Jim Phillips

Deficit marketing is an easier start but can be a long term trap for supplement brands. When you position a product around fixing a deficit (brain fog, fatigue, attention issues), you find an early adopter customer persona that identifies with having that problem. People already looking for a remedy convert quickly on performance creative. The hidden cost is that deficit marketing creates a stigma ceiling and turns off wider audiences. What got us to $25M isn't going to take us to $100M+ The moment your brand is defined by what is wrong with someone, a massive segment of potential customers checks out. Most people do not identify as impaired or broken, even when they want their mind to operate at a higher level. We've been executing a positioning shift at @graymatter_co : • Reducing deficit-based marketing • Moving toward high performance • Supplement your mind, like Gatorade for cognitive performance Gatorade did not build a brand by targeting severe dehydration patients. They targeted athletes who wanted peak performance, and everyday consumers followed. Treating cognitive wellness as everyday mental fuel for performance unlocks a much larger space than positioning as a fix for a problem. So far it's working: this Landing Page is converting at 3.72% compared to the control at 3.2%. If you have feedback on it let me know. trygraymatter.com/pages/high…

Our TikTok account got erroneously suspended a few weeks ago. Anyone selling on TikTok knows how messy the backend is. Once we got reinstated, ad delivery on GMV Max stalled out. We lowered our target gmv max ROI down to 1.2 on a $500 daily budget just to force delivery. It was a short term fix with potential longterm consequences. Lowering target ROI to force spend trains the machine learning algorithm to seek out permanently worse margins. You break your own unit economics at the algorithm level. We paused the entire campaign for the weekend for a hard reset, relaunching Monday at 2.5+ ROI. TikTok proved the creator affiliate method at scale, but the operational friction is exhausting. (At least for supplement brands!) Now companies like Trybe are taking that model to other platforms with hopefully far fewer operational headaches. Relaunching Monday to see if the reset worked and setting up Trybe next week. Let ya know how it goes 🫡

On June 9th we crossed 100,000 orders on Shopify. In July we passed $20M ARR. We're growing 40% month over month. Last month our ad spend grew by 50% and CAC stayed flat. I'm not sharing those numbers to chest bump. I'm sharing them because they tell you something important about what people actually want right now. When Novisa Petrusich and I started Graymatter, the thesis was simple. The quality of your mind determines the quality of your life. Your brain runs everything. Your decisions, your energy, your relationships, your ability to show up and do hard things. And yet most people do absolutely nothing to support it. We believed that if we built a plant-powered cognitive supplement that people could actually feel working, the market would be there. That belief came from a personal place for me. In my late twenties I discovered cognitive supplementation & meditation could reduce anxiety by literally changing the physiology of my brain. I became convinced that cognitive wellness wasn't a nice-to-have. It was the foundation of everything else. What the numbers are telling us now is that a lot of people already feel the same way. The brain wellness market is projected to reach $23.5B by 2030. Our fastest growing segment is adults 30 to 64, professionals and parents treating cognitive vitality as a career asset and a longevity play. They want clarity and sustained focus without a prescription and without the jitters. I genuinely believe brain wellness is the next major category in consumer health. Gut health went mainstream. Sleep became a performance metric. Recovery tools went from pro athlete to everyday consumer. Cognitive wellness is next, and it might be the biggest because your brain is upstream of every other health decision you make. What's been most validating isn't the revenue. It's the messages. Customers telling us they dropped their stimulants. People saying they notice a difference they can actually feel. Tens of thousands of reorders from people who decided this is just part of their day now. The data shows it too. We have the highest new purchase subscription rate I've ever seen in CPG (96%), and July was our best month of retention ever. We have a lot more to build. But here's our mid-year update on bets we're making to ensure our infrastructure matches the demand. • Promoted our best contractors to full-time roles with equity. The people building this company should be owners of it. • Launched Amazon, TikTok Shop, and Wholesale. Time to meet people wherever they already shop. • 15+ AI agents run Graymatter across support, finance, creative, and ops, including an AI CFO in Slack and agents that grade other agents. Team of one, output of a department. • Our first clinical trial is starting later this fall. • Launched a YouTube channel, "Building the Brand," documenting the entire scaling journey in real time. • Exciting R&D on new products. • Made a seed investment off our balance sheet in Adessa, a complementary cognitive wellness company building something special. Their round is filling up fast. If the space interests you, reach out and I'll make the connection. The signal is loud and clear. People want to feel sharper, calmer, and more resilient, and they want to get there without side effects. $1M to $20M in about a year. We're just getting warmed up. We'll keep you updated on our timeline to $100M.

I was today years old when I found out Amazon protects fraudulent resellers at the expense of established brands. We spent weeks getting compliant to sell on Amazon. GMP certification, Eurofins testing, ingredient sampling. All of it. Then Amazon let anyone sell our product on our listing with zero verification. Drop shippers who didn't even have our product were winning the buy box with 3-4 week shipping times. Customers had no idea they weren't buying from us. Within weeks, hundreds of third party sellers appeared. 196 accounts identified, 147 active subscribers gaming our intro offer, holding ~$51K per billing cycle to fund the arbitrage. So we went to war. Cancelled all 196 accounts. That was $51K per cycle in revenue we chose to eat. Custom coded logic with Contara to block reuse patterns on the intro offer. Built "Warden," our own AI reseller defense system that watches every order, recognizes operation fingerprints, freezes bad orders in minutes. Rule we live by: AI investigates and recommends, human decides, code executes. Then we bought our own inventory back just to reset the listing. If you're launching on Amazon, take asin protection steps on the front end and budget for enforcement, not just compliance.