What it takes to get a small biz off the ground with some buzz, with Habit Founder Tai Adaya

Joining me on the show today is Tai Adaya, Founder of Habit Skin.

The company that’s telling you the anti-aging truth around sunscreen. Habit is solving the annoying problems we have with sunscreen by innovating with SPF formulas and changing consumer behaviour.

Launched during the pandemic, Tai shares exactly what it takes to get a small business off the ground, how long it took to develop her products and find the right manufacturer, a winning strategy that generated thousands of people signing up to her email database and a few bits and pieces about the skincare industry you might not know about.

Please note, this transcript has been copy pasted without the lovely touch of a human editor. Please expect some typos!

Yes, my name is Tai Adaya, I'm the founder of Habit, Habit is reimagining the sun care categories. So we're developing sunscreens um and really innovating on form factor, texture and scent. And the brand is really creating a new narrative around sun care as a category. We're bringing out the health aspects and the anti aging aspects of sunscreen and really building a narrative around those aspects that are brand, It's amazing and it's so important and something that like I feel like I've like gone the last 10 years without focusing on that and now I'm like Oh my God, sunscreen, I need to wear this every single day.

00:05:42Edit What have I been doing with my life. It's so, so important and especially if you're going to be someone when you're older that's going to care about the signs of aging. It's very, very important to start young and that's really where I saw the white space and the opportunity to build a brand around that. Yeah, So true, So true. I feel like they're on any cool options that are like to go to, you know, even for things like smell and texture like it all seems really same. Same. Yes. Yes especially in the US we have like Coppertone and banana boat and it's like very like outdoor beach focus products that um we're not like the nice go to products that you want to reach for on a daily basis totally, totally. Well I want to go back to the beginning. I know you've recently launched but I want to talk about your life before habit, what you were doing and what inspired you to get into some sun something and sounds green. Yes. Yeah so um I have had a long career mainly working at e.

00:06:45Edit Commerce startups and so I've had a lot of experience working um with consumer products specifically. Um I did a little bit of health care so I worked at Good Rx which is a health care startup based in L. A. Um startup based on prescription drugs and price transparency. I worked at Casper, the mattress startup and so a deep dive into just like how do you sell a consumer product online? Um And then I worked at a color cosmetics brand called el massaged. Um It's an Israeli brand, I did the U. S. Brand launch with a big focus on E. Commerce and I have had a ton of experience selling things online and I I always wanted to do something on my own. My dad is an entrepreneur and I kind of grew up seeing that um And so I always knew I wanted to do it eventually, and I wanted to basically take the things that I had been drawn to before, and the things that I loved and combine them into habit, and so I, uh I feel like some care really does sit at the edge of beauty and health and I love that it has both of those aspects, and so I know I was just drawn to the category and I really felt that there was an opportunity to create something new and develop something that people would love and really kind of just approach it from a different perspective, totally, totally was there like a light bulb moment where you're like, this is definitely it, or was it more like, you know, different events culminating and like coming together and yeah, so it's kind of been like this thing, so like the true true story is my two best friends from college, when we were like 1920 we started talking about Botox, and so we, You know, even as 19 year olds, we knew that when we started to get older, we were really going to care about are appearances and so, we you know.

00:08:42Edit I think Botox was not as talked about widely then, but we talked about it and we were like, okay, let's, you know, start getting Botox when we're 25 we like made a pact that we would all start 25 as 19 year olds, um And so I didn't start at 25, but I started at 27 and I ended up broke the pact, but I ended up spending in the first year over $1000 on preventative Botox and basically just like the little area like on the top of my forehead to prevent the vertical lines. And so uh yeah, it was a lot of money to spend at 27. And I started to go on this journey to really figure out what works in terms of anti aging and being able to prevent those signs. And I started to interview a bunch of dermatologists and I started to read a lot of papers on the NIH the National Health Institutes database, They have a lot of really good free papers that you can read on there.

