(static crackling) (mellow music)
- Hey, guys, I'm very excited.
This video is the first in a six-part series
that I'm gonna be releasing
over the next two and a half months or so.
I'm starting a new business,
and the idea is to do it for under $500
without leaving this apartment,
to show you the whole process from start to finish,
my successes and my failures,
with your real-time feedback helping decide
what happens next.
Oop.
So, what is it that I am doing?
(slurping) Ooh, too hot.
I am proud to announce that I am making my very own teas!
(jubilant music) I'm making tea!
I'm starting with two original blends,
one for energy, one for chilling out.
(woman snoring)
And my goal is to make the absolute best,
most (beeps) delicious teas
that the world has ever seen.
And so, the first step is,
how make tea company?
- My name is Jason D'Mello.
I'm a professor at Loyola Marymount University,
in the Fred Kiesner Center for Entrepreneurship.
- We're talking about starting businesses today.
I feel like I should've worn a blazer, too.
Am I underdressed?
- You're not.
I felt like, as a professor, I should look
a little professorial.
I'm wearing shorts underneath this.
- I'm not wearing any pants at all,
so you've got me beat.
The goal that I have is to get tea into people's hands
in two months without leaving my home,
and I'm trying to spend under $500 out of pocket.
Is that possible?
- Yeah, hell, yeah.
Most businesses don't need that much money to start.
I mean, you just have to be creative,
but what we try to get students and new entrepreneurs
to think about is not the business plan,
but the business model.
So how does this business work?
What is this story?
What's the narrative?
And I always start my classes with a diagram,
this Japanese concept called Ikigai,
are you familiar with this term?
- I don't think so, Ikigai.
- [Jason] It loosely translates to your purpose
or your reason for being, and it's the intersection
of your passion, your mission, your profession,
and your vocation, the things that you love,
the things that the world needs,
the things that you can get paid for,
the things that you're good at.
And that's the Holy Grail for entrepreneurship.
- Okay, thinking about my Ikigai.
So what I love is tea, (beeps) duh.
I love drinking tea, I love the way tea makes me feel,
I love finding new flavors and just like,
trying to find the best tea, (beeps) tea, check.
What I'm good at is debatably, this, at making videos,
hopefully connecting with people, making content
that shows people why this is a great thing
that they need in their lives.
What the world needs, again, I think tea,
it can help you slow down, it can give you energy
and clarity, but beyond that,
I think we need tea to be cool.
We're a coffee society.
People turn to coffee as their caffeine of choice,
and I wanna show people that tea's better
in every single way, and it's (beeps) cool.
And finally, what I can get paid for,
making the greatest tea that the world has ever seen.
(whooshing) (imitating explosion)
Ikigai. (upbeat rock music)
- You have a good Ikigai, yeah,
you've got a clear understanding of why you're doing this,
so your passion for tea is a great place to start,
and then, look at what the world needs.
It's gonna be a $86 billion industry in 2026.
- I'm sorry, did you say $26 billion industry?
- $86 billion.
Right now-- - Oh. (laughs)
Oh, I was short 60 billion.
I don't wanna just sell someone else's tea.
I wanna create a brand-new tea, a tea better
than anything else on the market,
so I'm gonna need a partner.
I also maybe should put some pants on.
- My name is Steve Schwartz.
I'm the founder of Art of Tea,
and I am a passionate servant of the leaf.
- Wow. (laughs)
- I had no idea that I was gonna start a tea company.
I just knew that I was a huge tea nerd.
When I finished studying, I worked four different jobs,
I got a backpack, and started traveling around the world
to find the best teas and botanicals possible,
and started bringing stuff back to friends
and family, and caught the attention of Wolfgang Puck,
Caesar's Palace, Google.
I'm super passionate about blending.
So I'm honored to be here tracking with you today.
- Please, the honor is all mine.
I, if you're a servant of the leaf,
I'm a peasant of the leaf. (Steve laughs)
Over the next few weeks, I get to make original blends
with Art of Tea, and with your guys' help,
and I'm stoked that they said yes,
because one, they're literally better
and more creative at this
than anyone else in the world, but also,
they source from better products
than anyone else on the planet.
- So imagine getting, for example, a bag of chips.
At the top of the bag, you get these uniform shapes,
and as you work your way down to the bottom,
it's a bit more broken, and all the way down at the bottom,
it's just powder or dust.
