271: How to Breathe Life into a Business... Dr. Dan Cohen of Breathe Right Strips

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Speaker B: They called us up and they said, congratulations, you just rewrote the textbooks on how to introduce a consumer product. M they started to wear it and overnight we became a $50 million business. One of the best things we did was to find the right.

Speaker C: Buckle up. Why? Well, because you're about to enjoy another awesome episode. But before we do, just want to let you know, we also had a group call with Dr. Dan Cohen. Um, it was group call 11. And so that's available for all Patreon members. So if you enjoy this episode, be sure to check out group call 11 with Dr. Dan Cohen, where he answers questions from our Patreon members. Now onto this episode.

Speaker B: Hi, Austin. I am very glad to be here. My name is Dan Cohen. Right now I work on some unusual products. But prior to this, I had become, uh, a medical doctor, a neurologist. And I was really more interested in business and working on certain product ideas than I was in taking care of patients. So right after my residency, uh, within a year, I started a company by the name of cns, Inc. Cns, uh, stands for central Nervous system. So it was in line with my specialty as a neurologist. And we worked on a number of products over a number of years. Uh, the business was in operation between 1982 and 2006 when we sold it to GlaxoSmithKline. So we had a lot of history and, uh, a lot of fun with

Speaker C: it right out of college. You were a doctor, but you're also kind of an entrepreneur.

Speaker B: Yeah, you know, I never really thought of myself as an entrepreneur. I never really considered it, quite frankly. I went to college at Penn State, then I went to medical school in Philadelphia, Temple Medical School. And then I came out to Minnesota at the University of Minnesota to do my neurology residency. So it's a 12 year process. So by the time I was done, I was 30. And by the time we started the business, I think I was about 31.

Speaker C: Okay, tell us about CNS. I guess in growing from 31 to where you are today.

Speaker B: Well, actually, CNS began at zero. When we started out in 1982. We had some ideas there Were a couple of neurologist. My partner stayed out in practice. I was the younger of the two of us. So I came in and did the business. When we started, our first idea that we thought was the most commercial was a, ah, brainwave monitor to help prevent strokes during high risk surgery. So we would actually look at the eeg, the electroencephalogram. And what we did is we were one of the early people to computerize that. So we took the information and we put a picture of the, of a head up on the screen and had little pie charts showing the different aspects. And we develop automatic warnings if there was a problem. Particularly during open heart surgery where they use the bypass pump, blood flow can be reduced to the brain and also carotid endarterectomy where they have to clamp the major artery to the brain and hope that they get enough flow from the other side. So we started out with that project and that was, it was an interesting project in that we were able to implement it, develop a product, we validated it at the Mayo Clinic and then we took it out in the market. I would go out with the salespeople for the first three months. You know, every week I was in another hospital doing product demonstration. And it was obvious to me after three months that this was going to be a, uh, total flop. Fortunately for the existence of the business. When I came back and reported this at a board meeting, my board of directors said, you know, what does he know? He's a doctor, he doesn't know business. And so they figured this guy probably just has the wrong salespeople or he can't sell himself. Let's just bring in somebody who was a well known salesperson at a big company and he'll solve the problem for us. That was the thinking.

Speaker C: So what happened?

Speaker B: Well, we brought in a really good guy. I mean, nothing wrong with the guy. He took over that project and quite frankly it never really amounted to anything. He couldn't do any better. But the good news was that the board of directors and our investors, we had a number of venture capitalists by that point. They thought that this was definitely going to be a winner, so they were willing to keep trying. And what that allowed me to do was to start another project within the company. So I took the same hardware that we had developed and I morphed it with software into a product to help sleep laboratories, sleep disorder centers do their diagnostic work. So we made it a more automated sleep disorder diagnostic computerized device that they were really interested in. And we ultimately made a business out of that, the other business failed. The OR business failed. And after about five years of trying to make it work, we finally, uh, discontinued that product line. But by then we had a thriving business in sleep disorders diagnostics.

Speaker C: Were you practicing at the same time? Like, what was your time management like then? Dealing with all this kind of coming out of school and seeming more like a business guy than, I guess, practicing as a doctor?

Speaker B: Yeah, no, you're right. I mean, I was full time with the business. I was board certified. I could have gone into practice at any time. I was 100% operating the business.

Speaker C: So when you're spending that much time doing it, so you have to keep things up to make sure that you could practice if you wanted to again. Or since then, have you always been more on the business side?

