Mike Salguero knew he wanted to be an entrepreneur from the beginning. He got his start as a paperboy and worked many jobs along the way, but found he wasn't even really working for himself his first time as a founder. Three days after his first startup folded in 2015, Salguero started ButcherBox. It's made him a millionaire hundreds of times over, he has no intention to sell, and his biggest advice is counterintuitive: don't raise outside funding.
Category
🤖
TechTranscript
00:00 We told our Kickstarter backers if we got to $100,000 in sales,
00:06 everyone would get free bacon in their box.
00:08 And then when we shipped out those Kickstarter boxes,
00:11 every single box we put a pack of bacon into it.
00:14 And then we turned on our website because Kickstarter was done.
00:18 We turned on our website and started selling subscriptions.
00:22 About two weeks in, my engineer calls me.
00:25 He's like, "We have a problem."
00:26 I was like, "Oh, what's the problem?"
00:27 He's like, "So it turns out that we've been giving everybody free bacon,
00:32 not just the Kickstarter people, but everyone who signed up.
00:34 Everyone has gotten free bacon. It's a problem."
00:37 And I was like, "Okay, that does sound like a problem. Can we fix it?"
00:43 And he's like, "I don't think so.
00:45 I built the code in a way that it's just going to send people bacon."
00:48 And this marketing guy, Mike, who was working with me, he's like,
00:52 "Why don't we just tell people sign up and get free bacon?"
00:54 And I was like, "That's it."
00:57 My name is Mike Salguero. I'm 42 years old.
01:00 I'm the CEO and founder of ButcherBox.
01:02 And this is how I made my first million.
01:04 I was born in Paraguay, in Asuncion.
01:07 And my parents got divorced when I was four months old.
01:09 And we moved up to a really small farming community in western Massachusetts.
01:14 I grew up in a very small town with 2,000 people in the town.
01:19 I was the youngest of four.
01:21 So my mother's father, my grandfather, was a very successful businessman.
01:27 I had this upbringing where I would go home with my mom and my siblings,
01:31 and we didn't really have a lot of money.
01:33 Like, we were always waiting for her to get sent money from her parents.
01:38 And my grandparents would take us on these trips,
01:40 me and all my cousins and aunts and uncles.
01:42 We went to Spain every summer, and we did all these things
01:45 that were beyond the means that we had as our own family.
01:49 And that gave me just this really interesting,
01:51 like, I wanted a life that wasn't the life I was living.
01:55 The small community I was in was pretty poor,
01:57 and I saw this other path or this other lifestyle that was very appealing to me
02:02 and something that I really wanted to strive to accomplish.
02:07 I went to Boston University.
02:08 I was going to major in business.
02:10 Within a few months of being there, I was pretty bored with school.
02:13 I was like, "This is pretty easy. I don't really get a lot out of classes."
02:17 And so I decided to make the city my education.
02:19 And so for the next four years, I worked full-time while going to school.
02:23 I ended up, after a year, deciding that the business school wasn't right for me.
02:27 I was always interested in being an entrepreneur.
02:29 So before ButcherBox, I started a company called custommade.com,
02:33 and I ran that for eight years.
02:35 The last round of funding that we did,
02:36 my co-founder and I took about a million dollars off the table each.
02:40 We built into the fundraising,
02:42 "Hey, we want to take a little bit off the table as well."
02:45 And our investors were happy to do that.
02:48 We were venture-funded.
02:49 We raised a bunch of capital from Google and first-round capital.
02:53 But that didn't end well.
02:54 And while the business was falling apart and my co-founder stepped into the CEO role,
02:59 I was wondering, "What's next? What am I going to do after this?"
03:02 And so I had been getting these cow shares from a friend of mine.
03:07 He had a father-in-law who was a farmer,
03:09 and he would, on a quarterly basis, drive trash bags full of meat into Boston and then sell it.
03:17 And so I bought some from him.
03:18 And I brought it home, and we ate it, and it was amazing.
03:22 But it filled up our freezer.
03:23 We didn't have any more space.
03:25 I decided to take some of those steaks and sell them to people at work.
03:29 And then a quarter later, I decided to buy more
03:31 because the people at work were like, "Hey, next time you get that, get me more."
03:34 And then I got more, and I ended up directly talking to this farmer
03:38 and buying an entire cow, a cow share, which is like two or three bags of meat,
03:44 like trash bags full of meat, and bringing it to work and selling it to people at work.
03:48 And one of the guys that I sold to, this guy Mark, was like,
03:52 "This would be so much easier if it was just delivered to my house."
03:54 I was like, "Yeah, that would be easier."
03:57 And that began the kind of the question around, like,
04:02 how would you deliver meat to somebody's house?
04:06 So I put $10,000 of my own money in, and the idea was,
04:09 let's just see if there's a market here.
04:12 We spent the summer, I started in May, we spent the summer learning from people.
04:16 One of the big lessons we learned was people wouldn't eat that much beef,
04:20 so we knew we had to do chicken and pork as well.
04:22 And we launched our Kickstarter on September 9th of 2015.
04:27 We went out to raise $25,000 in pre-sales.
04:30 We thought that there was a way that we could gain Kickstarter
04:34 and basically get a much bigger return.
04:36 We went out to raise $25,000.
04:38 We ended up raising $215,000 in 30 days.
04:41 Within the first day, like, we said $25,000 was our goal,
04:45 and I think we brought in $40,000.
04:47 Within the first day, it was like, "Oh boy, I think we might be onto something here."
04:50 The vast majority of my net worth is ButcherBox.
04:53 I own about 75% of the company.
04:57 The rest is owned by employees and former employees.
05:00 We don't have any outside shareholders.
05:02 I'm not looking to exit.
05:04 I'm not looking to go public.
05:05 I'm looking to actually transform a broken system,
05:09 which is me, in this country,
05:11 and build a company that we can be proud of.