacky stuff. It was very much like living in a cell document or day.

Josh Lachkovic: 11:14

And now it's gone back to first principles of marketing is why do people do things? It's understanding their behavior, their culture, trying to capture attention in milliseconds of time. You know that's that's a real big challenge today is how do you capture attention in milliseconds of time? And that kind of takes us to first principles of marketing, of really understanding, like how to sell stuff, what makes people tick, and as a result, when you get good at that, it's far better for the brands, because brands no more about their customers. They're going to have far better scale opportunities when they eventually get to doing TV or out of home. They're going to know so much more about their customers because they've been learning so much more. So from my perspective, it is an opportunity. It has also got rid of some of the smaller players on the platform, like some smaller brands aren't advertising now. So you do have that opportunity if you're willing to test and fail.

Josh Lachkovic: 12:08

To bring it back to the topic of failure so while you're learning then I think that, yeah, there's lots of opportunity there.

Will Ockenden: 12:15

So what I'm hearing is, or what I'm assuming you're saying here is, is the focus now more on creative and customer understanding?

Josh Lachkovic: 12:24

Yeah, that's exactly right. You know the advantages advantages you gain from what was once called media buying, or what we now guess. What you'd see is media buying a much slimmer. It's not dead, you know that goes to stand important, but the impact was as much slimmer. Whereas you know our team now we think more in terms of creative strategists as the heroes of those accounts, more so than the media buyers, and that's going to continue to grow. Like you know, we'd imagine it go forward two years. It'll probably very heavy skewed towards creative strategists rather than the media buyers.

Chris Norton: 12:59

So ROI? Then if we go to everybody's favorite thing, on paid social ROAS, what sort of ROAS was it pre iOS 14 and what ROAS? Because you're saying now it's great, I like what you're saying there. You're saying, basically, that the smarter people can still make campaigns work. It is more challenging, but better thought and better application of how people are acting could customers of aaving will still work, which is which is true, which is why it does still work, but not quite as good as before. Is that fair?

Josh Lachkovic: 13:32

Yeah, it's. I think the measurement piece has changed as well. Like we were very reliant on what you'd think of as last click attribution for most of the 2010s, so we would trust that last click. That happens and Facebook would say we got that conversion and Google would say we got that conversion. You kind of relied on that data a lot more as a reflection of how your channels were going.

Josh Lachkovic: 13:59

What we recommend now is to no data is perfect. You have to use multiple sources. There's no single source of truth. You know. Look at Facebook data to compare Facebook ads with other Facebook ads. Look at Google data to compare different ad groups to other ad groups. But in terms of measuring channel effectiveness and overall ROI, you probably need to do a slightly more complicated measurement than you would have done a few years ago. And so I think for bigger players who can afford to do that because it'll cost money it requires large amounts of data. That's why they're still investing in these channels, because they can trust they are working. So, yeah, the ROI is there. It might not look like it in the platform as much as it once did, and it definitely is more expensive to advertise there, but I think the ROI is still there. It just might not reveal itself in the same way.

Will Ockenden: 14:53

And you mentioned the smaller the mom and dad corner shops/ the SMEs used to really benefit from, particularly the acquisition side of Facebook ads. Are you saying that it's not for them anymore? It's not working for them

Josh Lachkovic: 15:12

I mean, I guess it's like what kind of scale are we talking about? I think any business that has raised money or any consumer business which has raised money has still advertised and gone there. It's kind of fine from that perspective. There are lots of bootstrapped businesses. One of our clients is Bootstrapped and he's spending 10, 15,000 a month on Facebook and they've got to that level themselves. But I think if you go back five or six years, you saw people who might be spending 1,000 pounds a month or 500 pounds a month on the platform and getting some results out of that, and I think that level now is much harder to do. You kind of need to probably need to be in a bracket saying let's commit 5K a month plus, or it's probably much harder to get there. So I think that's where it's dropped down.

Will Ockenden: 16:01

Shall we dig into some of the other social platforms? So we've obviously talked about Meta. We see significant ad spend going through platforms like LinkedIn, TikTok. What's your macro view of that market, then? Are other platforms delivering sales in a way that's more effective than Meta?

Josh Lachkovic: 16:22

Audience is really the kind of the termic factor. TikTok had a real moment in the sun last year. It was very cheap in the early parts of last year and so we did. Some of our clients I was working with directly at the time had some good success on TikTok last year. We're not doing lots of TikTok now and I think it's because most of our clients are advertising to probably like a 30 to 50 millennial kind of bracket. We don't have any brands who are primarily targeting, say, Gen Z or whatever people in the early 20s. That said, if you are advertising to that bracket, then there's a lot of scope.