Speaker B: I was always more on the business side, but for, for some reason, you know, I never really considered going into practice, but I always did maintain my board certification. So if I needed to go into practice, I could. But quite honestly, even though I maintained my eligibility to do so, I don't know how well I would have been qualified, especially after, let's say, 20 years of doing that, because I really hadn't been practicing. And so I was away from the mainstream neurologic practice.

Speaker C: So what would you like to jump to next? Because it seems like you have got a lot of good stories for us today. For the entrepreneurs who are listening, what do you think would be most helpful on your experiences that you've had so far?

Speaker B: Well, I think when I look back at those early days, I think one of the things that was important was developing credibility with my board of directors, who were a lot more senior and more experienced than. I mean, because they looked at me and they said, you know, he's a doc, he's not a business guy. I was really interested in this business becoming very successful over time. And so I wanted them to view me as more than a doc or a scientist or a guy who could also write software. I wanted them to look at me and say, you know, this guy can make good business decisions. It was really important for me to develop that credibility with them. And I think the way that worked out was by me being completely honest with them. It's like, for instance, going back to those early days when we had the operating room monitoring, it would have been easy to say, this is going to work. Don't worry, this is going to happen. But by me claiming three months into the selling process that, guys, this isn't going to work. And this is why it's not going to work. And I was brutally honest. I told them that people like the surgeons and the anesthesiologists, they didn't want something in the operating room that could actually document that it was their fault this person had a stroke, because guess what? You left them on the pump too long, you had the blood pressure too low, or you didn't notice this or that our technology could actually, actually assign blame. And once you realize that, then you realize this product will never be successful until these surgeons and anesthesiologists change their mode of operation. And so it became very clear to me that this wasn't going to work. And so I was very honest with the board and I said, guys, I don't think this is going to work. I'm not opposed to having somebody that's more experienced at sales come in and take my place in trying to get this thing sold. But in the meantime, I'm going to develop another product. So if this guy can't make it happen, we still have a business. And I think the board was very impressed that, okay, you know what? He's getting out of the way. He's not making a big fuss over this thing. He's taking action to start another business within our business just in case. And then when that other business worked out, it was like, hey, you know what? This guy just salvaged the company. And from their perspective, it was salvage their investment because these guys had put a fair amount of money into the business, and like every investor, they wanted a return.

Speaker C: What was the other product that you developed to make sure that the company was still okay?

Speaker B: We developed a computerized product that took in all the data that they record in the sleep lab. Sleep labs were starting to develop back in the mid-80s. People were looking primarily at sleep apnea. So during a sleep recording, they look at eeg, they look at eye movements, muscle activity, they look at respiratory activity, ekg, blood oxygen saturation. Because the major diagnosis that they're looking for is sleep apnea, obstructive sleep apnea. And so they have to be able to document that with all of those different parameters. What we did is we brought all that information in, we recorded it, but we also analyzed it for them because the typical analysis process afterwards was four to six hours of a technician, and we could reduce that to 20 minutes. So we developed a very nice cost savings and time savings device that allowed everybody to keep on schedule and get all the recordings analyzed the next morning. So our product was seen as a big benefit to the sleep labs. And so we right away, in our first year of introducing that product, we outsold what we had sold in the entire operating room, uh, monitor business.

Speaker C: Hey everyone, I'm here with John Austinson. And actually I interviewed John on episode 270, which is a recent one, and further back on episode 250. So if you want to hear more about his story. But I'm here today to talk, uh, about franchise opportunities in 2025 with John. So. So John, why don't you just give us a review of kind of what you do and maybe some exciting opportunities for someone who might want to invest in franchises.

