The Portfolio Brand Trap (And What We Learned The Hard Way)

Hey everyone,

Welcome back for another bite to chew on.

Today's newsletter is a different one. 

It's a story of failure – our failure. 

We've never really talked about this publicly, but we recently made the tough decision to sell two brands we'd tried to build alongside Obvi: Paw Rangers and Coffee Over Cardio.

Want to hear something painful? We personally invested tens of thousands of dollars into these ventures. And lost most of it.

But we think there's value in sharing this story. Because if you're an ambitious builder or a successful founder, you've probably had that same thought we did:

"Damn, I'm really good at what I do. I could probably do this again."

Sound familiar?

On the Menu:

• Why we tried to build a portfolio (and where it went wrong)

• The expensive lessons we learned

• What we'd do differently (if we did it at all)

Before we get into it, here’s another quick story of how we stumbled on a new way to scale our ad spend…

When someone claims they can double your Meta ad spend while maintaining efficiency, your BS detector probably starts going crazy. 

I get it - that was exactly my reaction when Alex (founder @ Proxima) first approached us.

But he just made an offer that's impossible to ignore: The Efficiency Guarantee™️

👆 The proof is in our account. We spent $662K+ via Proxima with better CPA and ROAS than our broad campaigns. 

If we had scaled that spend into just broad, efficiency would have tanked (trust me, we’ve tried).

That’s not a one-time win either - we've moved 50%+ of our total Meta spend over to their campaigns.

We know testing new tech can be challenging, especially when Meta has been volatile. But Alex has completely de-risked it with a money-back guarantee.

Here's the deal: Run a 14-day test putting Proxima against your best campaign. If Proxima loses? Alex will personally cut you a check reimbursing any lost revenue. 

🧠 Why this is a no-brainer → 

✅ Zero risk - they reimburse any revenue gaps

✅ Quick results - tests typically conclude <10 days

✅ Better data, better performance - their predictive data enrichment is driving massive results for Obvi and other high-growth brands like Marine Layer, Dagne Dover, ProLon, Hint Water, Coterie, and Caraway.

Everyone thinks creative volume and broad targeting are the only ways to scale Meta. But you should be testing new approaches just as aggressively - especially when there's ZERO downside.

Only catch? You need to:

• Be on Shopify or Shopify Plus

• Avg. ad spend >$50k/month

If that's you 👉 Apply here 

The Siren Song of Portfolio Brands

Here's how it started →

Obvi was crushing it. We had a lean team, solid systems, and explosive growth. So naturally, we started looking around thinking "What's next?"

Part of it was greed (let's be honest). Part of it was that natural itch builders get. And part of it was honestly ego. We wanted to prove Obvi wasn't just a one-hit wonder.

Nobody wants to win just one Super Bowl, right? 

So we launched Paw Rangers. Our thinking was simple…

• The pet space is huge

• The target audience is passionate

• Most people are willing to spend money on their pets

• We know how to build brands

What could go wrong?

Plot twist: Everything.

Instead of the intentional, community-first approach we took with Obvi, we went the complete opposite direction:

• Whipped up a quick website

• Found a contract manufacturer

• Slapped on some basic branding

• Got some product photos from friends

• Started running static ads

We figured we'd just press play and watch it grow like Obvi did.

**Narrator: It did not grow like Obvi did.

The Slow Burn of Reality

We started with $500/day in ad spend, thinking "We'll test this for 10 days and see what happens." 

(But also secretly thinking, “this is going to crush.”)

That first $5k? Gone. With barely anything to show for it.

So we did what any ego-driven founder would do – we put in another $5k. But this time we told ourselves we'd be "more careful" and "more intentional."

The worst part is everyone was watching. 

We'd told our 3PL, our friends, and our network that we were about to blow up another brand just like Obvi.

But it wasn't working. At all.

Naturally, Instead of admitting the problem might be us, we:

❌ Blamed the product

❌ Blamed the market

❌ Blame the sales channel

❌ Blamed everything but ourselves

Then we…shifted to Amazon (without really trying there either), because hey maybe it just needs to get in front of shoppers, right?