Josh Lachkovic: 17:05

On TikTok, it is at that age group, cheaper probably than Meta to advertise on. Potentially not the scale, you have on Meta, but it is definitely cheaper. LinkedIn is a tricky one. LinkedIn, first of all, only is going to really work for B2B and it is much more expensive than Meta is. And we actually have B2B clients who are advertising on Meta rather than LinkedIn because it's cheaper for them. You have to think about, at the end of the day, a business is a group of people and your buyer at a business, even if it's a B2B, is still an individual, and I browse Meta and LinkedIn Instagram all the time. You get ads for marketing software and agency gurus who can help 10x my agency. I get all those ads all the time in my Instagram feed Gross hackers 10x your agency today in 30 minutes, watch this YouTube video.

Josh Lachkovic: 18:02

Yeah, you have to buy their course for $999 down to $10. And it will be fine by the end of this 24 minutes your agency will be worth.

Chris Norton: 18:14

So yeah, I've got a question. Ok, what about YouTube ads then? Do you do that, or did it just pay social ads?

Josh Lachkovic: 18:20

YouTube we see slightly differently. Youtube we see less as a performance channel, it's more of a brand channel, and so the types of creative which you need to run on those platforms are much more different. The types of ads you're running inside TikTok or Instagram are broadly the types of ads which you would see in your stories or your reels anyway, shot on a mobile phone quite scrappy, often quite scrappy, entertaining, subtitled with native text, that sort of thing. Whereas YouTube still has that slightly higher production value to it. It requires a slightly higher level of storytelling and for us it's just not a specialist at the moment. Long term it absolutely will be, but yeah, for the time being it's not a specialist for us.

Will Ockenden: 19:08

So, Josh, you've talked to us about the kind of the barriers to entry being a little bit higher for Meta. There needs to be. We need probably bigger budgets, more technical nauce, I know that a lot of marketers will be listening to this who probably previously did ads on Meta with great success, and they might have either reduced budgets on that platform or stopped altogether. Now what advice would you give for them? You know, should they jump in both feet again? Should they go all in? Should they look at other channels? You know where should they spend their money?

Josh Lachkovic: 19:42

If you're the type of business which doesn't have people searching for you, which is a lot of startups, like a lot of startups are creating products which people don't yet know they need, then something like Meta is still a really good channel for you, or TikTok or something else like that. You know, in the old days it would have been TV, but that's very high barrage of entry. The lower barrage of entries are still things like Meta, and they do still work for that, and so I would recommend them. I think the way you manage them is much different now. So I would you know things like audience targeting aren't really a thing anymore. You know all these complicated account structures aren't really a thing anymore, and so actually run things very broad. Use your creative as your targeting and whatever your creative looks like, make sure it appeals to your target audience.

Josh Lachkovic: 20:38

Answers a customers problem; like explain how it's going to solve a problem, and if you do that, you will find it working, if it does work for that channel. So, yeah, definitely don't swear it off as long as you're in that kind of bracket. That said, if you're a product which people do search for a lot. Paid search, SEO, are still things I'd definitely concentrate potentially first and then, longer term, think about paid social.

Chris Norton: 21:02

But you would say, because you write all the butcher's, baker's, candlestick makers out there, they would spend a thousand one thousand pound a month on Meta ads. Actually, now, if you're doing conversion ads, you need to be spending around about 5k a month and doing what you're doing, which is broad targeting, which is what a lot of people I've heard a lot of people say 'oh, broad targeting works better than' because it just went so niche, didn't it? It was really, really targeted and brilliant then it's completely reversed itself back out to broad again. So it's interesting. It's interesting.

Will Ockenden: 21:33

So the creative itself acts as the targeting. You know, those people that aren't interested in the creative naturally won't click through, and then I suppose you can retarget them, retarget the people that engaged with that initial creative. Is that something you'd recommend?

Josh Lachkovic: 21:48

Yeah, exactly. So Meta, specifically talking about that, has a new targeting algorithm called Advantage Plus, shopping Campaigns or ASC. For sure, ASC has removed loads of targeting capabilities. You can't even target based on gender. So we have ads which are selling products which are exclusively designed for women and we put them through ASC and Meta very quickly, within like a day, shifts that budget like 99% female, 1% male, and it's because the targeting the ads like talks to a woman. It talks very explicitly about problems that only, and actually only certain groups of women are going to be going through. So it finds that audience and within a few days you suddenly see the ages it's advertising too, most of the spends going into the age bracket you expect, it's going to the gender you expect. If it's kind of country specific, it will find that as well.