Speaker A: Absolutely, Austin. So yeah, Fran, Bridge Consulting is our company and we guide clients of ours through the, uh, exploration process where they're checking out franchises. We focus on what I call non food franchising. So it's all the industries outside of food that their clients are getting into. And it's entirely free to work with us. We simply get a referral fee from the brands on the back end. So none of that's passed on to our clients. So if anyone's interested in identifying the top 10 or 12 opportunities that are open in their market, uh, that could be a good match, we'd be happy to take them through the process. So, yeah, to give you a little bit of color of what we're seeing out there first, we're seeing more interest than ever before. I really think entrepreneurship's alive and well in the US and we're seeing that across a range of different industries and different types of businesses at different price points, all sorts of backgrounds, getting involved in franchising in new industries. Maybe they're bringing a transferable skill set. But some of the types of opportunities that we're seeing interest in would be things like home and property services, you know, very scalable businesses. Everything from pull out shelving companies for kitchens, um, and pantries, to dumpsters, to restoration and water mitigation, mold remediation, you know, kind of that non sexy space. Ah, certainly, you know, they're remodeling companies and others that might be a little sexier, if you will, but things like pressure washing, it's asphalt paving and line striping. Again, no expectation that you have a background in these. We step into them, you lean into the franchisor and they really support you and teach you and guide you and your team. You know, other industries would include things like health and wellness. So everything from, you know, recovery modalities like, you know, sauna, red light, cold plunge, uh, cryo, you know, all under one roof potentially to Things like fitness and even sunless tanning. There's a great opportunity in that space that uh, you know, it's a nice recurring revenue. Just a great business model that has uh, great earnings. You know, industries like kids or pets or seniors, few examples there in the kids space. Everything from youth soccer to tutoring and stem to trampoline parks, you know, we're always going to spend on our kids. Right. We'll also always spend on our pets. Industries like pet grooming or boarding or training, you know, continue to just thrive out there. Even pet mort, um crematoriums which takes a special individual but there's a business to be had there. All these different types of niches. We see clients of ours getting involved in industries around the senior space. 10,000 people turning 65 every day for many years now and people want to age in place. And so that can be everything from in home health which a uh, lot of our clients have gone into, to other solutions like helping people age in place by providing wheelchair ramps and stairlifts and mobility solutions throughout the home. And so again all these different niches. And I'd say even though there's a diversity of opportunity, some of the general themes that we're seeing out there are understandable cash flowing businesses, you know, things that aren't trying to be the new trend or the new sexiest thing on the block. Instead it's businesses that should stand the test of time. That's really where our clients are getting in and becoming business owners oftentimes for the first time. And some of these opportunities you can be all in invested at ah, 150,000 and then certainly goes up from there. But I'd say 80% of our clients are getting into things at between 150,000 and 300,000 they're able to step into oftentimes utilizing an SBA loan. Banks love lending to franchises. We see that the lending uh, as well as the robs program where they can roll over an old retirement account self directed and purchase the business that way as well. So lots of ways to get involved. All different price points in definitely a variety of industries. And like I said, we're seeing so much interest these days.

Speaker C: Yeah. And just reviewing it sounds like. So you're saying home and property services kind of health and wellness and then we have kids, pets and seniors are kind of those hot trends that you're seeing in 2025.

Speaker A: I ah, wouldn't call them trends, I would call them themes that we're seeing out there because really the theme is what are people going to spend on regardless of the economy. It's the things they care about, their kids, their pets, their aging parents, their homes, their health. That's really where we see most of the interest today.

Speaker C: Well, thank you for kind of giving us that rundown. Someone wanted to book a call with you and if they would be a good investor for a type of franchise that, uh, you can help them find, what's the best way for them to go ahead and reach you.

Speaker A: Yeah, we'd love to engage with them. Come out to our website, franbridge consulting.com, franbridge consulting.com share your email address. We will send you a free downloadable copy of our best selling book, Non Food Franchising. That could be a great primer. And then if you'd like to take the next step and get on a call, we'd be happy to help.

Speaker C: And again, if you want to listen to more about the details of what John's been up to recently, check out episode 270. I imagine because the other product didn't work and it kind of assigned blame to those doctors. Or are you trying to look for a product that would only make things more efficient and helpful? Maybe not assigned blame. It sounds like that also helped.

Speaker B: Yeah, Austin, that's a very good point. You know, I learned from my mistake. We hadn't done a good job of analyzing how the market would view it because we only talked to people who already did monitor brain function. But we didn't realize that the vast majority of people would not be interested. So this time I was looking for something that all the docs in the field would say, yeah, this is a good deal, we definitely need this. So I made sure that the market would buy into it before we even developed it. And in fact, I went to 20 centers around the country and I said, I want you to buy this before this product's even done and then you can have input. And I got 19 of them to buy into it and actually pay us in advance for a product that didn't exist because they wanted it so bad,

Speaker C: then you had the proof of concept by having that as well. I guess if that would have happened with the first one.

Speaker B: Right.

Speaker C: You probably have had any sales if you're doing it with the other instrument that you created.

