How To 10x Your Business’s Success With a Licensing Deal - InstaFire.com
Have you wanted to grow your business into a phenomenal success, but the demands seem too high for your small operation? Then securing a licensing deal may be a smart option. Today we talk to Konel Banner, Co-Founder and Inventor of InstaFire.com, who grew his startup to $1.6 million dollars in revenues before getting a deal. InstaFire's revenue is now 10 times higher. Join us to learn from Banner about starting out as a novice entrepreneur, securing a licensing deal, and building more successful products.
In today’s episode of the Harvest Growth Podcast, we’ll cover:
Leveraging digital platforms to grow revenues exponentially.
The right and wrong ways to seek idea and product validation.
Finding easy mentorship opportunities for inexperienced entrepreneurs.
And so much more!
You can listen to the full interview on your desktop or wherever you choose to listen to your podcasts.
Or, click to watch the full video interview here!
Go to InstaFire.com to learn more about their highly-rated fire starter, which you can use anytime and anywhere, including windy areas and wet spots.
Do you have a brand that you’d like to launch or grow? Do you want help from a partner that has successfully launched hundreds of brands that now total over $2 billion in revenues? Set up a free consultation with us today!
Prefer reading instead of listening? Read the full transcript here!
Jon LaClare: The business we discuss today secured a license deal, then moved the focus of the business away from brick and mortar and into e-commerce and direct-to-consumer marketing and grew their revenues 10 times.
Intro: Are you looking for new ways to make your sales grow? You've tried other podcasts, but they don't seem to know. Harvest the growth potential of your product or service as we share stories and strategies that'll make your competitors nervous. Now, here's the host of the Harvest Growth podcast. Jon LaClare.
Jon: Super excited to have Konel Banner on our show today. He's the founder, or co-founder and inventor, of Insta-Fire, Instafire.com. Really cool product and a great success story. I can't wait to really dive into this interview. I think you're really going to enjoy it as well. Konel, welcome to the show.
Konel Banner: Hey, thank you. How are you?
Jon: Doing fantastic. Let's jump into the product itself. I want to get into your history in a second, but for the benefit of our audience if you could let us know what is Insta-Fire? How does it work?
Konel: Insta-Fire is an all-natural fire starter, charcoal briquette lighter or emergency fuel. You can use it to start a fire or use it as a fuel source to cook your food, let's say in an emergency. It'll work in basically any condition. Biggest one being wind, I've had it in 40-mile-an-hour winds. It'll float and burn on water. You can literally hold it in your hand, and if I can hold it in my hand, I can burn it on snow, ice, sand, or whatever. You just touch it with a match and once it's lit, it'll take basically all you can throw at it.
Jon: The temperature, I understand, gets up to 3000 degrees. How does that compare to a regular fire starter or fire?
Konel: Regular fire's about 425, so it's way hotter than a regular fire. It's made from volcanic rock, so the rock basically heats up like I did when it was a volcano and so it just intensifies the heat.
Jon: That's very cool. What have you found are some of the benefits of getting hotter than a regular or traditional fire starter?
Konel: Well, most of your problems come-- I don't know how many of you have camped, but most people get up in the morning and they got dew everywhere, or it's been raining all night and they've got a fire, or they want to start a fire to get warm and they can't because everything's wet. This, you just put a little bit down, it's granular, so you can use if you've got real wet wood, you use a little bit more. If you've got fairly dry tinder then you just put a little bit. You don't have to gather all the sticks and twigs anymore, so you just put a little bit down and you light it and then it burns hot enough and long enough where the dry out wet wood and then get it going.
Jon: That's fantastic. That extra heat obviously helps dry out the wood on top, I'm sure. As we build, we camp a lot as a family, and I'm not the world's greatest fire starter, it's always a problem. We have fun with it, but it's something you have to master. It's difficult to do it the normal way. With tinder, it seems like it burns off too quickly before the logs catch fire, et cetera. It's just always a process. As you said, this lasts longer. If you've got a mound of this or pile, or whatever you call it, of this below your logs, et cetera, how long does that last before it goes away or stops burning?
Konel: Long pouch, we sell it in different conglomerations, but one of them is a pouch. It's about a half a cup. That half a cup will last about 10 to 15 minutes with occasional stir. It has a tendency to crust over because it burns from the top down, so that's why you can put it on snow, ice. It's a little bit of a crust after five, six minutes, but most fires are going by that time anyway. It's all good.