Josh Lachkovic: 22:42

But it does cost money to get there because it's got those first few days where it's just showing it to everyone. Men obviously aren't responding to it, and then the flip side obviously is you have products on the other side as well. But yeah, it's all about creative.

Chris Norton: 22:54

Interesting because it used to be that Meta. You know, take a few days for learning and then the learning would happen. But if you look at YouTube ads, for instance, apparently the longer you run a YouTube ad the better it gets, and it sounds like the broad targeting on the Advantage Plus like you're talking about there. It sounds like that's what's happening there. It's the same sort of thing that actually the longer the campaign you're not getting the ad fatigue that you used to get, it actually starts performing better. Is that fair?

Josh Lachkovic: 23:21

Yeah, to a certain extent. Yes, you do still get ad fatigue, but then at the same time, because you've got fewer campaigns and you know individual campaign might have, you know, a dozen or so ads in it which you know that could run for months, and so the amount of data in that campaign is massive and so it's going to be very hard for that to be beaten because it keeps on getting better and better at finding those people. So, yeah, it definitely does have an element of that which, again, is different when it was when I was starting advertising, when we'd turned campaigns on and off every hour or two sometimes to kind of game the system. So, yeah, it is a lot more similar to YouTube in that respect.

Will Ockenden: 24:03

Excellent.

Chris Norton: 24:03

So we've dived in a bit technical. I want to hear a bit more about your history, then. Because we're going to get to your, your fuck ups, let's get into it. So w here have you come from and you started in digital marketing, right? Is that right, Josh?

Josh Lachkovic: 24:17

Yeah, I started off. My first ever job was SEO and content writing inside a PR agency. Did that for a few years.

Chris Norton: 24:26

Was that Hot wire?

Will Ockenden: 24:36

You didn't get it, it...

Chris Norton: 24:38

I didn't know what dangling modifier was, so I didn't get it.

Josh Lachkovic: 24:43

Oh, is it? Do I know what dangling modifier is? Do you know?

Chris Norton: 24:47

In those days, they had an exam, a 30 minute exam and there was 30 people in the room and we're all going for the same job and the examiner went out. And I just turned around and went 'does anybody in here what a dangling modifier is?' and this guy goes, 'I'm doing further English at Oxford and I don't know what dangling modifier is' and I don't know if it was a trick question, but I had to Google it afterwards. But there you go.

Josh Lachkovic: 25:14

I didn't have to do that test, which I'm very happy for, because I'd have failed, yeah. So I got that job, I was doing kind of bits of copywriting and writing about tech for a few blogs and stuff like that. So I originally wanted to be a journalist, that was the first thing I wanted to be when I was 18. And realised there was basically no jobs in journalism so I started copywriting. I was always a nerd so I always built my first computer when I was 10 and I've just been a nerd ever since. So digital marketing seems like gel this nerdy techie stuff with this writing stuff together. And that was the job at Hotwire. I was really learning about SEO, learning analytics and GA and all that data and stuff like that. I did that for a few years.

Josh Lachkovic: 26:04

Got a taste for startup life because I really enjoyed kind of the startup culture of some of the companies I was working with. Went to Pact Coffee, which was just before they raised their SEO as a small team so went from an agency of 200 down to a team of 12. Did print marketing there. So a completely different channel; print marketing inserts, magazine advertising, stuff like that. Then went to the comms and kind of product role inside an education group, which is a completely different shift again. Did that for a few years, basically built a website for this business, started selling these online courses which was years before Covid - they probably would have done much better later on. And then went to join Frivor, which is a health tech, where I joined as their first employee and head of growth and that was 2017.

Josh Lachkovic: 26:58

And that was probably the real kind of start of that period of my career and over the three years I was there kind of learned more in three years and you probably do in 10 years in most businesses. Yeah, when I joined it was just the founders and myself and they had about 500 customers and by the time they left it was a 55 person team, 100,000 customers acquired, which myself and the team I'd kind of put together had been responsible for that. So learned lots there. Then went and launched my own startup. So had the bug, wanted to be a founder, had always enjoyed wine, had done a wine course, thought the way that wine courses were taught was backwards and once it's like bring it online and set up wine list, which started the podcast, then turned into a newsletter, then turned into kind of video content plus wine as a subscription. That was 2019. I went full time on it.

