Uncover the secrets of E-Commerce Growth in this episode of The Level Up Show. Join Neil Twa, CEO of Voltage Holdings, as he shares his journey from corporate life to building a multi-brand e-commerce empire. Neil dives deep into the strategies behind scaling brands, creating lasting value, and thriving in today’s competitive digital landscape. Packed with actionable insights and visionary tactics, this episode is a must-listen for ambitious entrepreneurs eager to elevate their success in the online marketplace. Perfect for those ready to achieve real growth and impact in e-commerce!
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Welcome to the show, where we have the absolute pleasure of learning from thought leaders in business, franchising, high performance, and personal development. Our guest certainly fits that bill, Neil Twa, CEO and co-founder of Voltage Holdings. Welcome to the show.
Thanks for having me here. I appreciate it.
Voltage Holdings, what is it? Specifically, how did you start it?
Voltage is an incubator. The holding company is multiple brands that we own and operate within our structure. We have twelve brands that we own, manage, and control. In that process, having gone through seventeen years of business building since I left my corporate job that fired me a long time ago. I learned to go the one direction and then pivot and go a different way, which is business at the end. It’s agility. In the market, it’s following the money when it moves. It’s finding niches and developing multiple streams of income within them.
E-commerce is something I landed on in around 2009 and 2010 when I was looking at direct marketing for my consulting company. When I built Voltage, it was to move away from what we had originally created in our own infrastructure, which was twelve employees and 21,000 square feet of warehouse and a whole infrastructure. We had physical products running on Amazon’s platform being delivered by Amazon and realized that there had to be an easier way to do this.
When we developed the concept of Voltage, it was to take and train high-level operators to become CEOs of companies and got away from the employees and moved into training business owners to become executives of e-commerce companies. As we trained them over the years, we’ve raised a number of businesses with these operators who now operate and grow these companies. They are now operating our companies, companies we acquire, and companies we’re building for our clients.
We’ve become a boutique consulting agency on the digital marketing side while being an actual operator and growing the businesses now exiting companies. We’ve grown companies. We’re helping our clients exit, and we’re also into acquisitions to buy companies that match our brand portfolio. Five of them by the end of 2025 is our goal right now. We’re a little bit of different things within our holding company of which the digital marketing component of Amazon and e-commerce is one vertical, along with a software vertical, as well as our own operations in multiple companies that we operate.
I got into it because I was going to become an aggregator. I was going to raise capital to continue to grow our acquisition portfolio, which it did. I raised a couple of home offices up to $50 million each. We were going to paper in around November of 2021. I realize the market segment. My partner came to me. He’s our CEO, CFO, and also my co-founder. He came to me and said, “I have to show you the data. This doesn’t look good.” I spent the last eighteen months going through this process of making connections and getting through all the rigmarole of raising capital, which is quite an extensive effort.
He realized that we couldn’t buy the companies. The market had elevated the cost by 40% above the actual market. If we were to acquire these companies, it just wouldn’t pan out in the next 24 months. No matter how good we operated the companies and how strong we could operate them, it just wasn’t going to pan out. Unfortunately, there were a lot of other companies that got involved in the aggregation space around Amazon who have found out very hard the things that we learned early as business developers, owners, and operators, they discovered that along the way.
Maybe they did it on purpose. Maybe they didn’t know any better. I’m not sure what, but a number of them have gone bankrupt, capitulated, and closed down shops. Even one is being investigated by the SEC and it turned into a major nightmare. I’m glad we didn’t get involved in that, but we have continued through the process of building, growing, exiting, and acquiring these companies as we were doing previously and now have a small private equity group, a more centric version of this called Patriot Growth Capital that we’re partnered with to go out. It’s a veteran-backed, veteran-owned, and veteran-operated business.
The operators for the companies that are going to be acquired will be trained by us into those companies and it’s the purpose-driven aspect of keeping veterans off the streets, giving them the opportunity, having a pathway out of the military for them and their families, and giving them the opportunity within five years to buy the company back from us. That’s a little bit different driven purpose and value, which is good. Am I answering your question or am I going too far down the line here?
I love it. I see entrepreneurship being expressed and I’m being inspired. I appreciate your sharing. What else would you like to share?
It didn’t come out without challenges. You invent and you innovate. There are a couple of different ways to look at business. Business for me is creative. It’s the right brain. I was a musician from the fourth grade until I went through college on a music scholarship and played classical jazz and trumpet, big band, and jazz. Creativity and fluidity of music have always been a part of my life. When it came to business and people were like, “You cannot do this,” I’m like, “Why not?” It doesn’t sound right to me.