(Wrong.)

The Expensive Mistakes We Made

This is where we should have stopped and taken time to reflect.

We...bought another brand instead.

When a friend offered to sell us Coffee Over Cardio, it seemed perfect → 

• Already doing 7-figures annually

• Came with big licensing deals (Fruity Pebbles, Dippin Dots)

• Included $100k+ in inventory

• Had an existing community

What sold us was the price tag. Low 6 figures. 

Seemed like a steal.

"This time it'll be different," we told ourselves. "We're not starting from scratch – we just need to keep it running and grow it."

Looking back, we skipped even the most basic due diligence. We never investigated why their subscriptions were declining or ran the unit economics. We didn't consider how complex the operations would be or think about whether we had the mental bandwidth to take it all on.

And then reality hit. Within weeks, we found ourselves hiring community managers and brand managers, adding way more operating expenses than the previous owner ever had. 

All while watching our costs per order climb steadily upward with basket values that refused to budge.

Here's what we learned about selling coffee (after we bought a coffee company):

The math just didn't work →

• Average basket value caps at $40-50 (practically nobody buys more coffee than that)

• Meta customer acquisition costs start at $15-20 minimum

• Heavy product = expensive shipping

• Coffee COGS aren't cheap

But we never ran these numbers before buying. 

Because we were too focused on proving we could do it again and chasing that portfolio dream.

What Actually Matters in Building Brands

After burning through tens of thousands of dollars of our own money, we were painfully reminded about the fundamentals of brand building → Intent + capacity + due diligence.

Intent Matters More Than Experience 

Just because you've built one successful brand doesn't mean you can phone it in on the next one. 

The intention, passion, commitment, and hard work we put into Obvi weren’t just nice-to-haves. They were everything.

The Operations Tax is Real 

We pride ourselves on running Obvi with less than 10 people. But trying to stay that lean while building a portfolio is a recipe for disaster. 

All those "small tasks" add up:

• Customer service that builds relationships

• Community management that creates belonging

• Subscription management that drives retention

• Product innovation that keeps you relevant

• Content creation that feeds the algorithm

Capacity limits are a thing. Mental bandwidth is real. 

Even if you have physical hours available, building brands requires intense mental and emotional energy. 

We had zero true passion for these new ventures – we were just going through the motions, thinking our intuitions and past experiences would be the key to scaling. 

Nope. 

Knowing The Numbers Isn't Optional

It's called due diligence for a reason. Whether you're starting something new or buying something existing, it's never as easy as it seems. 

Don't let your confidence override the need for proper analysis.

No matter what you’ve accomplished, you can’t superman your way out of bad fundamentals or lousy margins.

Sum It Up

So yeah, we failed. Not because the opportunities weren't real, but because we thought success with Obvi meant we could skip steps and cut corners.

We confused having a playbook with having the bandwidth to run it. Our excitement about Obvi’s success led us to believe we had unlocked some secret. 

But there’s no secret. It’s just thoughtfulness, commitment, and hard work.  

The real irony is that the same things that made us successful with Obvi – attention to detail, community focus, and operational excellence – are exactly what we ignored with these new ventures.

So what now?

We're selling both brands and focusing 100% on Obvi. Because we've learned that doing one thing extraordinarily well beats doing three things halfway.

Remember: Just because you can start another brand, doesn't mean you should.

But if you do, be sure to know the numbers, be committed to the vision, and be able to build a killer team that will be able to execute. 

Before you go…Do you want to keep more of the money you make?

I (Ron) am joining some other heavy hitters (including Obvi’s own Ravi) to talk about the unsexy but vital stuff you run into while running a brand.

Namely, operational efficiency.

It’s hard to make money in business, but it’s really, really easy to spend it.

We found that out the hard way at Obvi and have since built guardrails and systems that help limit waste and cut out the silent profit killers that haunt every DTC brand.

Grab a free seat for our panel discussion on February 11th if you want to learn the tactics we used to save over $1.6M in a single year.

All the best,

Ron, Ash & Ankit