Josh Lachkovic: 28:00

Yeah, I went full time first of March 2020. Two weeks later, lockdown started.

Will Ockenden: 28:06

Okay, that said, is that not a good thing?

Chris Norton: 28:08

Yeah, because everybody was sat at home drinking wine.

Josh Lachkovic: 28:14

Our numbers did the kind of hockey stick thing. We went from 3000 pounds of revenue in February 2020. And in April we did like 25,000 pounds. It was 50,000 two months later.

Chris Norton: 28:26

That was basically the Ockenden's, they were just ordering in all their wine for the summer.

Will Ockenden: 28:33

So, yeah, it was absolutely brilliant. So okay, why are you still running it now? Yeah, what happened then? Don't mean to trigger, you.

Josh Lachkovic: 28:43

No, no, so it was a good thing, but it was also a real curse to that side of that growth, because it was unusual behavior for the market like that and it gave this completely different buying behavior where what we were selling, which was online video courses, group tasting sessions and wine sent to you in the post, was like the perfect lockdown thing, because everyone was at home, everyone was like wanting to learn more, everyone was drinking a lot more than they were historically, and so it looks like we were doing brilliantly. We went out and raised a load more money, went and hired you know three more people on the team, rented a warehouse, increased all of our cost base, like absolutely massively, and then pandemic started to filter out and every month restrictions came down. Our core attention was just just going down and down and down at the same time, and we spent 2021 essentially trying to find, realizing we didn't have what in startup world is called product market fit, which is the kind of notion that you've got. You've got a product which is solving a very large problem for a market which can sustain that business in it, and you know they say that when you have it. It feels like gravity is kind of you know you can't help but feel you've got it. And it felt like we had it in COVID.

Josh Lachkovic: 30:14

And then, as the world returns normal, it became immediately clear we didn't have it and so that year we tried loads of different things. We change the product rounds, we launched a kind of a single serve type portion, rather than like a bottle which went through your letterbox, so like packed coffee. But for wine, we launched like an event series saying if we can make events work as a thing. We went to a more strict, like econ model of just selling wines, so we're back to sustain itself. And then we tried just selling the courses, for digital courses as well, and basically all of these things just didn't end up working. And you know we were running out of money and tried going to raise some more money. But when your numbers have been flat for five months after hockey stick the year before, it's not a great investor story. So, yeah, we have the business shut down September 21. We were in the middle of a fundraiser and just didn't get enough money together to make the business work.

Chris Norton: 31:14

I mean there's a lot to unpack there. Fair play to you for sharing that. I mean that is a really honest assessment. And then that sounds tough, because running a company is tough. I feel you're pain there, so at what point did you think, fuck, this is it? We're going to have to shut the doors?

Josh Lachkovic: 31:33

I mean probably far too late, to be honest, but I should have done. The real turning point for me was about two weeks before we actually kind of shut the doors, and we were supposed to be raising around. We'd had some money kind of committed, or what I'd been in my head was committed, what I understood to be committed, which would have been about 200,000 or so towards around. Who tried to raise half million. And when it got to kind of mid September and I looked into that portion of money, there was a lot of kind of umming and ahing about when it would be ready and if it'd be ready and stuff like that. And that was the moment I thought, okay, I think this might be it.

Josh Lachkovic: 32:25

And I was at a friend's wedding when I had that call. There's that for more than a friend's wedding. So I drank a lot of wine at that wedding and I got my money's worth. And then the following week, yeah, to sat down all the investors who we had initially and these new investors and said, look where, where are we? And that following week it was a you know, they didn't have the money and so that was it. By that point we were in a lot of debt because we were kind of going on the assumption that the end of September we were going to have this money in the bank.

Chris Norton: 33:00

And they just wasn't the reserves there.

Josh Lachkovic: 33:02

Yeah, they weren't.

Josh Lachkovic: 33:03

So, that's when it actually happened. But just to just add in what I think I probably should have done, would you know. I think in hindsight I probably could have, I think there where probably signs earlier on. It's a really really hard thing to know, to choose when to stop, and to a certain extent I took the decision out my hands and just let the money run out. And I think, actually you know, I think if I was to do that again. There would have been signs going right - actually we've tried these five things - none of them worked. This business I believe to be restructured quite a lot and I probably would have known that three or four months earlier.

Chris Norton: 33:42

But you're an entrepreneur, you're fighting to keep the company going right. That's that's what we do as business owners. We keep, we keep going. We've got to fight. I get it.

Will Ockenden: 33:53

But also knowing when to quit. And from your perspective, how did that feel personally? Was there a sense of relief?

