A few years ago, Travis Peterson accidentally started his company Joker Greeting, which sells prank musical greeting cards. It started as a small project, but when he published it on Kickstarter, he was able to raise $92,073 and got a lot of press coverage. He is now making +$30,000/month.
Hi Travis! What's your background, and what are you currently working on?
Hey! My name is Travis Peterson. I make prank gifts but I am mostly known for musical greeting cards that have no off-switch and loop non-stop, on purpose, until the battery dies. The genesis of this company started when I was 8 years old and my dad called while he was traveling to tell me he won the lottery. Then he said, “April Fools!” Every year he had a new joke and I fell for it all the time.
Joker Greeting started with making prank musical greeting cards but we now focus on all gifts and fun pranks. We prefer fun and funny gifts and not a**hole pranks. We want both sides laughing together.
Joker Greeting is based in Irvine, California and we have some workers in Salt Lake City, Utah and my warehouse is based in Utah as well. The company manufactures in China and works with another team on product design.
I am the only full-time employee, as well as the president and co-founder. I do it all: Building and maintaining the website on Shopify, talking with customers, business development with wholesale clients, creating videos for ads on Facebook and for the web, creating any new products, and managing the process towards launching of new products and categories. I could probably continue listing more jobs that I handle, with the exception of bookkeeping, packing, shipping and manufacturing.
Most sells come mainly from my website, where I sell directly to my customers, but I also sell to other online stores and catalogs. It is a pretty basic business model.
From there, I try to build out more product categories that are based 100% on Joker Greeting ideas. Right now, I have three product categories, but I should have two more really soon. Cross-selling should help me lock in new customers and grow organically. My goal is $1M in sales. This is very doable goal within two years. It’s not Facebook money but I am okay with that.
What's your backstory and how did you come up with the idea?
I have a B.S. in finance and have worked in two small investment banks in New York City for about six years. I used to love that job but I decided that I wanted to make stuff instead of watching other people make stuff. This was the beginning of me launching my “entrepreneurial” path.
I had an idea for gathering personal stories through online collaboration. While building my first company I also decided to get a MBA and meet some folks who might want to join my venture. During school, I was able to build a beta website and beta mobile app, but that was the easy part. I used a lot of my savings and some family helped me too. I went to trade shows and talked with investors. However, after 2.5 years of hard work I could never get off the ground or find the right partner to join me. Ultimately, I had to stop trying.
Looking back on my first venture, the problem was very clear, but I wasn’t able to solve it. I think the rule of thumb is making a product 10x better than current solution and my product was like 2x-3x better. I had some traction but not enough growth. And that’s why Joker Greeting took me by surprise and showed me what a startup really looks like; a solid idea grows organically and virally.
Joker Greeting started as a funny project between my brother and me. We saw a musical doll at my mom’s house and we thought that it would be funny if we made the doll sang a non-stop song. We pitched our dad because he is funny and he told us to make a greeting card instead. He was absolutely right.
There was no business plan. There was no market research. This wasn’t even supposed to be a business, it was simply a way to make $2,000, have fun and buy a PS4. Then I would move on. Instead, we raised $92,073.
How did you build Joker Greeting?
This idea started in 2012 and didn’t launch until 2015. Not because it was really hard, but because we were both distracted and working on other projects. However, this non-stop singing card kept coming back and I had to act on it. Once I started to do the work, it took me about six months to finish it. I wouldn’t say it was hard work but there were no clear answers. I knew it could be done but, who would the right manufacturer be? And at what cost? And if I work with China, do I trust them? In this case, it was pure diligence or obstinacy that got me through.
The initial prototype is what we launched with on Kickstarter. We didn’t want a super sexy card. We wanted a card that looked totally innocent and a little bit boring or dated. The biggest complication was that ordering 1,000 units was super expensive so total cost was $7/unit. When we launched on Kickstarter I charged $15/unit and that’s how I chose my price.
No real challenges arose except for some timing issues. Originally, we planned to launch in February 2015 but it was apparent that was not going to happen. April 1 was coming up and I decided to just wait longer and launch on a great day. Although no one believed us on the day we launched it worked out better on April 2nd.
Kickstarter launched on April 1, 2015. My brother shot the video in his house. We shot it in one hour and that was it. Luckily, he has a background in film directing and editing. I also went ahead and made some crappy iPhone videos but those turned out to be part of the success and shared more than our main video. In 30 days we were on ABC News, CNET, BuzzFeed, radio shows, and more and raised $92,073. While I had no plans to build a company it was apparent that I had. Halfway through the campaign I started the Shopify store, bought a domain, and did all the legal paperwork. Joker Greeting was officially born.
I flew in ½ of the Kickstarter orders and put in my garage. The next ½ was being shipped ocean and arrived just in time when this was mostly gone. I packed and shipped nearly every single one of these orders with some part-time help.
Which were your marketing strategies to grow your business?
Because the launch was so successful I had a few vendors contacting me to buy my cards at wholesale. And Kickstarter was a link to my new Shopify store so it was pretty seamless keeping the party going. In all, the Kickstarter was much more successful than $92,000 if the next 30-60 days were included. And we never spent more than $400 on marketing and ads (I probably should have).
