Why I spent $1,000,000 buying everyday.com

What's the benefit of brand owned media?

EDC and Us :)

When we launched Ridge, we were broke.
It was 2012 and there wasnt funding options for ecom companies.
Ecom was niche.

We had no network, couldnt even get credit cards.
So we went on kickstarter

It was the kickstarer era!

Facebook ads were new and cheap.
No one had gotten scammed yet…
It felt like a new avenue of entrepreneurship was just unlocked.
Communities coming together to bring products to life.

MAGIC!

And the community that supported us on kickstarer?
The Everyday Carry community.

What the hell is that?
Its a group of people who obsess about the tools they carry with them everyday.
Check out the sub reddit. If you dont know about it, it wont make sense to you lol

Like any community, it is full of strong opinions.
People will fight over the BEST flashlight for every type of situation.
They could name 2 dozen brands, the pros and cons.
They are forum enthusiasts, posting reviews and photos about their hobby.

And they loved our wallet.
They shared it on forums and in buying guides.
We wouldnt exisit as a company today without them.

The Business:

Everyday Carry (EDC) started as a tumblr blog, ran by Bernard, the editor in chief.
It was an outlet for him to share his favorite headphones or pliers.
(He is also very funny on twitter)

Some tech partners stepped in and tried to build the Men’s Pinterest.
That didnt work lol

So for a few years the tech partners just tried to juice EDC for money.

When Ridge reached out to buy them, things were stagnant.
Revenue was flat, traffic was flat, community was shrinking.

At one point EDC was the COOLEST gear publication, but the focus on revenue made it less cool.

Enter uncrate, cool material, gear patrol…
They took EDCs top spot.

Deal details-
The reasoning behind the deal below.

Revenue Model:

How does EDC make money?
Two main buckets:

• Affilate commission

  • The most steady bucket of revenue

    • $1,000+ every day

  • Mostly from amazon, but also through more direct affiliate programs

• Ad sales

  • A less predictable bucket

  • One off ad sales to brands for launches, PR, direct sales

  • Makes up over 50% of the revenue

  • Ongoing yearly deals with top brands

    • Casio, Leatherman, 5.11 tactical

Deal terms:

EDC was in a steady, slow, decline.
Costs were low, Bernard was a contractor at this point and the whole thing ran on freelancers.

EBITDA was like 400k trailing 12 months.
Thats what the tech partners were splitting.

We got EDC for 1m, cash up front.
So already, a very low multiple.
But then we had to plan the future.

Future

We bought an asset that makes 400k a year in profit.
But, in its current state would it survive 3 years?

More importantly, ridge doesnt care about 400k.
How can we get 40 MILLION worth of value out of this?

Plan:

• Make Bernard the face of EDC

  • Original founder, most knowledge gear guy I know

  • Brought him full time into ridge as VP of EDC

  • Get him involved in Ridge product decisions

    • He knows what makes good products, have him help us make the best stuff

• Build a team

  • 2 contractors were running all of edc

  • We hired 8+ people to build out the org

• Rebuild socials and community

  • Social was neglected

  • We are building a team to scale shortform and youtube reviews

  • Community was in an okay place, facebook group and discord were live

    • But we are going to spend 10k+ a month to grow engagement here

• Rebuild the website

  • the website was a custom build from 2013

  • It should just be on wordpress lol

• Get our credibility back

  • No more affiliate shilling, no more bad sponsored emails

  • every day we need to put out 2 HIGH QUALITY journalistic pieces

  • Become the trusted source again

• Grow traffic

  • 12 month goal to surpass 1m monthly uniques

Value for Ridge:

Hey this is a ton of fucking work.
Why do this?

• Data

  • EDC drives a million+ in sales every month to amazon, thats where the affiliate commission comes from

    • So we have MILLIONS of dollars and YEARS of buying behavior in front of us

    • Essentially solved our product roadmap

• Knowledge

  • When you hire someone, you often screen for competence, but do you ever screen for passion?

    • People can learn new skills in weeks/months, but you cant learn to be passionate about something

  • Ridge hires the BEST people, but sometimes those people dont really know about gear

    • Buying EDC guarantees us an inflow of passionate gear people into the business

    • Now we are surrounded by writers who live and breath the stuff

• Credibility

  • Yeti taught me you need to win over the Pros to win over the masses

    • Yeti sponsors bear hunters and fisherman to give their product the authenticity to sell to the backyard BBQer

  • Owning EDC puts me in the room with the most passionate consumers

    • I hear what they love and what they hate every day

• Access

  • Now I can get press passes to any event

    • Thats cool lol

  • But more importantly, if there is a brand we want to talk too, we have a PR trojan horse

  • We already get sponsorship dollars from the biggest outdoor brands, now they get to hear about how cool Ridge is at the same time

• PR Flywheel

  • PR needs a kick to get started

  • Now every launch for ridge gets that PR kick

• Product launches

  • Every launch we do gets sent to hundreds of thousands of gear heads

  • New product launches have gotten 5x as successful

• Publication ad accounts

  • We now have a new ad account to run paid content through

    • One with built in community and cache

• Audience

  • Paid ads are only going to get more expensive

  • Buying a publication is a hedge on cost per impression

  • EDC will get a million monthly unique visitors in a few months

    • Cost? Just what it takes to produce the content :)

• Multiple

  • We bought EDC for less than a 3x multiple

  • Ridge would trade between 8-15x

  • So buying EDC ads enterprise value to the business

    • Profit is profit after all

Conclusion:

EDC cost 1m upfront.
But it operates in the red right now.
That 400k in profit, 33k a month, is being put into the publication.

Our goal is to get EDC to 1m monthly visitors and 100m monthly views on social.
Building that takes time and money.
We want to build the best gear publication ever.
And the longterm benefits for ridge are huge.

Product data, PR, revenue, traffic, connections.
Brand owned media is a powerful tool.
But it is a lot of fucking work.