Chris Norton: 33:59

Or did you feel like failure?

Will Ockenden: 34:01

Talk to us about that?

Josh Lachkovic: 34:04

I had one of my early investors who was an angel investor. He was a founder as well. He called me up, I think, the following morning. I sent an email out to all the investors on Tuesday or Wednesday and he got. He called me up next morning and he said so you've fucking done it now and he realized none of it fucking matters. And it was like the best thing I could have heard, because you know, I had all these worries about I've lost all the investors money and all these other things. But that was that was kind of a really good piece of advice, for none of the fucking matters. I hope I'm allowed to swear on this podcast.

Chris Norton: 34:43

Mate, it's called fuck ups to fame. I won't worry about it, yeah we actually beep it out a lot of the time, but don't worry.

Josh Lachkovic: 34:53

You know that was really important. I think the bit leading up to that was the hard part in a way, like you know, so much of your identity is kind of built into being a founder and being an entrepreneur and you know it's like everyone knows you, as this person who's running this business was doing this thing and, and you don't know if it's unknown, is going to be like a beyond there. And actually, as this investor told me, beyond is fine, like it doesn't matter if you fucked up like you've, like you've learned from it and go and do the next thing. And you know I'm confident if I was ever to raise, do a business that needed to raise money again, he would probably be one of the first checks into that business. Now I've chosen not to go and do a business that needs to raise money again. But yeah, I think it was hard in that moment leading up to that decision actually wants the decision to be made. It was probably more relief after that moment. The tension was the months leading up to that point.

Will Ockenden: 35:47

And that point you mentioned actually about your identity being tied up with you know, with you being a founder. That's fascinating, and I suppose that is another factor that gives you more fear of the unknown, isn't it? You know you're seen as this person. What have you got if this ends suddenly tomorrow? Where does that leave you?

Josh Lachkovic: 36:09

Yeah, I think I've probably known I was, you know. I've probably wanted to, I don't know. Since I was a kid, like I always like sold stuff. I was always a person who like bought stuff at carboot sales and sold it on eBay in the early days and stuff like that. So like, I've always had this entrepreneurial side in me and just the thing which I've sold has changed a lot over my lifetime.

Josh Lachkovic: 36:32

And so I think one of the saving graces I had was, while wine has always been a really big passion of mine and remains a big passion today, it wasn't like my life's purpose to become a wine founder. It was like my life's purpose was to become an entrepreneur and it just happened that my first big venture was trying to do this wine thing. You know, I think the people who you know might kind of go down their passion route completely and then if that business fails, it's probably an even bigger knock for those people because it's not just like their identity as a founder but it's our identity, as like their whole life is about this thing, whereas my whole life isn't about wine, it's just a large part of it. So yeah, there's multiple levels to it, but I was probably quite lucky in that respect as well.

Will Ockenden: 37:20

And just a final question on that, let's assume lockdown didn't happen. Would that mean your business wouldn't have seen the growth and you may have given up, or would you have had more organic, steady growth than you'd still be a founder today? Have you thought about that?

Josh Lachkovic: 37:36

I have actually, I think it'd be interesting.

Chris Norton: 37:39

Gradual growth. You mean like, rather than the hockey stick, like a normal business that's starting out, grows organically.

Josh Lachkovic: 37:48

Like a profitable business rather than

Chris Norton: 37:52

It's going like that, you know, like the line's supposed to go up the X and Y axis properly. Do you think it'd still be there? Or was it because you had such quick growth, like Will says?

Josh Lachkovic: 38:02

I think I was searching for that then and you know I think I had just been in a business which went from 500 customers to 50,000 in the space of 18 months or two years or something like that. And you know I enjoy that, like you know my career in marketing, I've enjoyed making things grow really fast. Like I like it. I do just like it, and I get a good kick out of it. So I think I will always be motivated by the fast path to growth.

Josh Lachkovic: 38:33

But I think the business potentially could have taken a very different turn because if we'd gone for a few months without that growth, that would be in the signal that we need to change quicker and we'd have done so without the overheads of we've got an eight person team, we've got all of this stock, we've got all of this warehouse space, you know all this stuff which meant we were losing money every month which we took on to meet the demand we'd kind of hit. I think potentially we'd have had the space to change direction kind of much faster. So I don't know, it's impossible to say, but I think if it was to around it'd be a completely different looking business, for sure.

Chris Norton: 39:10

Okay, so today then. So today for Amphora. What do you do now then? So how has that affected your approach to how you do business now?