Jon: No, for sure. Even for someone like me, I think I could get it hopefully going by that point, but if not, as you mentioned, you could throw some more on and keep it going longer, right?
Konel: Well, it's the easiest fire you'll ever light. You put it down, you put a log over it, a split log and it just burns. It just works every time.
Jon: Love it. You mentioned you could actually hold it in your hand and light a fire as well without that heat going through, at least at the beginning.
Konel: Yes, it's naturally insulated. We just do a demo where you hold it in your hand it doesn't burn you. You can put it down into water and it'll sit and float and burn right on top of water then you can pick it back up. Now you got water dripping down here and fire up above. It's probably not the best idea to try it all the time just because we know what we're doing, but somebody's going to get burnt. It just demos for us what we're trying to tell people.
It's just a safe, easy way you can store it. It's the only fire starter that I'm aware of that you can store as much of it as you want, anywhere you want. You can put it next to a water heater. A regular spark won't light it, so you can put it next to a water heater, a furnace, whatever, and just store it forever. You can store it for 30 years and then you got a natural disaster and now it can cook your food.
Jon: Oh, fantastic. How'd you originally develop or come up with this concept?
Konel: Well, I had on my mind, I've always been taught to prepare for a natural disaster or personal disaster to have a little bit of food on hand. One of them was fuel. I grew up in Idaho and eastern Oregon and we always had big barrels of diesel, or whatever. I knew I could always have a fire or a way to cook, but when I moved to the city, I'm going, "How do you store fuel?" I had that on my mind. My sister was in the Teton Dam flood and so she had about 15 minutes from when the dam broke to actually when it hit their home.
Anyway, emergency preparedness has always been part of our life and makeup, if you will. I was in a mountain man rendezvous and I saw an old man burning a rock and I thought, what the heck? I was a scoutmaster at the time, and so I bought some of the rocks, this for novelty purposes, so I show the scouts that I could burn a rock. Well, I brought them out three or four months later and went to light the rocks and they didn't burn, and well, whatever.
About a year later, I saw this old man and I said, "You're that horse's rear end that sold me those rocks that didn't burn." We laughed about it for a minute and he says, "Let me show you what I'm doing now." He was using some real nasty stuff, but he had the premise and I said, "I don't mean to steal your idea, but I'd like to develop it. I'll pay you a royalty if it ever comes to fruition." He was 80 years old, thrilled to death.
About that time I met my partner, Frank Weston. We spent nine months, pretty much every weekday for a couple of hours early in the morning just playing. First time you throw a match, woo, no, that's not what we want. Next time doesn't light at all. It took us about nine months to get what we have now.
Jon: Oh, that's fantastic. A lot of good work to get an easy product. You want to make sure you do that work upfront, obviously to make it easier for us as the end-user or consumer of the product. It makes it worthwhile, easy for the consumer.
Konel: The only thing it does is that it burns hot enough. Most fire starters cannot light charcoal and this will light even lump coal, but it will light charcoal, for sure, so that's a great thing too. You don't have to have lighter fluid to light charcoal.
Jon: Fantastic. Curious, you talked about lighting on top of water because of the insulated layer on the bottom, but if you get the material wet in storage or something like that, you talked about your sister's flood in that area, if it becomes wet, is it usable after that?
Konel: A couple of things you can do. Let's say you're in a canoe and you dump, you fall over and it gets soaked, you're in bags, but somebody left it open or whatever, you can gather it up and squeeze the water out because it'll absorb about 10 times its own weight in moisture. You squeeze the water out it'll sit and pop, but it'll get a fire going. If you just let it dry out, squeeze the water out, and let it dry out, in an hour or two, it'll be just like it was before.
Jon: Oh, that's very cool. Fantastic. Great product and you've had some great success over the years with this as well that I want to dive into. Right now your business, so you did a license deal, and we'll talk about that in a minute. I want to talk about just generally where it's successful. Where do you find most of your sales coming from, from retail, e-commerce, et cetera? Where have you had the most success since you launched?
