How Thesnapbar CEO Sam Eitzen grew Thesnapbar to $7M revenue and 10K customers in 2024.

hello everyone my guest today is sam eisen he's the co-founder and ceo of snapbar an inc 500 company that uses photo and video experiences to help planners producers and marketers create better engagement at events he also co-founded keep your city smiling a gifting company that supports small businesses struggling as a result of the pandemic sami ready to take it to the top yeah obvious question pandemic means no events no events means no photo booths what are you spending your time on today yeah two pivots uh keeper city smiling being one of them we took our team and moved to sell gift boxes to individuals which then resulted in us finding that companies and a lot of our corporate clients would actually do great with large orders to like work from home like so basically care packages for their team members and then we also developed a virtual photo booth uh software that we are using for a lot of virtual events that our clients have pivoted to interesting so when you were so let's talk pre pandemic for a second give me a sense of scale of a company what'd you do in like 2019 total revenue yeah about 3 million in 2019 on track to do four to five 20 20. um we at four photo booth company were pretty big i mean quote unquote right like it's a pretty small industry and yeah our events were primarily about 85 of our revenue was corporate 15 was private events like social events weddings et cetera and what do you think that so now let's break down 2020 let's say you do hit 5 million in revenue what's the breakdown oh goodness probably the breakdown would be 70 percent keeper city smiling i you know to be clear i don't think we're going to do 5 million we've been hit pretty hard revenue dropped off a cliff but if we did yeah 70 keeper city smiling and 30 virtual photo booth it's a new piece of technology a lot of people don't even understand what it is uh but it's basically like a browser-based photo booth that is a fun add-on to virtual events that at times can be boring well sam i mean dive into this this could not have been easy i mean 2020 i mean you're on a freaking rocket ship you're earning awards like crazy are you bootstrapped or did you raise we're bootstrapped okay well that that at least gives you a little bit more flexibility but it's still painful as heck i mean so walk through i mean march comes around things start shutting down you probably start getting cancellations and imagine what february late february right floodgates open up uh we noticed the first massive hit to our company when south by canceled south by southwest they were we were activating there at a bunch of different uh events and sub events and that was a pretty big blow after that yeah mid-march the floodgates opened i think we lost about three to six months of earned or like potentially earned income overnight and sales since then have continued to be just absolutely dead and not only that but we had refunds to give we take deposits if we don't do any work for your event and it's further than 30 days out you are owed your money back so we bled hundreds of thousand dollars in the when that first started happening which is why we had such a significant and kind of like aggressive pivot outside of the events industry we were so pessimistic about when they might come back that we felt if we didn't do something that could earn cash fast uh we would have to lay off our entire team and e-com e-commerce was kind of our our guess that that might work what we were surprised by when we pushed to e-commerce was that again it was these brands big companies like microsoft google that would purchase 200 300 800 boxes in one go brand the boxes and send them to all their you know people on various departments and teams working from home and so we were spending so much money acquiring individual customers on social media that we kind of have shifted focus and said you know what we're going to be a corporate gifting company that focuses on connecting big brands to local businesses local vendors what hence the name keep your city smiling right it's a gift box company but the twist is that it's very intentional and it only supports small business let me make sure i understand that i want to dive sort of more into how you've done this i mean this is a remarkable pivot uh if you're able to pull it off so if microsoft is in seattle and they want to support a local small business hit hard by the pandemic let's i'm going to make this up let's say it's a it's a local like picture framing shop a mom-and-pop shop they weld metal picture frames together microsoft would essentially buy 800 custom done metal frames from the local small business and then ship them internationally to all the microsoft employees as like a gift that is basically what can happen what the one step that is kind of work that we're making it easy is that we're selling or packaging a keep seattle smiling box for microsoft's seattle employees but i'll take another company another tech company for example that had headquarters in new york austin san francisco and seattle they were able to buy 800 boxes and ship them to every single employee that were based out of those cities with five small business products like craft coffee tea chocolates from the cities where those people were based to connect them to local brands and vendors but because we also uh like customize and curate the contents it's absolutely possible the minecraft microsoft say hey we really want this we really want you to find a small business vendor that makes cute little metal picture frames please include that and we handle the logistics we brand the box we we tell the story as well of maybe the founder or founders behind that little metal picture frame company and try to connect the people in seattle um or globally i mean it really depends right to like the story of those small business owners gosh building the logistics to i'm trying to think about what could you reuse from a photo booth company to source local small businesses to find products that you could sell to bigger enterprises in those same locations to sell back to the local employees like that doesn't seem like there's a lot of reusable technology there not a ton i'll tell you there's three pieces of technology we're using where we had a big printer that wrapped photo booths that we used to brand the boxes meaning we can control branding um and printing inside the in-house we have we use old school photo booth printers to print strips and that's where we tell the little stories we call them who you're keeping smiling um or who you're helping smile i can't remember exactly the terminology that kind of profiles the the vendor or the the founder and then we have a we had a warehouse that used to store and ship photo booths and now it's been transformed into a box sending business but that's about it the team had to pivot and i mean not pivot's a weird word but you know had to completely transform what they were doing and people that were wrapping and branding photo booths spent eight hours a day folding cardboard boxes it was not glamorous this is incredible my gosh has anyone has anyone interviewed you like hardcore about this to capture this sort of full story we've done some like we had an ink profile we've had a couple like forbes and uh you know like articles written about the pivot um but no well what do you think that what do you think so you've talked to like traditional reporters and all that what do you think all of them have missed about the story i think it takes someone who understands business and entrepreneurship to realize just how drastic the switch was so pivots are a very sexy thing right but pivots are often here's what i used to do in person events and i've pivoted to virtual events but our pivot was really more of like i don't know i mean i don't even know what if it's considered a pivot necessarily we had to create a new business and we did it in about eight days yeah i mean i'm looking at you going like i don't care what you do the rest your life if there's any opportunity for me to like give you money i want you to have my money because you've built a team and you executed literally launching essentially a new business overnight yeah yeah it was about eight days from concept to when we launched the first website and then we basically took pre-orders for two weeks to buy us extra time as we sourced small vendors from our first box which was seattle um and we sold in the first three months we did 500 000 in sales um with no marketing spent other than like amateur pr march april may are the first three months yeah uh we started we launched the website on march 19th so it was from march 19th to may 19th yeah and before we go back and just talk about again south by canceling and the financial impact that it had on you on 500k in sales on the new business model what's your margin on that obviously you have to pay for the actual products it's your cost of goods sold is probably way higher than the photo booths right way higher so our product margin gross product margin is about 40 net business margins maybe five because we're very new at this and i'm sure we're relatively inefficient in some ways whereas when we were running a photo booth company our product margins were 300 maybe more yeah so you'll make 25 grand on 500k topline sales 5 yeah give her give or take yeah honestly about that after everything's said and done okay so let's go back to february for a second just like let's act like we're taking a snapshot of the business um how much cash was in the bank uh about seven hundred thousand dollars and what was team size 18 people...