“You have to go this way and do this thing.” I’m like, “Why cannot we do it this way?” I would always torque people off. “No, this is the way it has to be done.” I’m like, “It can be done a different way. Music is fluid, jazz is improvisation. Why cannot business have some improvisation to it? I know it exists, I see other people doing it. Yet I had people telling me it couldn’t be done.” I always bucked the idea that I had to go a certain way, a certain path, and a certain thing. The creativity aspect of that was where business shined for me.
I got locked a little bit into the corporate world until 2007, which was hard to get out of it through some motivation. A mentor who died earlier than I would have liked him to do it. An accident helped spawn my need and desire to finally get out of the corporate world, which I had been wanting to do for a while. I simply got into it because that’s where money was being spent. I jumped out of college and left early because, at the time the internet was coming online, it was academia or the professional world.
You had a choice to figure out how to work your way into what was happening because nobody else knew what was going on. There we opened the first computer lab in my college and put the computers in it. I know I’m dating myself. This was a big time, a big change. I had to drop out of college to figure out how to make some money in this space and go after it. I went down the corporate track for a while. That landed me an IBM and eventually left IBM in 2007 when I realized it was the right time to go.
That mentor’s dying was a catalyst for me to do something that he encouraged me to do and continually suggested I do something different and get out of that corporate world. It took me a couple of years after that to get things together. I did burn the boats, not the bridges. I burned the boats and left. I said I’m never going back. The pivoting components of that, there’s a lot of change that occurred in my life during that period, not everything was rosy. I got too heavily invested in a company that I thought was going to be an amazing opportunity and invention.
I was on the patent and I got some partners in that. We got into what turned out to be financial trouble that I wasn’t aware of. I discovered some of the things that shouldn’t have been happening in the company. I have become too heavily leveraged in, put too much money into it. A business bankruptcy strategy was my only outcome to indemnify myself and step away from it because it had nothing to do with the way the funds were being used. I had to reinvent myself and start over. I knew my skillset, I know eCommerce, I know business development, I know the online world, and so it’s like, “What do I want to do?”
I want to be in the eCommerce world. That’s where I want to stay. I want to be on the online side. Somebody told me I should be selling on Amazon. He said, “If you like the digital side and the marketing and direct response, and you’re pretty good at it, you should come check out the physical product world. You could be building brands and be doing this stuff.” I’m like, “I don’t know how to build a brand.” He showed me the ropes of that and showed me how I could use Amazon to become a traffic source of people coming in and buying products. How to use fulfilled by Amazon to ship the products and put them into their system. I didn’t have to touch the product.
That evolved into creating some great brands. When we diversify, like all people do at times, sometimes it works well and sometimes it doesn’t. One of those areas was to diversify into flipping more products faster in a more arbitrage methodology. Brand new products we were getting from third-party wholesalers, which led us to have a 20,000-square-foot warehouse and ended up with twelve employees doing about ten truck rolls a week. It sounded all good and fine. It turns out that it didn’t make us a whole lot of money, and we ran into a whole lot of problems.
It took us about two years to shut that all down. That was not the best way to work that process, but I learned how to grow that business. We turned it into an eight-figure revenue, but it was only a single-digit profit. We realized that was just a big job, not a lot of money, but a lot of effort. I was flying between here and Salt Lake City, where the warehouse was and that wasn’t friendly to my lifestyle either, because we live on 50 acres in the country and my wife and I homeschool our kids and we hang out and it’s a totally lifestyle-driven business that we have. That disrupted the flow and opportunity costs.
Long story short, I realized it wasn’t the way to do it, but I still needed the operations. I still needed the people. I’m more on the right side of the brain. My partner is on the left or is it left and right? Which one is creative? I get this backward sometimes. Maybe I’m a little dyslexic in the brain. I’m more creative. He’s more tactical. He’s more in logistics and operational finance. That’s why he’s a CFO. He loves the details and things and there’s a path through everything and operations, etc. Me on the other hand, I’m like, “Why not? Let’s just jump off the bridge and see what happens. We’ll build something on the way down.”
We complement each other in that way. We’re two heads make one. He’s very strong in that way. I was like, but we don’t want to get back into employees. How do we do this? Here’s where the concept idea was. If we train specific people, not in a course, not to sell courses, and just make money off of that nonsense, how do we get people and qualify people? Help them build something while gaining some value in themselves and their business and helping them create a business while we’re doing ours and then see if there’s any interest in their partnering with us as operators and trainers of the business that we trained up. That model has worked extremely well.
My coaches now are business builders that we taught and trained and who run their own companies, but also help coach and mentor our clients that we’re looking for. We have product partnerships that are run by operators who have been trained by us, embedded by us, and running companies already in e-commerce that they can help others learn how to do. The companies that we’re acquiring are going to raise up operators that were already trained within us as well. We’ve raised an ecosystem of people inside of our incubator to go and run these companies. I don’t have any employees. Long story short.