Josh Lachkovic: 39:24

I mean it's a profitable business from day one, like it's a cash flow positive business. Like I'm not going to take on investment like we did with wine list, which has kind of changed that systematically. I still want to grow like fast and big. You know, that's just in my DNA, I guess. Like you know, I don't want to be a boutique, small agency forever.

Josh Lachkovic: 39:49

I think the one thing which has really changed in my kind of behavior, or the biggest change I'd say, is I've got a much better grip of finances now than I ever had before. You know, I used to rely on a bit of kind of what accountants would say to me at the end of the day, and what an ops person would say to me and what a growth person would say to me or all these different people in the team. I would kind of listen to that rather than really dig in myself. And that was that probably cost me a month's runway. Ultimately when I was doing wine list, like without knowing that. So you know I probably, on an almost daily basis, know what our bank balance looks like, knows what cash flow looks like. You have to live and breathe it.

Will Ockenden: 40:37

That's the common theme. We've heard that from a few people.

Chris Norton: 40:40

A lot of founders. I hope this is a cathartic experience for you as well, because it is for me talking about these things. So some of the things you've talked about there are fascinating, like the fact that you've never taken funding. So Will and I, neither have we. We've never taken any funding for our business, and actually, when you talk about raising funding for growth. We work with a lot of consumer brands here and they need to grow, and when they need to grow, you have to raise funding. I've never been through that process of having to go to angel investors. What was that like? Did you feel like you were standing in front of Steven Bartlett and you having to do the dragons den thing? Or was it just write a formal proposal? This is what growth we've seen. This is where we're at, this is what we project, and please give me some money.

Josh Lachkovic: 41:23

It's a real mix and actually this is something which my clients now find very useful by a novice process. And so, excuse me, I've been able to talk about what the marketing is doing, what the growth is doing, but then also be able to provide that context for what investors are going to look for. So that is something which I think has been useful for them. In terms of what it's actually like though, some of it is like going in front of dragons den, some of it is super casual, like I went for a lunch once with somebody who was somebody I've done a partnership with in an old business and he'd been a founder, and I was just saying, 'look I'm going to do this thing, what should I do? How would you go about it?'. And at the end of that lunch he said I'll put 5K in, and I hadn't even paid for lunch. I was just like, oh okay, I didn't realize that's what this was, so maybe this is going to be easy.

Chris Norton: 42:18

And then if it's 5K investment every time. Carry on, sorry.

Josh Lachkovic: 42:25

Yeah, it was great. And then you would always have people who, whether they would do it consciously or really liked grilling you and say 'oh, what's your five year forecast?' It's like we're a three month old business. I can show you a five year forecast, but it's dragging the spreadsheet just 50 rows to the right. Like, if you really want me to do that for you, I can. So I think some people really enjoyed it.

Chris Norton: 42:52

It's an educated guess, is what it is. At that point, until you've been about for a couple of years.

Josh Lachkovic: 42:59

So it was a mixed bag. Some people super friendly, some people liked being pitched to and some people really grilled you, but for the most part it was a pleasant experience.

Chris Norton: 43:11

And so you've spoken about the business. What is the one big fuckup that you made at any point that you felt was the mistake, the biggest mistake you made? Or was it just that gradual thing? Because that sounds to me like what you've described here is more circumstantial. I don't class that as your fuckup. I class that as you got exceptional growth and I've got a few clients that had that as well. Exceptional growth, a period of bizarre times and everybody went online. We've got a number of online clients and they had exceptional growth and then it just went back to normal and so you haven't fucked up there. Was there anything you did feel that you did make a big mistake with?

Josh Lachkovic: 43:50

I think the fuckups were you know, entrepreneurs have to be optimistic. We have to believe that (A) we have some ability to make something good. That is an optimistic trait. And you have to believe that, despite all of the crap which is thrown against you and most businesses, all the data tells you businesses are going to fail on average. Every business on average is going to fail. Entrepreneurs believe that they are one in 100, or one in five or one in 20, whatever those numbers are, and so by nature, we are optimistic people.

Josh Lachkovic: 44:28

And that's part of that problem, which kind of falls into that like when things were good, I didn't sit in question why they're good. I didn't sit in question whether they'd be good forever. I didn't do that kind of okay, let's think about this three to three to six to nine months in advance. I just kind of let it be good and as it started to change as a result you know, things don't change overnight. It's not like one day our acquisition costs went out by 10x or retention went from 60% down to 10%. It didn't happen overnight, it was gradual. And so you know the first month that happens it's within a margin of error. In the second month, it's been a margin error. And then the third month it's like oh, it's January, it's dry Jan, that's why people are doing it. And then before you know it, your retention is 60% down to 40% and that's a troubling thing.