- Uh-huh. - So what we source
is the top 2% of all the teas
that are produced in the world,
hand-harvested, hand-picked.
That's the top of the bag.
- Oh, so you're getting the good chips,
not like that stuff that you have lick off your fingers
and dip the bag into your mouth.
- Yes, yeah, so that stuff is when they're producing
the teas in the factories, the dust falls on the ground,
they sweep into giant piles,
and that's preserved for most traditional, paper teabags
that you find at a typical supermarket.
- Wait, literally, they sweep it off the ground?
- Yeah, yeah. (broom swooshing)
(buzzer resounding)
(woman slurping)
- We've all had shitty tea in our past,
and I think, for a lot of people,
that turns them off of it forever.
How do you go about blending flavors,
and making a brand-new tea?
- I'd say years of (beeps) up.
- I've been doing that forever.
- [Steve] (laughs) That's awesome.
- That means I'm super prepared for this.
One of my goals with this project
is to take artisan-quality tea,
but demystify it and make it easy and accessible and fun.
But I'm doing this for a lot more
than just to make something that tastes good.
I do want a sip, though, hold on.
(smooth jazzy music) (slurping tea)
Mm. Over the years, through our videos,
you've seen the process of me becoming myself,
of, you know, I started out as this raw man putty,
and have formed into a person that I'm pretty damn proud of.
My autoimmune disease has stolen a lot of my life.
It has robbed me of energy, of creativity,
and at its worst, motivation.
Finding the right tea has been crucial in giving me
my life back and helping me fulfill my potential
these last few years, and now, I have the opportunity
to pay it forward to you, and to prevent you
from having to buy as many goddamn teas as me,
to find the best one.
- You know, if you see someone slipping in a mine,
you hand them a stick.
You don't hand them your hand.
They could pull you in, and you'd both have to figure out
how to get out, but if you hand them a stick,
they have a tool to be able to leverage themselves out,
and teas seem like that thing.
- So we're gonna give people a bunch of sticks.
- There you go, man, yeah.
- I'm starting out today with nothing.
If I were to make a to-do list, what do I need to check off?
First I need something to sell,
business plan, flavor, a flavor, I need a name,
need a logo, and aesthetic, packaging, margins,
loose-leaf tea versus bagged tea, I need to get samples.
Holy shit, this is a lot of stuff.
Sales portal, subscription service, marketing,
social presence, a launch data, need a website.
Hmm.
- So have you registered your business?
- No.
- Okay, so getting a DBA, doing business as gives you
sort of a tax ID, and that's the first step.
- So any good business needs a great name.
Stop being so sexy, Zach.
So I have a couple ideas, but first,
I just wanna try out, there's this business name generator,
let's just type in tea, and see what they got.
Neptune Tea, Treasure Tea, Tea Lightning,
Mogul Tea, Tea Matters.
Honestly, that's a great slogan right there.
BlackBelt Korndiddy.
I like the sound of that. (slurping)
(repetitive slicing)
- I call it a tea paradox, where people are like,
"I don't have time to make tea,
"I wanna push a button, I want the shot of espresso,
"I want my tea instant."
But if you take the time to select the leaves,
to prepare the water, to get your cup ready,
to slowly just sip, it's amazing how much more time
opens up throughout the rest of your day.
- Go drink some tea, and stare at a tree.
It's gonna change your goddamn life.
- It is, man, yeah.
- What I want for this tea to do is to give you energy
and clarity of mind, and motivation.
It doesn't matter how you start,
it doesn't matter how many times you fail.
It just matters that you keep trying.
Slow and steady, and you'll win the (beeps) race.
So for all of those reasons, I'm calling this Turtle Tea.
Turtle Tea.
There's a lot to be excited about, excited about,
excited about, excited about. (Western style violin music)
So I went to turtletea.com, no.
What?
No, no, no, no, no, no!
And it redirects to someone else's website, jimneuner.com.
No!
What do I do?
He doesn't make tea, and he's not a (beeps) turtle.
What is going on?
(sighing) You okay, phone?
So we did a little bit of sleuthing, and it turns out
that he has owned this site since 2008.
- There are people that bought it a year ago,
and are parking it, and are gonna forget it,
not someone who's been parking it and paying for it
for 12 (beeps) years. - Yeah.
- What do you think his (beeps) game is?
- [Lauren] Oh, we found his Instagram.
- He likes gnomes, eating hot dogs, and using Oxford commas.
Listen, Zach, this is a no.