Speaker B: Exactly, exactly. Everybody would have looked at us and said, you guys are nuts. We really don't want that. And we would have known, I guess

Speaker C: taking it from there. Do you want to expand to where you are now? I mean, I don't know if you want to jump around to other products that you created or worked on that the entrepreneurs can learn from.

Speaker B: I think probably the next thing we did in that business, which actually almost got me fired. Yeah. You know, even though I had developed credibility at this point because the business was salvaged with the new product line. I came into the office with an idea and he wanted to present it to me. And he did. And what it was was a uh, band aid with a piece of plastic glued on top of it. He explained that if you take this band aid with the plastic on top of it and you stuck it to your nose, to both sides, you know, over the top, that it would open up the nasal passages and allow you to breathe easy. And I looked at it and I thought it was one of the most simple, brilliant devices I had ever seen. Without board approval, I went ahead and I licensed it, including giving the guy a uh, stock option as part of the license arrangement. And I even h recruiter to go out and find a uh, big pharma executive to run that division of the company. And then I went to the next board meeting. You know, our board meetings were quarterly. At that point I told them what I had done. Two days later a contingent of the board came into my office at 8 in the morning and said, we think if you like this product so well, you run it, change your search parameters and replace yourself in the existing business. So in other words, what they were saying was if you don't make a success out of this new business, you've already replaced yourself. Because what the hell were you thinking by licensing this nose band aid when here we are, capital equipment, We're a high tech medical equipment business and you've just licensed a consumer product and we don't know anything about manufacturing and marketing a consumer product. So in part I can't blame them. I mean I think that their criticism was valid. But the device, this product concept was so brilliant in my opinion. I just didn't think it would be hard to take it out to market. You know, I had done it.

Speaker C: So what was the name of the product?

Speaker B: Breathe. Right. The breatherite nasal strip. So our plan was really fairly elaborate, but I thought accomplishable because my board was right. We weren't a CPG company, a consumer packaged goods company. We didn't have $50 million in the bank to launch the product. And even when we did start getting it out there and Procter and Gamble saw it, they were interested in the product. And so they had me come to Cincinnati and present to their new business development people. And they were the first people to say, hey, you know what? You can't launch this. You don't have enough money. It costs us $50 million to launch a consumer product. And how are you going to do it with your bank account? I think my board had a legitimate, uh, concern. But what I saw in terms of an opportunity to launch the product, I figured, I think we can struggle and find our way to get distribution. And once we get distribution, I think we can launch it using pr. So we set out to seed the media with press kits so that they would have it. We contacted, they all had our, uh, press kit, and then we introduced the product. After we had 20,000 stores with the product in it, we introduced the product to football players, and sure enough, they started to wear it. And overnight we became a $50 million business. It only cost us about a million dollars to launch the product, not 50 million.

Speaker C: What point in time was this? I don't want to overlook the guy. Can you go more detail about the story about the guy approaching you, knowing how to approach you, and you're talking about licensing and giving him stock. Like, how do you know how to do all this?

Speaker B: Well, I'd already done enough licensing work with our sleep disorders diagnostic products and enough distribution deals, so that wasn't an issue for me. I should drop back, though, and say this, especially for people that are thinking about starting a business. One of the best things we did was to find the right lawyer up front. And we found this guy. His name was Pat Delaney, and he worked at a nice sized legal firm in the Twin Cities where we were based. This guy was invaluable for me because, you know, at the time, I'd say he was in his late 40s. He had a lot of experience with entrepreneurs and new businesses. And this guy was probably my biggest go to guy when I needed advice for one thing or another. He was my advice giver, he was my confidant, and he was probably my biggest supporter, too. He had an older brother who was a, uh, doc. And he always said, I think doctors can be really good business people. And so he had a different viewpoint from the other business guys, particularly the VCs. And that was an incredible help. So Pat Delaney was a huge help. He worked with me when we crafted all our different deals. And so I learned pretty well. And by the time Bruce Johnson, who was the inventor of Breathe Right, came to me, we were already a public company. So we had already gone public. And so I was used to a lot of legal dealings and dealing with investors as well as Board members and other business people at high level. So I had a lot of experience early in the process. So when we cut that deal with Bruce, I mean, doing an option arrangement, a license. License deal, was really no big deal. And Bruce had also retained a very good attorney. It was really four of us sitting in a room, me, Bruce, and each of our attorneys, and we hammered out the deal. It was fairly straightforward because, yeah, I

Speaker C: thought maybe it was just literally your third deal, I guess, because it was the first one that you talked about that, uh, you saw writing on the wall probably wasn't going to work. And then you talked about the second one that actually worked out, made y' all money. Even if it was the third one, I'd be surprised that you'd be able to think that way.