Konel: When we launched, we went on a place called Jim Bakker, the preacher. He wanted to use it for emergency preparedness, so he sold about 10,006-gallon buckets in about an hour of demo. I turned to Frank and I said, "I guess we're in business." That's how it started. Then people wanted to use it, not just for storage, to store it, but to actually use it for lighting charcoal, lighting a fire, that kind of thing. We put it in little pouches. Most of the product is sold as a fire starter rather than emergency fuel. We were selling to places like Walmart, Target, Home Depot, Lowes, Cabela's, those type of places.
Then two years ago, we were purchased and they are more of a direct-to-consumer. We've shied away more from retail that we did as Instafire and now they go mostly direct to consumer.
Jon: We talked about the numbers of the business previous to the sale. You rose it up to about 1,600,000 in revenues.
Konel: About 1.6.
Jon: In the last couple of years since the license deal's taken place, it's now well over $10 million in annual revenues, so great success. I know you're still involved in the business. Are they continuing to sell in retail at all? You said it's moved primarily over to Amazon.
Konel: We sell on Amazon. We sell on a few places. It's still in Academy Sports and some of those places, but mostly the retail, they wanted to have, honestly, more margins. If you can get it direct to consumer, it's a win for them.
Jon: The business has grown in multiples. That's fantastic to hear. I think it's good too. A lot of our listeners may have businesses that are in that ballpark, that are $1 million, $2 million in revenues and they don't think it's ready yet to be sold. It might be too early. They're trying to skyrocket that growth. There can be an earlier stage. That's a very successful business, of course, but it can be a great time when you find the right partner. If you could maybe just share with our audience, how is the royalty deal? We don't need to get into numbers, et cetera, but how has it worked out in general for you and the business since that dealw was done?
Konel: I love it because I've always had a lot of-- The part that I love is the inventing part. When they bought us, they said, "Hey, we need to do all the transfer of everything." We've gone through that. I said, "I don't want to run the day-to-day stuff anymore." He says, "What do you want to do?" I said, "I just want to invent new products." The deal we made was, with every new product that I bring them as far as invent something, go through the patent process, then they take on that hit. They pay for the patent, they pay for all those attorneys and all of the research that goes behind it.
Sometimes you'll be into $0.25 million or $0.5 million dollars before you ever get a real product, and then we launch a new product. I just said, "Hey, I want a royalty for a period of time off of the new items that I bring you." They said, "Yay, that's what we want. Let's do it." It's allowed us to launch a lot of new products fairly fast that we've had in our mind or whatever. To me, it's been a great win-win.
Jon: That's fantastic. I think the license deal model has changed over the years. It used to be 20, 30 years ago where a lot of inventions could be created, patented, and then licensed off before revenues were even generated. Now, what you've done is much more of the trend of show some proof of concepts, show that it's working. You can actually get more value out of it, a higher rate typically, than you would if you just sold the patent outright with no proof. That's a great example of the way the model has morphed over the years.
Konel: One of the challenges that most inventors have is they invent this great product and then they go to sell it to somebody. Then, now they've got to convince them to sell it. "I'll try it." Then they try it," so then they try it or they'll say, "We love it, but can you add this feature?" They've already paid me for the molds, they've already done all of that, and so it's a very expensive process to change it.
With this model, it allows us then to sit in meetings with them, "What features do you want? Here's the idea, here's the concept. What ideas do you want?" They already have the sales avenue to go through. Now, we have a sales channel already, and they said, "Here, we've got this problem. Solve it." Then we solve the problem and they just go gangbusters. It's awesome.
Jon: Perfect. Along the way in your journey, have there been any resources that have been helpful to your business that you'd recommend to our audience?
Konel: We went to a place, it was an entrepreneurial college in the state of Utah. They're very entrepreneurial-driven state, and so they'll have little colleges, little workshops, where people who have done it before teach. That was very helpful to, "What process are you in, or what phase are you in? Are you in the marketing phase? Are you in the development stage? If so, what can we do to help?"
They would have mentors come in who have done that particular part of it, and then they would sit down with you. That was very helpful. If somebody is going through a startup, it's very helpful if they can get an entrepreneurial college. It wasn't very much. It was just a little bit, but all these guys with knowledge that wanted to give back. It's just wonderful.
Jon: That's a great resource. I'm glad you brought that up. I don't know if we've ever discussed that on this show, but we've had clients of ours use resources like that, especially in the early stages, just to lead into, like you said, experts that have done it before to avoid some of the pitfalls that we might fall into if it's our first time through. You can't know everything before you start a business for sure.