- That's red flags. - Your not getting it
from Jim Neuner. - Yeah.
- So I decided to reach out to Jim.
I wrote him a very kind email, seeing
if I could purchase it from him,
"And I hope you're managing well amidst all this craziness.
"Best, Zach Kornfeld," and send.
No response.
- That's a very strange domain for Jim to own.
How many times have you reached out to him?
- Just once.
- Well, I would say, be a little bit more persistent
before you give up on the domain.
- Sent him another email.
(keys clacking) (panting)
Get the website.
No response.
Then, I went to go register my trademark,
using the Trademark Electronic Application System,
literally the abbreviation is T.E.A.S,
and it turns out that Herbal Turtle Tea is taken.
Fuck!
This is crazy.
Beyond Turtle Tea, we have applied
for several trademarks now,
and they're all getting rejected.
Tea Paradox, there's a company called Paradox Coffee Co.
Spillz Tea, there's another one called Spilling the Tea.
Kettle Black, Black Kettle.
Zax, Z-A-X, which was like, not even one
that we really liked, but there's a registration
for Organic Zacks, Z-A-C-K-S,
and because it sounds the same,
I can't even use my own (beeps) name.
I had no idea this was gonna be so hard.
Do you know broadly, percentage-wise,
how many businesses succeed versus fail?
- Some people say like eight out of 10, six out 10.
- Succeed?
- Fail. - Oh.
- There's a Mike Tyson quote
that, "Everybody has a plan
"until they get punched in the face."
(punching) And it's true.
You go into a fight, and you have a strategy
of how you're gonna take an opponent,
and the moment you get hit in the face,
everything that you're training for is gone,
and that's what it's like in business.
- How has COVID-19 affected business?
- So about 80% of our business has been impacted.
What it's done, Zach, is that it's allowed us
to reflect back on why we exist as an organization.
What are our core values?
It's leaves and water, but it's so much more than that.
Our company and our team is very purpose-driven right now,
in the fact that we're here for a reason,
and we wanna impact as many lives as we can through tea.
- We're going on an adventure.
I kinda just need to get outta the house,
and clear my head, and just try and think.
- A lot of people fall in love
with their products as entrepreneurs.
I would urge you to fall in love with your customers,
and the product can change and evolve over time,
but if you love your customer, you will find ways
to create value. - [Zach] What are the things
that I need to be thinking about right now?
- Who are you, and who do you wanna become,
and what impact do you wanna make in this world
with this product?
Unfortunately, I have to go, but those--
- (laughs) I love how you're like, all right,
well, just unpackage 30 years of living,
find out who you are, and I gotta go, see you later.
(both laughing)
This moment, the first of probably several
inevitable failures during this process,
you know, I could react one of two ways.
I could panic and freak out. (yelling)
Or I can use it as a moment to reflect.
(gentle music)
What is my Ikigai?
Who do I want to be?
Turtle Tea was just this obvious name.
It felt easy, it felt right.
Now, I'm like, (beeps) that name.
It is not a good name.
I can do better.
In fact, I will do better.
I'm gonna come up with something that blows Turtle Tea
outta the (beeps) water.
Save the turtles.
I wanna make something that give you the energy
to manage your daily life, to stimulate your creativity,
to motivate you, to exercise, to get out there,
to be social, to soothe your stomach and your anxiety,
and to give you a clarity of mind,
to do all of this without the jitters of coffee.
I wanna make the best tea, nay, the best caffeine
that the world has ever seen, a tea that I wish
that I'd always had, that hits all of my specific needs
and I wanna share it with you, so that you can be
your best goddamn self, too.
And together, we'll change the world, probably.
(triumphant music)
Here, I thought I was starting a business.
I'm actually soul-searching, and finding out who I am.
- I hope so.
- I want you guys to be a part of this process.
Tell me what you think, tell me what you want,
blow up my Twitter mentions.
Hey, Bowie!
Let yourself be heard.
In the weeks to come, I still need to decide
the final flavors, the packaging, and we need a name.
There's a lot to do, but I am stoked
because we're doing it together.
You are a nuisance.
Next time on "The $500 New Business Challenge,"
all the good names are taken!
Time to try my tea!
(slurping) Oh, this is terrible!
What have I done?
We're running out of time and money!
(slurping) Oh, this one's delicious.
What have I done?
I'm stressed out.
(upbeat music)
I even looked up CockTeas as joke.
Taken.
(sighs) Of course it is, it's a great name.