Speaker B: It was our third product line, but it was our. But in the sleep disorders diagnostics, in filling out that product line and doing a lot of deals and international deals for distribution, I mean, there was a lot of legal work that had been done, and we had already been public. We had gone through a number of stock offerings. So from, um, a sophistication standpoint in terms of those kinds of legal maneuvers, I was fairly experienced at that point. And when Bruce came in, we had been in business almost 10 years already, so there was a fair bit of experience. Ah, at that point.

Speaker C: Do you want to talk a little bit more about the growth story there?

Speaker B: I think in the Breathe Right story was an interesting one because it was really setting up. It was setting up for success, believing we were going to be successful. I mean, there was a lot of preparatory work. A lot of people think that that business was successful because football players started wearing it. And then all of a sudden everything happened. That's really not what happened. I mean, it's a feat to get a new product, I mean, a new category of product into the drugstores, for instance.

Speaker C: Talk about that a little bit more. Because even if I look at the competitors, I really don't see any competitors to breathe. Right. Other than the CVS brand or the Walgreens brand.

Speaker B: Right? Yeah, because nobody really made it. And we made it so big that there was no reason for a competitor to really come. And it was just private label. Plus, we launched it and we had patent protection for many, many years, so that kept others out of the market. But getting that distribution was a real feat. I mean, when I took the product on and after we got FDA clearance so that we could actually start selling it, I made a rule inside the company, which was, we are Going to sell this product direct to a consumer. Even if a consumer calls us and we don't have distribution, we're going to force distribution. And again, remember, this was before the Internet was popular. This was before there were good direct means of selling. And what year was it this occurred in 93. Okay, okay. You just don't put it up on Amazon and then people can start ordering it and then you can do direct fulfillment. Okay. That didn't exist. Some of your audience might be saying now, so why should I bother listening? We wouldn't do it, do it the old way. But that's, that's not entirely true. You might start out going direct. It's like I'm going to launch another product that's a consumer product that I'm working on. And I'm not prepared to discuss it yet today, but I'm working on that product and I'm not going to put it at retail first. I will do direct fulfillment, but at some point when I want the brand name to be known, you're damn right I want that thing on the shelf. Why wouldn't I want all of that present to educate the consumer? Because educating the consumer is really an expensive proposition if you're not going to be on the shelf when they're looking for something else.

Speaker C: You know, And I think we can definitely pull about creating another category. What happens A product that does create another category. Because we don't get to hear about the stories a lot. So.

Speaker B: Right. Creating a category was very, very difficult. The first thing I did, because a pharmacy can't order it unless a wholesaler carries, because all your pharmacies order from wholesaler unless they're the big chains. And ultimately they're going to order from you direct because it's cheaper for them to do so. So in the beginning, you have to get all the top wholesalers to carry the product. So I went, visited the top 10 wholesalers in the country and every one of them rejected me. And their rejection was, look, why would we take you on when nobody's calling us to buy it from us? So we're only going to take you on after people start calling. And the big chains weren't interested because their comment was the same thing as, uh, Procter and Gamble. It's like, you think you got any shot at making this a household item? You got to be kidding me. If it happens, we'll be glad to carry it. In the meantime, we're not going to take up shelf space with a product that nobody knows anything about. And so, so the first thing that we had to do was, okay, I have to develop some level of consumer demand, and then I have to force some pharmacies around the country to start taking the product. The first thing I did is I found a startup PR company that I knew I could get a good deal with, and I hired a guy who was going to do nothing but sit by a phone. And the PR company, we struck a deal where I said, look, I'm going to put $25,000 into this bank account, and every time you get me an interview on the radio, you can withdraw 250 bucks. So my 25,000 should get me hundred interviews. And they would get me on radio stations anywhere in the country, and I would talk about it. And then I'd have the consumers call in directly to our company. And the guy I hired, Chris, he manned the phones. He would pick up the phone and he would ask their name and ask who their pharmacy was. And then he would call the pharmacy and he'd say, Mrs. Smith wants to buy this product. And then we would ask the pharmacist who their wholesaler was. We'd call the wholesaler and say, Dr. Jones, the pharmacist here wants to buy this product from you. And we would close the door loop. And we did that thousands of times around the country. And so we literally forced distribution. And that PR company, I ended up paying them $100,000, and they got me on radio 400 times to do that. And after doing that, we were in 20,000 stores.

