Scaling an Amazon business to 8 figures is something Fernando Cruz and his partner personally achieved. Fernando works for Marketplace Ops, which superchargeas Amazon sales for brands by managing their accounts.
Fernando and his business partner had a tech background
Each put in $20K into the business.
They tried to build Shopify store for 5 months. It was really hard!
At the time they were thinking in a very binary way.
They came from tech – which means raising a lot of money and you dilute your own equity in response.
They had mixed feelings around that.
You start to get freedom. But by raising venture capital you now have a boss!
So they decided that they didn’t want equity funding but were comfortable raising debt.
The issue was that they weren’t comfortable with spending money on ads.
They had built partnerships – Fernando had been head of sales – and blogs.
But because they were boot strapping, they found that the time to go from zero to customers on a blog is too long and they were full time with it.
If they had had a hybrid strategy with paid ads, that might have worked.
It was originally a passion project and then they shifted to making money!
Found a course online and downloaded it and pivoted completely.
They started with 4 products at the same time which helped them learn a lot.
Hired a coach right at the beginning which was useful.
He was already doing $45K a month
6th-7th product was a home run. Had to borrow lots of money from family and friends.
They found some niches that were pretty competitive
One that was a reasonable success that died after a few months
Did more in 1st month on amazon than 5 months on Shopify.
Over $2M in 1st year then started expanding the home run product lists
Borrowed maybe $200-250K
Went to everyone from high net worth
$30K from a friend and $30K from a parent.
If your products take off, you need more cash. So they refinanced one of those for $100K
Pushing for terms is a better move but they didn’t know that then!
In the second year, they went for an SBA loan – but you need 2 years’ financials
Now Fernando is a little more wary of debt but was very aggressive.
Some of the stuff they started tracking was
They realised neutral and successful products represented 90% of products after became successful
They focussed aggressively on Amazon only on private label.
Some people want to do RA, Merch, wholesale and then diversify onto Shopify all within one year!
Now is a great time to get good at finance!
Get really detailed about book keeping.
Slow down and consider diversification.
Amazon was the arbiter of your product is “essential” or not
Set up Systems and team to be really quick and nimble
– focus on and dial in:
Fernando has the brand management agency
Create 3 scenarios:
Often you’ll find your worst case scenario is not that bad.
If your mid case scenario says you’ll be $10K down, you can
For a free consultation, visit https://www.marketplaceops.com/ For other examples of rapid scaling on Amazon, check out these podcasts: Ashley Pearce on scaling his business to 7 figures in 3 years Will Tjernlund on evaluating the competition