You shared that story, which was incredible, by the way. You mentioned it didn’t sound like it was always smooth sailing. There was a ground zero through bankruptcy. That led to you becoming super clear about where you could express your talents.
I had to pivot. No choice when you have $269 in the bank account and three kids. You’re like, “Now what do I do? I had to reset everything, pay off lawyers, pay off debt, pay off everything. It’s like, “There’s all the money gone.” Now I have to come back from that, no credit score. I have to do it in a bootstrapping way. That was a pretty good challenge. No doubt about it.
You ultimately settled into eCommerce in the online space.
I’d been in the digital side of it on the lead generation and affiliate marketing side for paid traffic and media, taking media ad buys and spending across to Facebook and paid traffic and digital marketing and mobile marketing. Arbitraging other people’s products for a dollar, $0.70, 5$, whatever the arbitrage would be. I was flipping digital products and got pretty good at it. I understood direct response marketing, creating a problem-reaction solution narrative, and being able to build traffic and mechanisms, and got pretty good at the media buying side of it.
I just didn’t connect the physical product side to it. People might look at it and say, “You added more complexity, but in actuality what I added was a product base.” It’s a tangible physical product base in which capital can be moved into that product base and it has evaluation to it. Whenever we buy or sell the company, there’s the company itself plus the inventory. Inventory can be written down at the end of the year. Inventory creates an opportunity to move capital out of fiat and into physical and tangible products.
With the tangible nature of those products, the value of the product and the brand increases greatly. In the same way, you buy a car, Nike shoes, or your iPhone. The transactional relationship with the customer changes dramatically than a digital product. It’s why our books get sold more on paperback than digital because the world still wants tangible things in their hands. As much as so many people push for the evolution of digital format in AI and all this technology, there’s a huge push back the other direction to be in person, have conversations, and with tangible goods to hold on to.
We’re still very much a tacit-based touchable society. It made sense to me to get into the physical product space. I could understand it a lot better. I understood the digital side of the component, but I couldn’t connect certain parts of the customer experience in my mind without a physical product. As I got into the physical products and realized that that’s a huge economy of it. It’s bartering and selling and buying products. It’s not new. It’s anything under the sun. It’s just eCommerce. The technology and the internet made it possible to do it in a one-to-million ratio, not a one-to-one or one-to-ten at a market share, or 1-to-1,000 or 10,000, depending upon the size of the local audience you had to sell at a retail store.
This is like one-to-millions, one-to-billions, if you go international. With that, my brain was like the possibilities of expanding are just huge. We got in and we started to flip some products and test them out. We test out the physical side of Amazon. Its engine is very familiar with engines of AI technology. I was working on it during the IBM days. It became very familiar to me at the way it was ranking and looking at data and the algorithms were showing products to people. I’m extremely familiar with that because we’ve worked on those systems at IBM.
On the physical side of it, my partner understood the logistics and operations. He figured out how to make sure we got that done right. Amazon helps a lot with that. Their Fulfillment by Amazon, the FBA side, we call it the done-for-you component of this. It’s automated. When you get your products in there, that system is handling products, last mile to the customer returns. It’s doing all that for us. It’s quite an engine. It’s a miracle that thing even works. It is fascinating now being that when they bought that logistics company and rebranded it as FBA, they were selling books and wanted to sell more physical products.
They bought a company, which is a logistics company. That has now turned into the sixth-largest logistics company in the world, planes, trains, automobiles, and everything. It’s a major juggernaut of product movement now. When we put products in there and automate that process, we then turn more into the direct response, marketer, branders, strategists, and marketing people who sell physical products that happen to be delivered by the Amazon system. I can do the same thing through another channel like TikTok shops because Amazon can deliver my products.
If I go and open a Shopify store and run paid traffic on YouTube and Facebook and other ads, those products get delivered by Amazon. It’s just a big logistics company. Once I set up that framework for my Amazon business side for a product and a brand, and we get inventory into Amazon’s warehouses, then I can take their warehouse and logistics system and turn it into a 3PL or a third-party logistics for any of the other channels we sell under. It creates more simplicity and doesn’t require more employees. I don’t need a warehouse.
I have multiple operators with multiple businesses being run through blinky lights, dashboards, and logistics without ever touching the product or being in a warehouse. That flexibility gives us the opportunity for growth and scale at numbers that are incredible. Most people cannot understand the scope of the internet and how large it is and the fact that only, what was I seeing the other day? Something like 7% of the invisible internet we use or we’ll use throughout our life. The rest of it’s on the dark web.