Speaker C: Whose idea was that? I think that's pretty. Pretty smart way to think about it.

Speaker B: Well, that was my idea, and it was just brute force. I mean, at that point, I couldn't figure out any other way to do it.

Speaker C: Were you just thinking one day, like, maybe this is the way I can connect that loop where you're inspired by something else to.

Speaker B: Well, I was already visiting the wholesalers. I was already talking to pharmacists. And so it was like, what does it take for you to buy this? And so literally was talking to them, and they were saying, well, I'll only do it if this. You know, after being told that you kind of, like, put the pieces together, it's like, all right, if that's the only way I'm going to get this product in, uh, then I'm going to find the customer, the pharmacist, the wholesaler, and I'm going to connect the dots. And it worked.

Speaker C: Why did you need FDA approval for that?

Speaker B: Well, even products that don't require a prescription but they have a. It's really for the medical claim. We wanted to be able to claim. Claim that this will help you breathe more easily, it will help you when you have a cold, it will help you with allergies, and it will help you if you snore. Okay. And so we had to do clinical studies, which we did, and we submitted that to the FDA with the product and all the safety information, and then they approved. So you have to do that so that you can make the medical claim.

Speaker C: And when you're going on the radio, what were you telling the people who were listening to try to get them to understand the category?

Speaker B: Well, I would describe the product and I would read them testimonials and I would explain how it worked. And there were always people that were interested because, look, let's face it, I mean, it was a product that if they bought a box of ten at the local pharmacy, would only cost them five bucks. A lot of people just wanted to buy it from us, but again, we refused because we were trying to force distribution. Force distribution. We were ultimately able to make that happen. The really scary part, I mean, this was probably the scariest part of the whole deal. We had done that. We had also called 700 reporters and gotten them to agree to take the press test kit, not to do a story on it, but just to put it in their file. Because we told them that one day football players would be wearing this and they were going to want to write stories about it. So the scary part was, oh, my God, now we actually have to get football players to wear it. We sent a case to every NFL head trainer, and then the guy who was taking the phone calls from the people that were responding to the radio, uh, interviews, I said, every week you have to contact every NFL head training trainer and convince them to start using this on their football players. And that's when I really started to get nervous because it's like, okay, we really need this to happen, because that's the only way we're going to get enough demand to keep the product on the shelf. You just can't keep doing radio interviews and pull enough product off the shelf that wasn't generating enough traffic. Finally, one day, Herschel Walker came into Otho Davis when he was at the Eagles and said he had a cold and Herschel didn't like to use drugs. And so Otho said, you know, I got the perfect product for you. And these Breathe right nasal strips. And so he put it on Herschel. And Herschel absolutely loved the product. And then as soon as he wore it, he says, you know, if it makes me feel good, this good, when I've got a cold, imagine when I've got a mouth guard in and I'm, um, playing football. This is going to help me breathe better. And so he wore it that Sunday, and fortunately for us, he scored a couple touchdowns. And one of those touchdowns, he was face forward as he was over the goal line. And they got a really nice picture of it from the end zone. And they showed that picture on Monday. And then a beat reporter called us on Wednesday and did a really big story on it that showed up front page of sports section on Friday in Philadelphia Inquirer. And we got copies of that. And then we sent color reprints to all of the NFL trainers. And we said, hey, you know what? Post this in your locker room so that your players can see it, because your players are falling behind. They're not using this great new product that will help them play better. And Jerry Rice saw it m when he was with the 49ers, and he says, hey, you know what? I've got a nasal breathing problem. And so he went to their head trainer, Lindsey McLean, asked for some, and he wore it on Monday Night Football that week. And that was a huge breakthrough for us because, you know, everybody knew Jerry Rice. And the next day, five head trainers called me and said, can you send more product? More of my players want to wear it. You know, this was in the 94 season. By the time we got to the super bowl that year, we had 15 players in the super bowl wearing the product. I sat there with my kids with a stopwatch, and we recorded how many mini minutes of free publicity we got where you could easily see breathe, right? And it turned out to be over six minutes. It would have cost us, uh, $15 million in advertising expense, and we got it for nothing. And we had not paid one of those players to wear it.