00:09:43Edit And I just started to like see the research and it was one study that I saw that showed the efficacy of laser versus Botox versus using sunscreen preventatively and like far and away using sunscreen preventatively is the best way to prevent skin aging. And that for me was the moment, I think I knew that like no one was really talking about it in that way and I was like, okay, there's a big opportunity here, wow, that's so crazy. I definitely didn't know that. And I feel like, you know, in those last few years where I've really started to care about my skin care and care about my routine and stuff. Those are the kinds of things that I'm thinking about. I'm like, well what do I do? What is more preventative skincare? And you think that you have to go out and spend so much money and you need an expert and you need this And that one actually the solution is really simple. It's put on sunscreen every day. Yeah, I think it's a bit of a generational thing. So I'm 30 right now and that was my concept of anti aging.

00:10:44Edit I think throughout my twenties it was like you have to go towards the expensive, invasive thing. But a big inspiration for me was I'm very preventative when it comes to nutrition. I'm very preventative when it comes to working out and fitness. And I realized that I was not being really truly preventative when it came to my skin care, I was going to things that are more geared at fixing problems rather than preventing them. And so I think that happens to a lot of women that are millennial gen z like they've just been so exposed to Botox and fillers and that is their concept of anti aging. Yeah, it's so crazy. I've really, it's really interesting because I've never really thought of it as as that is taking that approach. Yeah, really cool. What does one do to start a skincare sunscreen brand? How do you begin? Yes, there is a little different. This also is what drew me to the category in the US. It is considered an over the counter drug. So it's not purely a cosmetic.

00:11:47Edit I think a lot of people actually see the category and think that that adds unnecessary complexity. Get afraid I was drawn to that. I loved that there was that aspect of regulation. And unlike cosmetics the claims that you make against the sun care product have to be real because the US FDA has purview into that and I actually regulate the market. And so the hardest part about starting habit was finding a god um lab and manufacturing partner that would be able to help me create my products. And so that was the hardest part because I was literally cold calling and cold emailing manufacturers and no one really wants to work with a small player. And so I spent a lot of time just searching them searching for manufacturers and like on google or something. Yeah on google using databases. So um for over the counter drugs since they are federally regulated there is actually like a lot of good resources.

00:12:47Edit And so I basically did a bunch of backwards tracing through some of the and I. H. Databases. Uh we found a manufacturer um but yeah like I did a lot of backwards searching and um specifically like to make sunscreen you have to work with a manufacturer that's otc compliant. And so that's a special license that they get from the FDA to be able to produce over the counter products. And so I used the fact that they have to register those licenses to do some of those backwards tracing and I talked to a bunch of them and you know, I was just a lone person basically, you know, trying to contact these manufacturers and I eventually found one that was willing to take the risk with me and that was for sure the hardest part. And then um from there we developed and started developing, what kind of questions did they ask? Like what did they want to see from you to be able to take you on? And like was it a commitment financially or was it a commitment in terms of just, you know, passion or yeah, so I presented to them my view of how it was going to approach the market and I would say that they specifically have worked in the past few years with a couple of brands that have taken off and so as a manufacturer, they, they like to bring in a couple of new brands a year.

00:14:07Edit And so that was an attitude that I appreciate that they had. Um and yeah, I basically was like, I'm trying to work in sun care, but I'm going to talk about anti aging and I don't think anyone is really talking about anti aging. And so they were drawn to that perspective of it. But yeah, they were kind of like my first pitch um, to the manufacturing. It was really kind of like how are we going to tell the narrative around this category, how are we going to approach product development in a new way? And yeah they like I think they have it institutionalized that they do take a couple a couple of bets. I'm probably not going to be profitable for them for a while. I really do appreciate them as a partner. And in those early conversations did you have to negotiate smaller minimum order quantities and a smaller batch or did you have to basically jump in and order you know thousands of bottles? Yeah so I did end up having to do a pretty big first order. Um I did 5000 for the first quarter.