There’s so much information and movement and digital movement of products and information that people cannot quite comprehend the size of it as much as they can comprehend what a million dollar looks like or a billion dollars or a trillion dollars. These things roll off the language now so fast through media, social media, the news, etc., and people cannot comprehend quite how much that is any more than they can comprehend how Amazon moves 8,600 products a minute through their systems.
At 8,600 products a minute, that is a lot of infrastructure. That means there’s a lot of buyers, there’s a lot of demand. I learned to take our products to Amazon first and capture that demand. It’s already there. It’s like going to a marketplace where everybody wants to buy. That’s why they’re there. I put my product and my wearers out and I set them on the table and I say, “Which one of these do you like to buy?” The ones that sell the most get the most money and the most marketing. The process we developed called the green light process determines the profitability of the product. We know which ones sell.
After having launched and failed and succeeded at enough products over enough time between ourselves and our clients, more than a thousand launches in the last ten years, we see the data now. We see what works, we see what’s on the market, we see which trending, and we understand the data points for profitability and the major metrics to pay attention to. It becomes a repeatable process. It’s time for the market and the ability to overtake competition and perseverance and tenacity and not fail out on the market. Now we deal with things that are very different than I could have possibly imagined moving at speeds I sometimes cannot comprehend myself.
You mentioned the opportunity of just the size and scale of the internet for eCommerce.
It’s changed so much.
It’s massive and I love how you mentioned 7%, which we will use in our lifetime. As you were talking I was thinking about the importance of AI synthesizing that 93% and how much it’ll be critical for us to leverage AI to take advantage of all of the opportunity and information. There’s so much and the world’s ever-changing technology. I thought a lot about virtual bartering and our kids in that generation are going to be taken to that way of experiencing the marketplace and tangible assets will be digital.
Digital currency is one example. We’ve gone from fiat currency and tangible dollars in our pockets to the possibilities of completely digital currencies, which have their positives and negatives. It’s all about who controls what, what access we have to it, and who has access to us through it which comes down to the values of freedom, where you value freedom in your life, and what you’re willing to give up for certain gains, etc.
Personally, seeing the effect of this in the business and the market, AI for me is the tip of the iceberg, just the tip of the iceberg right now. I’ve seen what it’s capable of doing on super machines at IBM and the Cray machines and Deep Blues and stuff. I know that they had quantum computing and stuff decades ago. The effect of AGI and Ascentiate Computing and Technology is probably already available. They just haven’t rolled it to the internet. Right now we’re just being adopted and conscripted into what AI will become through systems that we can play around with and barely comprehend.
If you go out and just average, it’s so wide open. It’s so still new that for some people who are maybe tuning in to this, they think, “I’ve heard about that. I understand it. I’ve got my con in place.” If you go out to ask the average Joe on the street and just walk down through the middle of the city and ask people what’s Bitcoin, most of them aren’t even going to know. They don’t know it yet. They don’t understand it. It’s new.
Those who understand what the technologies can do and how to apply them to their business or how to utilize them as a business are the ones who are going to win. I don’t know that AI is going to be something that replaces us for quite a long time, but I do know that it is something that’s going to replace people in their ability to use it to create enhancements and competition in the marketplace. We’ve used it to time-compress activities that would take days or weeks down to days and hours. We’ve been able to compress time and information.
We’ve been able to take large copious amounts of data and compile those LLM information down and use them for marketing and advertising and management of PPC systems and stuff where the systems are now competing system to system. If you’re trying to compete with them as a human, you’re going to lose because you cannot compete at that level of size if you don’t understand how the other game is being played. It’s going to be an unfair advantage or a disadvantage if you don’t figure it out. We’ve used it for images and graphics and making our listings and the media and even the voices are digital and the images and graphics are digital.
The idea of complex deepfakes and other things is becoming a reality from cloning voices to deepfakes and faces and stuff. There are some real questions of ethics and morals that have to be countered in some of this stuff or become dangerous to society. As an opportunity, it has a lot of ability to move and compress time, as well as be efficient in the things that we’re doing. In our business, we’ve used it in a number of places to make it easier and faster to do what we do.
Even our systems we developed internally that we have for our own company, go out and automatically research Amazon for us, pulling in data and information and products and presenting it to us so we can go look at it and say, “Is this the next product in our pipeline?” We have automated research assistants. We have GPTs inside of our coaching that are for different areas of the business that we can communicate with and our clients can communicate with it. We constantly update, grab, and scrape information, compose it, and then represent it to get back through those GTPs specific to our products, processes, playbook, and methodology that our clients can use to simply ask questions.
We’re working on one right now that we hope to have out not too long, but it’ll be a virtual coach inside of our organization. They will have the last ten-plus years of information, transcripts, and videos all fed to it. It is going to become what we were laughing at their day. What do we call this thing? We haven’t got a name for it yet. One of ours is called Howie. We’re like, “What else do we call this one? Bob or something? I don’t know. We’ll figure out a name.”