Speaker C: You're not kidding. I just googled Herschel Walker nasal strip. There's all these articles from even the mid-90s about y' all blowing up, right? From exactly what you're saying. And we're going to put those in the show notes so we can take a look. But, yeah, no, that's amazing. What happened with the sales right after that?

Speaker B: Uh, well, we went from a very low level to an annual run rate of 60 million. We had so many orders that we couldn't fulfill them. We could fulfill right away about seven and a half million dollars worth of orders. And even that I had to fight for to have that much inventory because nobody in our company believed we would sell it. And we had orders right away for $15 million worth. And then there was just huge consumer demand. So the product took off right away. And I went to give one company some credit. Procter and Gamble, they were really quite honorable. After that took off, they called us up and they said, congratulations, you just rewrote the textbooks on how to introduce a consumer product. Because literally we launched it with a million dollars worth of costs. And they were so used to spending $50 million every time they launched a new product.

Speaker C: That's pretty amazing. So what happened from there? So were you just ahead of the breathe right strip guy, or were you one of their products?

Speaker B: I was still the chairman and CEO of the company, but I was running the breath right business. But we did well that year. In 95, we did about 60 million in business. In 96, we did 85 million in business. But here was the problem. In 85, our domestic sales were flat. I'm sorry, 96. 96 versus 95, they were flat at 60 million. Uh, the additional 25 million. 96 came from international sales. We had done a deal with 3M and 3M started to get the product out in these other countries. And so I went to my board. I did have a president who was running operations at that point. And we had hired a consumer marketing guy. But I took each of my board members out separately at the end of 96. And I said, you know, we got a problem. We don't know how to manage this consumer product like a real consumer packaged goods company. We need a significant change in our staff. And they looked at me and they said, you know, you've just grown from 60 million in 95 to 85 million. The optics of replacing your staff right now are just insane. And I said, I don't care. I said, we don't have the right people in the right place to do this, and we're going to falter as a board. They would not let me make that wholesale substitution or even replace much of anyone. So in 97 we dropped. In 98 we dropped further. I finally got them by the end of 97, beginning of 98, to say, okay, go ahead and execute your plan. I basically had to transition the staff. And fortunately we have a number of consumer packaged goods company here in the Twin Cities. So I could find, uh, a host of really good people from them, particularly General Mills. I brought on some new people and they resurrected the brand at that point. So they saved it. But one of the things I did in 96, while things were still going really well. I mean, imagine 96 where companies climbing to an $85 million year. We're public already, so the stock's doing well. We had $25 million in the bank, and we're operating exceedingly profitably, so we didn't need any money. So what I did was I said, okay, let's do another offering. And at first my board looked at me and said, what, are you nuts? We got $25 million in the bank. Why do we need to go out and sell more stock? And I said, well, we got $25 million in the bank. What if we have a downturn? That's $25 million may not be enough to support our efforts. And I said, anyway, look, the stock's at an all time high. Why not take advantage of that and load up on cash? In the end, there's really only two great times to do significant stock offerings. One is when you've got BL and you're essentially overvalued. The other is when you've already made it and you're at the front end of that big success where people are willing to give you a premium. We did an offering, we raised an additional $35 million, and so that gave us $60 million. And I'll have you know that there was a point in about the year 2000 when we only had $18 million in the bank. We needed all of that money to fully resurrect the brand.

Speaker C: You mentioned Twin Cities a couple times. If people don't know or they're listening to Internet nationally in Minneapolis, Minnesota, correct?

Speaker B: Yeah.

Speaker C: Okay.

Speaker B: Yeah.

Speaker C: And is that where you're out of today?

Speaker B: Yes.

Speaker C: And you were talking about in 98, they let you start implementing your plan. What did you see in the people that you knew you had to switch people in order to, I guess, keep growing.

Speaker B: They didn't have a consumer packaged goods background, and they didn't realize all the fundamental parts of the equation that needed to be dealt with in order to effectively drive brand awareness and sales. And particularly what we were really interested in is repeat use. I mean, we had a number of applications for the product in terms of how it could be used, but we didn't fundamentally understand what was driving the business and what was driving profit. And so we didn't have enough market research to really understand it. And therefore, our advertising tactic weren't geared towards the aspects of the consumer that would fuel regular repeat usage. For the best application. It turns out the best application was a better night's sleep. And so those people that were using it every night, they were the key people. And we weren't even making that claim. And we only understood that after we did enough market research to truly get down to the bottom of it. And that's why we needed the right people in the right places to carry the business forward.

