Podcasts

CT Expert Insights: Scaling an Online Business with Davis Siksnans

When an online poster store wanted to expand its product offerings to include custom printed t-shirts, the owners couldn’t find a company that met their exact needs. So they decided to do it themselves. The result was Printful, a print-on-demand service offering warehousing and drop-ship fulfillment. Printful currently has over 800 employees, over $75 million in annual revenue, and five fulfillment centers (three in the U.S., one in Europe, and one in Mexico).

Printful Co-founder and CEO Davis Siksnans discusses what it took to scale a small start-up into a global enterprise, from marketing and generating cash flow to navigating local laws and regulations and saying yes to more efficient business practices. Learn more about how to scale your online business below. 

 

TRANSCRIPT

Greg Corombos: Hi, I'm Greg Corombos. So our guest this week on Expert Insights is Davis Siksnans. He is the co-founder and CEO of Printful. Not only was Davis able to turn this idea into a business, but Printful now has more than 600 employees, enjoys more than $75 million in annual revenue, and is about to open its fifth fulfillment center. He joins us now to explain how he turned his idea into a booming business and how you might be able to turn your side gig into a business bigger than you can imagine, as well. And Davis, thanks very much for being with us.

Davis Siksnans: Thanks for having me.

GC: And Davis joins us from Latvia for this conversation. Explain first of all, Davis, what Printful is, what kind of a business it is and how you got the idea for it.

DS: Printful prints t-shirts and other print products for online stores. We specialize in printing, no minimum orders. So we can print just one product and ship it directly to the customers of our buyers, our customers, our online sellers, people who sell t-shirts and other merchandise on their own sites through Shopify or Squarespace, or on eBay, Etsy and marketplaces. So we drop-ship directly to the buyer. And we essentially make it really fast and cost-effective for someone to start an online business because they don't have to invest in printing equipment, having warehouses, hiring employees to do all that stuff for them. And we got that idea, because we, too, had our own online store before Printful. It's still around, It's called Startup Vitamins. And we sold posters, and we printed them on demand from one of my co-founders home in LA. And we wanted to just sell and expand into a [unintelligible] and we were looking for a good company that's going to be able to print t-shirts for us on demand. And we just couldn't find one that would do it in a fast manner, which is important for ecommerce. We would have quality printers and also would integrate with our own ecommerce platform at a time which was Shopify. So because we couldn't find a company like that we decided to start our own, and that is how the idea of Printful came to be.

GC: Very interesting. What were the biggest challenges in getting the business off the ground?

DS: Well, as you start new things, so one of the early challenges is obviously how you can market to some of your first customers. So luckily, in this case, this was not our first business. So our existing business Startup Vitamins, which gave us an idea for Printful which was one of our first marketing channels. We just emailed everybody on the mailing list of Startup Vitamins with our idea Printful, because you can now start your own online store similar to Startup Vitamins. That helped us get some of the initial traction. But the most meaningful thing that I would say that helped us fast was tapping into the large ecosystem of existing customers. out there on the internet, much like you would tap into app stores ecosystem for people who want to build app-based businesses. In our case, our target audience was online store owners. And at that time, and still to this day, one of the big best ecosystems for that is the Shopify app store. And Shopify is one of the most successful Canadian businesses by now and really successful public company now. And they have more than a million active store owners on their platform. So we launched an integration there. And that really has propelled us to the next level. We were able to get a lot of customers from their customer base.

GC: We're talking with Davis Siksnans, the Co-founder and CEO of Printful. And Davis, you mentioned that you had a partner in Los Angeles. I don't know if you were based there at the time or whether you were based in Europe like you are now. But did you run into a number of compliance issues having customers in all different places and setting up different shops in different places? Or is the fact that it's essentially an internet business mean that you could set up shop in one spot and then only have to meet the laws and the regulations of that particular place?

DS: There were not a lot of compliance issues at the time. You just have to be aware as a business who operates in physical products, in our case, t-shirts and other products, you have to be aware of the local laws that are relevant to you. In our case, we started in California and LA, so you have to have nexus in there. So it was important for us to make sure we charge the sale tax. And in terms of compliance back seven years ago, sales tax is different. You only had to charge sales tax only for the states you had [a] presence. And in our case, it was California. And our software development theme and other themes were always in Europe. And in Europe was kind of -- I'm laughing -- so it's kind of the whole market. We never had any issues there. We knew all the local regulations there.