You can ask it a question and it will be able to tell you based on the video transcript and information from the last 10 years and the last 10 months or 10 minutes or the last video that was uploaded from last week’s coaching session what’s the best methodology for optimizing PPC over a seven-day period? It will both pull out that information and the video and the specific format and say, “Here, this is the answer to your question.”
It has the ability to build these information sources and leverage these as tools and coaches and training tools to build better operators and faster operators and turn our systems and efficiencies up. Right now, we’ve got 7, 8 client businesses at nine figures. You can run those with a handful of people now, which is something that’s quite insane. It used to take decades to see a company reach eight figures. We can get to eight figures in four years or less. It’s quite a world.
When you mentioned customers. Do you have multiple customers? Can you clarify who your customers are?
In Voltage, our customers are individuals or businesses who want to operate, grow, scale, build, exit, or even acquire in the Amazon space or eCommerce multichannel space. It could be TikTok shops, Shopify, wholesale, or anything around the economics of an e-commerce brand that moves a physical private label product. Those are our clients. The customers would be anybody who purchases a product from us from one of those vehicles, one of those channels. Those customers are in the millions.
When you look at your partners, fellow business owners within your holdings company, do you look at them as customers or they’re more so as partners?
We have both a client and a partner. I have clients who are working with us under twelve-month engagements to build and grow new brands and learn and train to become a CEO operator. I have existing brands that come in and say, “We’ve tried or we want to get on Amazon or we’re on Amazon as an FBA channel and we haven’t been able to grasp hold of it, monetize it, trade it time for money too much. Our teams haven’t been able to make this work. Can you guys help consult with us? Can you help us do this?”
We have a product partnership program with our clients who are raising up their own companies if they decide to partner with us after some time together. Learning those ropes and getting into a trust, we have voltage product partners, which allows them to work directly with us in an owner equity position, which they do become true partners down to the sale agreement, down to the operating agreement. At which point we take a percentage and they take a percentage of ownership and we bring up a new brand, but we control the growth, the pipeline, and everything.
For them, it becomes almost automated income because their job is they help with the financing and the oversight. They help learn the operations and controls, but Voltage manages and controls the whole operation for them. It is specifically on private-label brands. It is not something I take anybody into who is not already trained as a CEO operator. They must have been trained and understand the mechanisms by which we run the company and the policies and procedures that we run within the business, so they can understand how we do it.
If someone just comes indirectly and is like, “Here’s my money. I want a partner and I want my side hustle cash. I want my mailbox money.” I’m probably going to say no unless they are a direct referral from somebody already doing it, who’s understood and expected how to do it. There are a lot of gotchas in this world out here with these types of businesses who think that Voltage does online, Amazon automation, wholesaling, retail arbitrage, shop your way to wealth, and all that nonsense. We don’t.
We’re pure branded DTC and FBA multi-channel play. We don’t play in dropshipping products. We don’t play with the wholesale nonsense and retail arbitrage, We don’t do Amazon automation stores. These are branded private-label companies. The goal is to get them to an excitable state in 3 and 5 years so we can acquire them. As we build up each one, we’re looking to acquire that within the company. If we own a portion of it and the time comes to sell, we may own 100% of it after we buy out the partner later on.
How do you determine which entities you’ll create?
The business, it doesn’t matter what we call it. The holding company owns one percentage of it and will form an LLC, the being named in what’s called a disregarded entity. That entity will become a saleable entity on Amazon and we’ll develop a brand. No one’s ever heard of it. The brand takes ten minutes to develop a brand. No one’s ever heard of it because we’re going to leverage Amazon until the point where it becomes a household brand name. We have certain methodologies, the way we choose them, and what names and languages we’re looking for. We simply follow that process to create that brand.
Then it’s more determining who’s the customer target avatar we’re after. The products are typically 50 to 250 in retail price point. We have a team that’s already in there. We have our system that’s already in there developing and moving products. If it is on a partnership side, we simply pick one of those out of our already running product vetting pipeline and we give it to our product partnership company instead. Otherwise, it’s in our internal product pipeline to be launched within our company. We simply pull one out and give it to them instead.
How do you determine which widget, which product service between $50 and you said $200?
$50 to $250 in retail or more. It depends. Some of our products are in the $400 or $500 range too. The goal gets down to profitability at the end of the day. Profitability of the product, minimum $12 in net profit per unit, preferably $40, $50 to $60 in net profit per unit. It was a good spot. We want the ability to acquire that customer. We need the ability to acquire them. That comes out of the capitalization of each unit and the ability to acquire one customer and a return on that advertising spend.