Josh Lachkovic: 45:13

And so you know the kind of not kind of questioning that early enough, and you know I didn't speak to enough customers and that was kind of part of the thing. It took me too long to adapt when that did change. And you know people talk about pivoting and startups like I pivoted within the realms of an educational wine product. And actually why I should have really questioned was, do people want an educational wine product? And the answer was almost certainly no. Like if you asked 100 wine drinkers do you want to know more about wine? 99 would say yes. If you ask those 99, will you spend an hour a week learning about it? It'll be less than one, it'll be like one out of 99. And our business required it to be like 20 of those 99 to be able to be a business who wants to build, so there was questions which I didn't ask.

Chris Norton: 46:08

If you met yourself 20 years ago today, what's the big one piece of advice you'd give you? Because obviously you were keen and eager young man, and you loved growing and you're a positive person. So what would you tell your 20 year old self today, if you bumped into yourself?

Josh Lachkovic: 46:27

I'd say you don't need as much security as you think you do. I think I waited a long time to start a business because I was worried I had a lot of anxiety around, you know what I needed when I started wine list. I worked up until the week before I started it, I was still working my old job, I raised money around my old job. Because I didn't have you know, money in the bank. You know I don't have kind of family money or anything like that to take six months off and work out what I want to do.

Josh Lachkovic: 47:03

But like I didn't start a business around another job properly because I was scared that you wouldn't be able to do it or a boss wouldn't like it, and I'm sure lots of bosses wouldn't like it. Like you know, I think I'd have said kind of trying to shake, shake that fear a little bit earlier than you did. Because I was, I don't know what 20, late twenties or something when until I kind of finally took that plunge and probably could have done it, you know a few years earlier. So yeah, I think kind of but in general, I think take your opportunity when it's there and say yes to all the stuff and you really lead into it. Don't be scared of failing. Yeah.

Will Ockenden: 47:45

And on that, so kind of just summing up then, lessons in failure. What I'm hearing is know when to quit, rather than sort of stringing something along, you know realizing it doesn't really matter if you do try something. It fails, your whole identity isn't necessarily bound up in it, and kind of knowing when to pivot and pivoting decisively. Is that fair in terms of kind of lessons in failure? Anything else you'd like to add to that?

Josh Lachkovic: 48:14

Yeah, I think you know, keep on. Keep on talking to customers. They'll tell you more than you'll get from any spreadsheet and I think that's easier said than done, because you don't want to. People don't like hearing negative stuff. Yeah, I think customers reveal a lot and I wish I'd done more of that when I was at WineList. I think I'd have learned faster.

Chris Norton: 48:39

Fascinating. That's good. So you've you've obviously just done 40 minutes with us talking through your fuck ups. If you were us, who would you next invite on our podcast to tell their story?

Josh Lachkovic: 48:52

Oh, that's a good question. There is somebody called Charles Instone who is the founder of a supplement company called Wild Dose. He's Bootstrapped's business, he sort of building in public, I think and he was CMO for like a CBD company for a long time.

Chris Norton: 49:15

Okay.

Josh Lachkovic: 49:16

Very, very smart marketer and doing really interesting things with his own brand as well.

Chris Norton: 49:24

Bootstrapped. Explain the term Bootstrapped? You've used it two or three times today.

Will Ockenden: 49:30

Sorry, this is startup jargon. Yeah.

Josh Lachkovic: 49:34

Bootstrapped is is meaning you haven't raised money from anyone, so you're you're doing it by pulling bootstraps and going and doing it manually the old school way. It's probably quite derogatory in many ways, but I think it's just become a term now.

Chris Norton: 49:50

I've not heard that. I've learned something today.

Josh Lachkovic: 49:53

That's good. Yeah, big and like the indie hacker community.

Chris Norton: 49:56

Have you got? Yeah, I was just going to say have you got? Do you want to

Chris Norton: 50:00

Where can people find you online Josh, if they want to speak to you about what you do?

Josh Lachkovic: 50:06

So the website is hello and for acom and for is a m p h? O? R? Acom. You can Google me if you can get my last name spelling right. I'm Josh Lachkovic. I'm on Twitter at Josh Lachkovic, and LinkedIn as well. It's just LinkedIn slash, Josh Lachkovic or whatever the LinkedIn addresses are. So yeah, it's just those two on Twitter and LinkedIn.