Konel: To realize that you don't know everything and to just say, "What don't I know? I don't know how to market online, or I don't know how to get over this hurdle, or how do I really protect myself, my patent? Can I go with the cheapest attorney? Is that the best way or is it best to get a high-end?" All of those questions. They were able to walk us through that scenario, so it was good.
Jon: Oh, that's fantastic. Are there any questions I didn't ask that you think could be helpful for our audience?
Konel: Sometimes, I think you mentioned it, but I think it's very important to reiterate, and that is people will say, "You've done it. You got on Shark Tank, and that was a great thing. You got Mark Cuban and Lori Greiner behind you, and that's wonderful." What they wanted to know was, what proof of concept do you have? Most people go to their neighbors, their friends, and family and then those people say, "That's a great idea. Go for it."
Who you really want to go to is people you don't know and say, "Hey, I've got this idea, or I've got this product. What do you think of it? What do you think it would sell for? What would you be willing to pay for it? What features would you like to see on version two?" Just start asking a bunch of questions and people will give you those answers, but you got to ask. Don't just get locked into family and friends. They'll just tell you what you want to hear and then you end up getting burnt.
Jon: That's great advice. We do a lot of market research as a company. I've given similar advice over the years where, in the very beginning, just to get quick answers back, talking to family and friends can be okay to guide direction, but like you said, that level of separation is necessary in any market research you do. They can be objective and they're not going to be nice to you just because you are who you are. They'll be more honest with the product. Whether that's a focus group or whether that's selling at a trade show, but talking and selling to people.
Konel: Exactly. Trade shows, local events, fairs, Amazon, eBay, those are great things because you put a product up there and there are people willing to buy it. They'll give you feedback real quick.
Jon: Absolutely. Konel, this has been a really fun interview. Awesome product. I do encourage our audience, please go check out instafire.com. As always, it's in the show notes. If you're driving, go check it out later. Konel, [crosstalk]--
Konel: I did have one other thing I wanted to bring up if that's all right. Back two years ago, Houston, they had the hurricane came through and wiped out a lot of their facilities. Soon after that, they had the power grid go down and it was a mess. They had ice storms, that kind of thing. The boss turns to me and he says, "Konel, figure out a way to heat those homes without electricity." Then so we built this device and it worked pretty well, but it had a battery-powered fan and he said, "I don't want a battery-powered fan because somebody's gonna set it up in their attic or whatever for 10 years. Then when they have a crisis, they're going to go get it and their batteries are going to be bad."
He said, "Figure out a way to run that fan without batteries." We said, "Okay." Well, so we were able to turn fire into electricity that then powered the fan that blew across hot fins and now blows out into a room so you can hit heat at 200 square foot room with the canned heat, which everybody knows the Sterns of the world that create the heat. We use one of those cans to gather that energy and then blow hot air and to add into a room. There's, by selling the company, it allowed me to come out with something like that, which launched them. I mean, we thought we had three to six months' worth of inventory and it sold out in seven days.
Jon: Wow. Fantastic.
Konel: It's now just drone and morphing and morphing and now other products have come behind it, and it is just great. Don't get locked in, and I guess is what I'm saying, just to your idea, it may lead you to something else.
Jon: I think the other benefit, going back to doing a licensed deal when you are someone creative like yourself, if you're running the business also, you can get bogged down in the details and you lose time, frankly, or open head space to be creative and come up with ideas. You may never have come up with that if you're running the day-to-day operations of the original InstaFire too. That's another,
Konel: Then you get a call from the ambassador of Finland and he said, "Hey, I want 50,000 of them for Ukraine."
Konel: It's like, "Holy cow, well, I don't have that many in stock," but then you start getting trucks on the road, "Let's do it quickly." It's just fun to be a part of where we couldn't do that by ourselves and it's nice to have a company that's able to fund something like that.
Jon: Absolutely. Well, Konel, this has been a lot of fun. I really appreciate your time today.
Konel: Appreciate too.
Jon: Go check out instafire.com to learn more and be sure to check out harvest growth.com to see other episodes we've recorded. If you'd like this episode, you want to learn more about how you can profitably grow your consumer product business, please subscribe to our show. You can set up an appointment right from our website to speak directly with a member of the Harvest Growth Team and get a free consultation to learn the process that has worked for hundreds of businesses since 2007.
[00:23:31] [END OF AUDIO]