We know that if we can beat the competition, we might have $24 in profit and we have $48. We’re going to take the extra $30 and spend it on acquiring the customer away from them. As a brand, then we’re going to look at the second and third products and in amount of products in our brand that we can sell them after we’ve acquired them. Many people are thinking of first customer acquisition. I only want to get this for sale. They still think that even if they’ve heard me say this, they aren’t applying it in their business as a brand.
They’re not thinking about how that customer will buy a 2nd, 3rd, and 4th product from them. They aren’t willing to pay for certain levels of acquisition of that customer upfront that we’re willing to pay. If we know we can acquire a customer for at least 1 to 2 times the profit, and we know our pipeline numbers on that product have secondary products behind it, gear, accessories, or brandable related, or even buying two of them, knowing that that number’s work, we will acquire that customer upfront for whatever it costs to do it.
That’s what most people don’t understand. Now there’s a reason we do that on Amazon too is because Amazon’s one of the only locations, I believe besides Etsy, where you can rank your products in their search engine by paying for it with PPC traffic inside of their system. If I get what’s called my TACoS, total advertising cost to sale dialed in like 8% to 15% on those $50 to $250 or higher retail price points, then I know I’ve got an organic ranking coming up over here, which is full price sales.
I know I’ve got to pay X amount over here, the A cost, advertising cost of sale for that customer. What I want to combine together is my TACoS. My TACoS are within say 25% when I launch, but I know that over time it’s going to come down to 20% and then 19% and down to 15%. I’m going to dial that in. That’s where my growth takes off. There’s a line in there that comes along with that brand to determine how fast of growth and we can scale it between organic and PPC. The goal here is to maximize the amount of organic.
We shoot for trying to get 60% to 80% of the product organically sold and 20% to 30% on the marketing side which ensures profitability and growth has an opportunity to go up. Those products are identified in the data. The answer you may be looking for is, “I go out and I look for a specific product, but what I’m looking for is first, can I sell the dang thing?” Sales fixes everything. We look at all the data first. Competition data, the profitability of that data. Can I sell a unit of it profitably in the marketplace? I know somebody is already selling it.
The question is, can I sell that product? Is there anything that will stop me, Amazon, Acts of God, or otherwise, that will stop me from selling a unit of that product in the marketplace, even if it’s exactly like another product in the marketplace right now? I know the product is good, and I know that it won’t get a negative review, I’m expecting a great transaction because that’s what that product is supposed to do, complete the transaction two days after it’s bought. When you buy a product, you have to wait sometimes up to seven days to get the product.
You didn’t actually buy the product. What you bought was the outcome. The product is simply making the transaction ethical and closing in your mind that the transaction occurred properly. That the business was done correctly. The question you will have is, did it break? Is it what I wanted? Do I need to return it? Am I happy with this product? Am I so happy with it? I’m leaving a review. That’s when the product kicks in and it’s important to have a great product. Make no mistake but the first thing is can I sell the thing?
When people think too much about the product, they will typically take too long, and get into paralysis analysis on the product, thinking that they have to go do a shark tank-style product maneuver which is way too far into the invention stage and never get into the innovation of the product. If I get that product out there and I validate that that product will sell 100 units under my account, at my price point, my brand at this time in the market. I know with confidence if all those numbers work and it all green lights through that market test phase, I will go to a full 1,000-unit product launch.
At that point, I know how to put good money and good data into a good product and I will then innovate that product at that moment. In the next 1,000, I’ll make slight changes, maybe 2 to 3 changes to the product to innovate away from the one that I was originally selling in the marketplace, which will simply be answering additional questions in the customer’s mind to fulfill that transaction even more strongly, which will give me the opportunity to optimize the front end marketing over here a little bit more by adding some more benefits into the language of the copy and the images. Tweak it a little bit because I already know it works.
See how fast can I turn over that 1,000 units, hopefully in 90 days. Once I do that, I now know I have a product that will have a twelve-month run rate and it’s just one product, one line. The question then is, how do you grow it? I’m going to go find ten more of those. Ten more of them to widen the brand out the same way that you have an iPhone most likely. If you do, you have the iWatch, and then you got the iPad, and you got the iMac, and then you buy one for your wife and your kids and your family and whatever, and you’re suddenly giving a significant other. Now you have all these products out here in this space.
We simply borrow that same thing from retail and the eCommerce world. We’ll get our products and businesses dialed in on one account with one brand line moving 12, 20 SKUs all in that one niche vertical. It’s hyper-relevant. When done correctly in the system and something like Amazon, in 3 or 4 years, you can be running $15 million to $20 million a year in sales.
That’s across how many SKUs?