Chris Norton: 50:32

We'll stick your details in the show notes on the YouTube and on the podcast as well, so people will be able to find you nice and easily.

Will Ockenden: 50:41

So, thanks very much for that Josh. That was a little bit different to some of the podcasts we do, but a really fascinating story about startup lessons, failure and then some really helpful technical discussions.

Chris Norton: 50:51

I think we're going to get a lot of interest in this pod, to be honest. It was really good and thanks for sharing and being so honest, and yeh really interesting and great to meet you

Chris Norton: 51:03

Yeah, thanks for your time.

Josh Lachkovic: 51:03

Yeah, thank you, that was a real pleasure. I really appreciate it.

Chris Norton: 51:12

Well Will that to me, is the best podcast we've done yet. And I'm not saying that because me and you are brilliant, which obviously we are.

Will Ockenden: 51:22

And no discredit to any of our previous guests, worth mentioning. Thank you for everyone that's appeared on the show so far.

Chris Norton: 51:25

Yeah, and thank you for listening. I just thought Josh was so honest with everything that he had to say about failing and being an entrepreneur and having a business that's struggled for various reasons. It was fascinating, wasn't it?

Will Ockenden: 51:42

It was, and fairly unique circumstances actually to how the business grew and eventually closed, and I think the other side of it was he brought real value to our listeners in terms of some of that technical ads focused activity. So yeah, absolutely fascinating and I think certainly from a Meta ads targeting perspective. You know it's been fairly turbulent the last two years, hasn't it? So I think a lot of marketers will be listening to that with interest.

Chris Norton: 52:07

Oh yeah, there's so many marketers out there struggling with paid social since iOS 14. It's why I opened with the question on why he felt it was an opportunity. I just haven't seen the opportunity to make it work. It still works, but it is so much tougher. But his attitude to it is was refreshing and quite interesting to hear.

Will Ockenden: 52:27

And as a creative agency, or rather you know, a creative integrated agency. It's really refreshing to hear actually creative is down to the quality creative rather than just technical nuance - that's going to get consumers engaged.

Chris Norton: 52:37

Yeah, don't just do it. And also don't have really complicated structures and targeting, because that doesn't work anymore, which is let's face it, the way that it was being done 18 months ago and it was working brilliantly. Then overnight, it just didn't work as well and now it's broad, broad, broad and all down to clever, strategic, creative and how people act. What is the customer going to do? I also thought it was interesting about when he was mentioning the advanced plus targeting, where it picks out using AI. Obviously, AI comes into every podcast for some reason that we're doing at the moment and then decides where the audience is. I thought that was interesting because it never used to be that way.

Will Ockenden: 53:14

And that's a seamless plug for our podcast two episode a go with Andrew Bruce Smith that really dug into the role of AI in marketing.

Chris Norton: 53:22

Yeah, AI. Well, we're going to be covering it again because obviously it's massive, but Andrew's podcast was interesting, so check that out the interview with Andrew Bruce Smith. But yeah, Josh had some fascinating things today that he covered. Definitely have to get him back on the show in like a year's time or something, find out where he's going, because growth hacking is an interesting area and he definitely had some interesting things to say.

Chris Norton: 53:45

Well, thanks for listening everybody, thanks for listening to socially unacceptable. Thanks for listening. And don't forget that we also run a series of free webinars and seminars that you can attend absolutely free. You can find them by googling prohibitionpr. co. uk and just click on upcoming events, It's near the podcast section. You can't miss it. Upcoming events, all free. You can register online, nice and simple.

Chris Norton: 54:08

Also, i f you want to subscribe to us on YouTube, you can get notified of every video that comes up. If you found this one on Apple podcasts or Spotify or whatever, we are actually available on YouTube and you can be notified of every video that we do. So, please do subscribe to us and you can find us on YouTube under Prohibition PR. Yeah, and as always, if you've got a fuck up that you've been involved in and you want to share with the show and you feel that you'd like to share with the world. Honestly, feel free to send that in and we'll do our best to share it with everyone. But until next week, we'll see you soon. Thank you very much.

Will Ockenden: 54:43

Thank you very much.

Vicki Murphy: 54:47

Thank you for listening to socially unacceptable. Please remember to subscribe to the podcast and leave us a five star review. Don't forget to follow us on social media on Twitter and Instagram at ProhibitionPR, we would love to hear some of your career fuck ups, so we can share them on the show. For more information on the show, search Prohibition PR in your search engine and click on podcasts. Until next time, please keep pushing the boundaries and embracing the socially unacceptable.