GC: So at what point did you realize what this business could become. It sounds like you realized that fairly early. But what was the moment?

DS: I believe we had a product market fit from the very start. One thing I suggest to entrepreneurs is not to be afraid of charging for your product or service from the very first day. And that's what we exactly did. We were not afraid to set prices that would help us generate meaningful cash flow. And in the first month, we already made 800 dollars. Next month, it went up to 1600 and just kept doubling every month from there. So, you know, we probably really realized that we made something big that in less than three months or so Printful became larger than our existing business Startup Vitamins at the time.

GC: You mentioned the lessons that you would pass along to other folks, including charging for your talents and the work that you do from the very beginning. But give us a little more idea of the advice you would give to someone who thinks, well, maybe my side gig that I'd like to do really could turn into a business. What are good ways to gauge that before you invest a whole lot of your money into a business, to make sure that it is something that can succeed?

DS: We were really inspired by the book Lean Startup when we launched Printful. So we had a history of launching new businesses. And that's essentially the thing we wanted to do. We want to minimize the investment it takes us to test a new idea. So actually, the first version of Printful was just a landing page that explained the business to potential customers, and somebody could land on that website and sign up by entering a password and email. But after they did that, they were presented as a survey. And we basically gauged interest that somebody wanted to buy the service called Printful. And then we serve them a survey that informed us which exactly the products the potential customers were the most interested in. And turns out that we thought that those who are going to be posters because Startup Vitamins was heavy on posters. But you know, a lot of customers voted for t-shirts. So that has made us change our initial strategy a bit. So one thing...just launch a landing page, direct some traffic to it. Maybe you have an existing service or website like we did with Startup Vitamins. If not, you can buy some advertising on Facebook or Instagram and survey potential customers. And that's how you sort of understand if there's a need or interest in your business idea.

GC: And so that's an important thing. It's not just a gut reaction or a few friends telling you that this would make a good business. You got to put a lot of work in before you actually pull the trigger.

DS: Yes, if you can. It's not always a perfect system. But this helps you to not build something for six or nine months, which is in a lot of cases you have to do in software, without not validating any sort of interest from potential customers. And if the surveyings are really good, you will build the better version of the first initial product by taking into account what the customers responded to in that survey.

GC: Davis just a couple of minutes left in our conversation here. And this is kind of a cliched business question, but sometimes it can be very helpful to folks. What's the most important mistake you made? In other words, the one you learn the most from?

DS: Well, luckily, we haven't made too many mistakes. But one thing that we should have done differently is that coming from Europe and starting out in the U.S. was to hire a local HR manager slash director sooner. For too long, we as co-founders. wanted to do all of the hiring and HR aspects of running a business ourselves. And that is the part where the compliance is pretty important. So don't be afraid to hire an HR person, sooner than later. They're going to help you tremendously to focus on business growth by taking care of all the laws, etc. And for us, it's also they, you know, they were kind of our guides to how sometimes European culture is different than American culture. So, we should just really hired an HR person sooner. And once we did, we were really lucky that we were able to focus more on a business growth again.

GC: And of course, it's important to envision what you can still become even if after you've achieved quite a bit of success. I mentioned at the beginning you're at 600 employees or more, tens of millions in revenue, and you're about to open a fifth fulfillment center. What's your vision for a few years down the road from now? What will this company look like?

DS: Well in last year, we already started this journey of internationalization. So for six years, we were really focused just in the United States. But last year we added new languages such as Spanish and adding new currencies to just euro to localize in Europe. So our vision in the future is to become a global leader in our industry, a global leader in print on demand. And to do so we have to open up new international locations in new countries, add even more languages and more currencies. And that is exactly what we plan to do this year.

GC: Fascinating. absolutely fascinating. Davis, congratulations on all of your success. And thanks for sharing some of the secrets so that success with our listeners, we really appreciate it.

DS: Thank you for having me.

GC: Absolutely. Davis Siksnans is the Co-founder and CEO of Printful. I'm Greg Corombos. This is Expert Insights.

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