Our initial base of SKUs we test in a brand is what’s called our 5 by 5 product launch playbook. That means we need 5 products in there running an average organic sales of 5 units per product per day. That’s 25 units minimum, $300 a day in profit. Roughly if we’re at the net 12, more than that, of course, if you’re at 24 or 36 or whatever in your profit. The goal here is to prove that multiple SKUs in the market can sell.
I can replicate those scales into 10 or 20 other skews that complete and widen out the brand expectation of anybody who touched that original product. To give you a visual, that original product could be a bike, hypothetically, I don’t sell bikes. From that bike, it could then be, I sold the headlight, I sold the special seat, I now sold the panniers, I sold the calipers, I sold the disc brakes, I sold the water bottle.
You could end up having somebody spend $2,000 or more, $3,000, or $4,000 on higher-end product bases after consuming the first one from us. That brand widens out 5 by 5 into the brand base to create a holistic portfolio of somebody’s connectivity to that brand. If I’m going to go buy X bike, I’m going to buy all the gear from X brand too. In the same way, you’re going to trust the brand and trust any gear and accessories they sell as well. We follow that same tactic, that same strategy that’s been in retail for decades and we apply it to eCommerce.
It sounds like 15 to 20 SKUs.
The 5 by 5 is to get the first 5, but each of those 5 has the capability of running out say 50 different variations along each one of those. The real question is I want to get to the amount of SKUs that are making up 80% of all of my profits. What I don’t want is a whole bunch of SKUs that are barely selling and a few that are selling well. That’s not an optimized account. An optimized account is the majority of the SKUs in the account are selling well.
By my definition, what’s well? It’s how many I can move off that profitably every month while maintaining that good TACoS score and seeing it grow quarter by quarter, year by year. Giving it time and market to grow and move faster. It’s getting down to how many SKUs are and how much money you want to make in the marketplace. The more SKUs you launch, the more money you’re going to make. Some of them are not going to hit, and some of them are not going to be there forever. Every product has a life cycle. It comes down to the brand.
That’s why there are 10 and 20 different brands of pizza and burgers and other kinds of brands out there that constantly move different types of products. Each product has a particular life cycle. Look at Coke Zero or New Coke. Those came in and went out fast and there’s Old Coke just as an example. Our products and brands do the same thing. There’ll be some that live some 24 or 36 months, some go on to live 3 to 5 years. Some may be out there for a year or sixteen months and it’s like then they come back down again. They didn’t have a huge life cycle, which is fine because we’re going to constantly keep moving new products in the marketplace.
That 5 by 5 model, if I’m running it within one of these brands, what’s the average amount of SKUs per brand?
Here’s the thing. More sellers on Amazon have less than five SKUs than those that have more. With Amazon’s own branded mission, the more products you put in the system, the more relevant your seller account is. The pro tip is to have more than five SKUs because that’s like 70% of Amazon sellers have less than five actual branded private label SKUs in their accounts. We know this as a metric by which more maturity and account maturity and brand-ability and Amazon’s brand team has backed this up and said, “The more products you put into your brand the more we’re going to send you out the more relevant you’re going to be and the more traffic you’re going to get.”
It’s an average of five, but it could be up to 12 to 20, depending on how many gear accessories and variations you have of that particular brand set. Pretty soon you’re going to reach a point where you’re like, I’ve tried enough of the other variations that didn’t sell very well. Here’s the core base of this. Now my opportunity is to go and launch into new channels. My opportunity is to go to TikTok shops and grab demand creation, get influencers and videos out there, and get the audience and creation going because 30% of them are going to fall back to Amazon.
Now with the new initiative between Amazon and TikTok, connecting the platforms together, so very shortly, you’re going to be able to buy Amazon products directly inside of TikTok. This is going to be a game changer for Amazon sellers who are paying attention because we’re now going to be able to leverage the virility and live demand creation that’s huge. We set some records this year with the largest live streams ever on TikTok shops.
One guy did 5 million in three hours, which is insane. It’s QVC level types of stuff happening now through that platform, giving you the ability to then increase ranking, of course, on Amazon, increase your ability to drive more revenue, and that increases the multiples and valuation of the company increases as well. For every channel you open, it gains at least 5% new revenue on that additional channel. You could add 1 to 2 basis points to the bottom line at the time of exit.
I appreciate you sharing that. I have said it multiple times, but I certainly have been inspired by your story and understanding of the marketplace, your industry, and building a big vision and a lot of support and infrastructure for creating enterprise value and doing it efficiently in that four-year ramp period to an eight-figure organization and having some ownership and knowing that you’ve been certified and trained. It is inspiring to see the organization that you’ve built. I love what you’re doing with the military aspect and veterans and providing a solid opportunity to provide value in the marketplace.