00:15:10Edit So with sun care like it is they're a little bit more strict with regulations and so because they're having to kind of invest all of that so they like have a person on the team that directly liaises with the F. D. A. Because you have to pass those tests and so I did have to like plan for doing a bigger first order just because it's like not super worth it for them to be doing tiny quantities. Um What I did convince them to do is before we had passed our FDA testing I started to basically waiver people and have them test the product and so from that like to do that we were doing some small batches that enabled testing and that was kind of the compromise there. Um and then once we passed the testing, I did my first order of 5000, wow, that must have been such an exciting moment to be like okay let's hit the button, I'm really doing this, this is gonna be my business and my thing, there was a lot of false starts uh so like yeah you know I went out to my manufacturer for the first fill for the first production in Phil and like again just like with things that are considered drugs, everything has to be super super exact and so I flew out there to be there for the first Phil and we realized that an ingredient didn't match up exactly to what we had used in the batch like the smaller batches and so that ingredient had to be ordered um And again it's like an FDA thing where it's like if you test a certain formula, like the formula has to be, you have to produce what you tested including down to the ingredients and where they're sourced from.

00:16:48Edit And so that was a false start. So we ended up having to like scrap that day and uh just like you know wait for the ingredients to come and still on another day. That is so crazy how long did that process take from when you kind of met the manufacturer and decided okay let's start sampling together too, You know getting that first batch of 5000. Yeah, so my initial, I initially thought of the idea for a habit and probably like August 2018 and it took me a good six months to find the right manufacturing partner. I did start down the path with another manufacturer that just didn't really work and then found my manufacturer that I'm working with currently. So that actually I always tell people that took longer than actually formulating um and longer than you probably expected. Oh, for sure, for sure. And then when uh like I love the chemist that I work with, um she's my age and she kind of Just gets what I'm trying to do, what we're trying to do.

00:17:51Edit And so um once we started, I wanted to do a missed for our first products, our first product is number 41, it's an SPF missed. Um it's very minimal, very clean, it's only 16 ingredients, whereas most sunscreens have 30 plus. I really kind of just wanted to pare it down and make a really pure clean sunscreen product. So I like wrote a brief against the product that I wanted to build. That was definitely more on the like non technical side. So I wanted to talk about how we would take the product market the claims that I wanted to make, how we would package it, how would look and feel um once I took that brief to start working with her chemist, she helped me kind of like fill out the technical aspects of it, but I think by that time, like it felt, it felt good, like I felt like we were moving and that started to move a lot faster. So that took around three months. The FDA testing took another three months. But while we were waiting for the FDA testing to come back, we were um, like I mentioned, we like wavered people and started testing with, with actual, uh, real consumers.

00:18:58Edit Oh my gosh, that's so amazing. And then what I'm also wondering is like, how did you fund the business? Was it personal savings? Was it a lot of capital that you needed to hire someone to create a formula or formulation? So I've been, so I was bootstrapping it at the beginning at first, basically through savings. And then I did a small round of basically friends, family and I have uh, one institutional investor that does like super, super early stage because when I pitched them, I was super, super, like didn't have a formula stage. Um, and so that's kind of how I've been funding it, but I've definitely been like funding it as the need comes. So when I was looking for manufacturers was basically just on my own, like super bootstrapping it, I worked out a deal with my manufacturer where I was not paying for the development but had committed to the, to the number of units that I would buy and basically when I was ready to start going to market and while the FDA testing was finishing, I raised money from the institutional fund.

00:20:09Edit Amazing. Yeah. I think it's it's tricky because sometimes you don't know whether like you should invest all of your personal savings or if you should go and get a loan from the bank or you know what you should do. So it's always interesting to hear how other people have done it, especially in the very early phases of getting started. Yes. Yeah. I mean I I think that it's kind of a personal decision. Like I ended up, you know, I ended up taking money from a VC and so I'm on that path an hour, You know, that is a certain path and there are student expectations with taking bunch of capital and you know, raising subsequent rounds. Um, but I, for me, I I feel very strongly about this uncanny category and I feel like it's going to grow. And so that trajectory, I felt aligned with venture capital and so that was the round I decided to take and like, honestly, like I also just didn't know how to go and get bank loans. I had friends, I have friends that went that route and I basically like got advice from them on how to approach investors and how to kind of structure my pitch in a way that would be attractive to venture capital.

00:21:21Edit Do you have any tips or learnings that you think other women should know when going into those meetings or or when trying to find A V. C. Yes. So I always say like and I'm still doing it so like we're going to raise another round soon. Um It is extremely tough. I think that I had heard the statistics about being a woman and raising capital and then but you hear them and you kind of don't like internalize that. That's t