But no party lasts forever. I’d say the next 12 months were still pretty easy. But sales started to slow down I had to find ways to keep selling cards and do my own marketing.
I tried Reddit ads, Google SEO, Google ads, StumbleUpon, Instagram, and a few small ad agencies. Facebook ads offered the best ROI. And quick videos 15-30 seconds had the most impact. I tried static images but I never saw many conversions.
Part of my growth strategy was to continue to launch new categories on Kickstarter and rely on my Kickstarter community. This has worked pretty well. I launched a device called the Cricket and raised $15,000. I struggled to sell it after Kickstarter. I was sitting on inventory and nothing was moving, maybe 1-3 units a day. I decided to make new videos and show how I used the cricket; these videos transformed my sales into selling 30-50 units a day without changing my ad spend from before. My lesson; show the customer how to use the product in their life, don’t tell them features.
Example 1: How Card Works in Water
Example 2: First Cricket Video That Spiked Sales
What were the biggest challenges you faced and obstacles you overcame?
The largest obstacle was having every single unit become defective due to a bad batch of batteries. It was my largest purchase of cards and my vendors were placing sizable POs in the $20,000 range. I learned it was all defective about 4-5 months after selling thousands and thousands of units. It was painful and embarrassing. I hated getting up in the morning and reading my emails about complaints and my customers feeling cheated. Wisely, I had kept the money in the company, and slowly I had to refund every order and resend working units later on. When it was all done I didn’t any money left, or trust with my vendors, or much else. I didn’t even know if buying new cards would save me or bury me deeper. Obviously, I chose to keep going.
My manufacturer did take the heat and offered to replace the units. But the damage was very severe. Shipping was costly, vendor orders shrunk significantly, and Amazon reviews were at one star. This Amazon effect crushed my direct sales as it was #2 on any search of Joker Greeting; a glaring 1 star. The party was definitely over. This was late 2016.
Above all, I tried very hard to be patient with every single customer. I begged for a second chance and sent them free cards when I got new ones. I cut prices with some vendors to try and keep the relationship and keep them happy. And I had to fix my Amazon rating; I stopped selling that card and made sure no one else was selling that SKU on Amazon. I designed a new card and color and relaunched a new SKU on Amazon. On top of this, I had to get more reviews on Facebook and Google but I had to wait for all my defects and angry customers to stop complaining.
Once I was able to fix my cards I was able to turn on a customer rating feedback and with 237 reviews were have 4.5 stars. Super happy about this!
Other obstacles in comparison to this are small. Personal life and family (I have a wife and two kids now) is always a challenge but I don’t think it’s any more difficult than a normal job. It’s just different challenges.
Which are your greatest disadvantages?
I stink at blogging and writing and creating daily content. I can’t Instagram or tweet very well at all. It’s just not interesting at all. I do it but I don’t think I am great at doing it. I do pay for help with writing blog posts. Blogs really do help and I wish I were better at it. I love being involved with my content but I know my limits.
Joker Greeting is small brand and so many vendors just don’t think I can sell units. Or they worry their customers won’t get the joke or that it’s too rude and no one will buy them. Being small has other advantages but when trying to work with vendors it’s often not helpful.
During the process of building & growing Joker Greeting, which were the worst mistakes you committed?
The biggest mistake was pushing other non-traditional ideas too quickly. I knew that Birthday and Christmas cards were selling really well. I should have really focused on those two a lot more rather than pushing my Baby Card, and I’m Sorry, and other cards that sell less often. I ended up with too many units sitting on the shelf and not enough of the units I sell through.
If you had the chance to do things differently, what would you do?
I am not a regretful person when it comes to business. Things happen and I choose to move onward. Challenges and obstacles, I didn’t see before were necessary to learn so I don’t think I would change anything. I enjoy my job and for whatever reason, I get up every day and work in my office all day and I don’t take as many breaks as I should. It’s fun and I enjoy it.
Many startups are fearful about talking about their idea as if it will magically work in someone else’s hands better than yours. And quite frankly, if that is true, then you probably shouldn’t be doing it. Be more open to ideas and don’t worry about competition as much as you do. Tell more people than you normally would and doors will open.
Apart from mistakes, what are other sources of learning you would recommend for entrepreneurs who are just starting?
Books are very inspiring. Creativity Inc, by Ed Catmull explains the great way in which Pixar was built. I think this book taught me not to control the process but have the process (and people) speak up. Listen to them. And hire people better than you.
I just finished Principles by Ray Dalio. A very deep dive into employee management. An absolute stunner beginning to end. It’s almost more of a textbook than others.
The Hard Thing about Hard Things by Ben Horowitz is a must read to scare anyone straight who thinks startup life will be fun. Lots of people tell me I am living the dream. I guess, if living the dream owning up to all the problems and taking all the risk.
Thinking, Fast and Slow by Daniel Kahneman is amazing. This helped me deal with customers better and think about my copy on the website and emails. I can’t recommend this book enough but you definitely need to be willing to get science. A lot of these concepts are also covered by Ray Dalio.
Where can we go to learn more?
I encourage anyone to learn more at our website, and say hi or buy a card. I really do like helping anyone who might have questions. So just ask them below!