That’s what it’s all about. That’s what we’ve been talking about and doing it in the eCommerce space and doing it on the back or I should say in partnership with an incredible organization like Amazon. You know that those orders are going to be fulfilled. The sophistication is incredible. I love the approach and perspective and the wisdom that you provide to your organization. Clearly, you have lived it and been dedicated to your American dream. Having your acreage with your family, creating a lifestyle business. If you were to provide a 30-second elevator pitch, what would you say?
I would say if anybody’s serious about eCommerce, understand that it’s a 3 to 5-year endeavor if you truly want to make it a life-changing opportunity. The E-Myth motto of do anything, do what others will not do for 3 to 5 years so you can live like no one else. We extol that in the way we do business. If you’re looking for a side hustle or a hobby business, don’t get involved in eCommerce in this way. Private label brand building has an intrinsic upside value to it, an excitable or saleable asset.
Whatever you’re building has a legacy and well-generational capabilities when done correctly. Things to get families involved, bring your kids in, bring your older children, and bring your wife or significant other to the table. We’ve got mostly family-driven individuals running these companies because they’re building with that end in mind. They’re building with the exit. These businesses are worth way more at the exit than at any time during the business-building phase. If you think about it as a business-building endeavor, a truly life-changing opportunity to build a lifestyle and something you could do in 3 to 5 years took me 17 years, and I can help you do it in 3 to 5.
If that’s of interest to you, then understand this is a capital and testing capital-intensive relationship too. These typically will take 50,000 to 100,000 to build out in year one, so growth in year two and scale in years three and four is a real possibility. If you put that down into terms of real estate or other types of investments, it’s on par with similar types of investment strategies in other ways, if you think about it.
The cash-on-cash value, the ability to return a one to a million capabilities of delivering 10,000 units to individuals every year and being able to do it with almost automated income, do it in locations, do it from a laptop, do it without ever touching the physical products, and leveraging these infrastructures to do it. If that sounds of any interest to you, then check out what we’re doing. It is an application-only process. You will talk to me and if it’s not a good fit, we won’t work together, but if we get in the boat, I want to make sure we’re rowing in the same direction together. It’s very important because there’s a lot of upside potential for these operators.
That’s certainly inspiring. How many folks have joined currently?
Not a lot. Since 2019 when we started offering this, about 275. We have kept it pretty small. As I mentioned, this is not a course in a program. I’d look for 3 to 5 individuals a month or so who I think might qualify to come into the process and work with us for a year because it is very one-on-one and directly done-with-you consultation and live coaching every week.
Together, weekly calls for twelve months, so I don’t bring a whole lot of people into that. I’m specifically looking for a profile of a person, a little bit of a unicorn in the way that they think and develop and can be trained and aptitude trained into that. Even if they’ve been in the corporate world for twenty years, it’s a specific aptitude that I’m looking for. They come through and we have that conversation and we find out whether or not it’s a good fit for their next move.
What a great opportunity. You said 250-plus operators, correct?
Correct. Over the last five years now, since 2019, I’m going to do math in my head, things are moving extremely fast. This year has gone so fast. I have at least 80 active businesses right now. In our current customer base, those are people doing anywhere from startup to mid-5 to 6 figures, all the way up to 9 figures who are all part of a community that continues to meet every week. The masterminds in growth and opportunities and multi-channel eCommerce. We meet for a couple of hours every week.
If somebody is interested in learning more, how can they do that?
They can go to VoltageDM.com and check out a free presentation with myself and Kevin Harrington. He was a co-author of the foreword of this book and a good friend of mine. You can learn about our As Seen on TV strategy for developing and capturing those brands. There’s information in the book that you should check out. There are free materials, free training, and anything around this that makes you learn a little more, invest in what you know, or invest in the knowing. That’s the opportunity everybody has. Check me out online. It’s a short last name. If you type Neil Twa, you’ll find me. I’m all across the internet. It’s LinkedIn anywhere else. Feel free to connect with me.
Neil, it’s certainly been a pleasure. You heard it directly from Neil Twa, the founder and CEO of Vintage Holdings. What a wonderful opportunity. Reach out for more information. Smash the subscribe button and drop a comment down below. As always, thanks for leveling up. Take care.
Neil Twa, CEO and co-founder of Voltage Digital, is a leader in e-commerce brand development and Amazon FBA strategy. With over a decade of experience, Neil specializes in helping entrepreneurs build nearly automated income streams through Amazon, leveraging his signature “5:5 Game Plan” and a unique “pay-as-you-profit” consulting model. Through Voltage, Neil supports aspiring business owners in achieving scalable growth, profitability, and long-term success, often transforming new brands into million-dollar enterprises.