Speaker C: So, uh, are you still with the CNS today?

Speaker B: No, we sold CNS in 2006. That was an interesting process as well. In 2005. Well, in 2003, actually. Now that we had professionalized the company, the good news was we brought the right people in to resurrect the brand and to move it forward. The problem was I now had a group that made it impossible to launch new products. Fortunately, before they came on, we had launched another consumer product called Fibre Choice Chewable Fiber Tablet. And that ultimately did well too with the new group. But after the new group was established and I was running the new products division, so I was evaluating new products and recognition, recommending that we take a look at this and that we try to launch that. These people were so professional that all they could do was find the negative. They never wanted to take any risk. So in 2004, I proposed to the board that with our current staff, if we cannot launch a new product by the end of 2005, that we sell the business because our shareholders deserved it. There's no sense in holding a business if we weren't going to be able to to launch new products and grow the business with new products. And we clearly with the group we had. So it was my challenge to them. I said, look, you got 18 months. If you can't agree to launch a new product by then, then we're going to sell the business. And I had the board vote on it and that resolution was passed. And then by the time 2006 started and we hadn't signed up a new product to be launched, we set out to sell the business, sold the business.

Speaker C: And then did you just thought you were going to retire or what?

Speaker B: I had already gotten involved in some other projects. I had plenty of stuff to keep me busy with, but I just couldn't see maintaining this business. So we hired the kind of investment banker who goes out and finds other companies that are good fits. And we had a number of companies bidding on the company and at the end of the day, we sold it for $566 million, the GlaxoSmithKline.

Speaker C: And did you have equity?

Speaker B: Oh, yeah, yeah, I had a lot of equity. Uh, still, I mean, not A majority. Nothing close, but enough where if I wanted to retire, I could have retired.

Speaker C: What kept me going then?

Speaker B: I had started another project. I had always had an interest in alternative healing methodologies. I had seen a lot as a physician and I had read a lot that told me that there were a lot of things that could be done in medicine that weren't being done because people didn't understand them very well and they were hard to understand and there wasn't technology to measure all of these things, but yet the results could be had. And so I started working on synchronized sound, vibration and magnetic field therapy, basically to induce very deep states of relaxation and meditation and that what we saw would also induce healing states. But I didn't want to turn it into a medical product because the fda, FDA is tough to deal with on these kinds of alternative care products. So I was really mostly interested in doing these things to further my own understanding and offer it to people who were interested in medicine. Meditation. And that product is available now. It's called the Soltec Lounge S O L T E c. So@soltechlounge.com you can actually see that product. We've continued to do interesting research in that area. We've made a number of fundamental discoveries that we're not talking about yet because we're still doing the research in order to be able to file all the necessary patents. I mean, some of the stuff we found is really spectacular, but it's so weird and it involves so much study. It's so different from the way you think about medicine and how the body and the brain work that we need enough research to quantify what we're doing in order to file patents that are going to hold up international.

Speaker C: And can you just give us an idea of, uh, how were you even able to come up with this concept and what it does in general?

Speaker B: Well, people had already developed a bunch of chairs, tables that did sound and vibration that is relaxing, don't get me wrong. But that's a very limited view as to how things really work. I mean, I'm sure you've heard the term Austin, mind, body, spirit. Right. Well, you know what your mind is, at least you think you know what your mind is, you know what your body is. But if I said define spirit, you'd go, oh, uh, I don't know. That's kind of hard to do. I mean, could you, could you define spirit?

Speaker C: Me personally, I don't think I can, but I'm open minded and I kind of understand the concept, but it's kind of Hard to define. I've read some books on it. But definitely, I feel like you probably have a better definition than I could ever give.

Speaker B: Well, you know, but look, it's really tough. I mean, and the reason it's tough is because we don't have any scientific instruments that really measure spirit. Some people can experience it better than others. Some people have certain receptive gift or perceptive gifts that come via spirit. And they can see auras and chakras and things like that, and I believe them and so that they can visualize them. But that's not a diagnostic test. As a physician, I can tell you that physicians in general don't like dealing with this. There's a well known disorder called narcolepsy. Have you ever heard of narcolepsy?

Speaker C: Yes.

Speaker B: Yeah, it's a sleep disorder. And people have sleep attacks. They fall asleep very quickly, very rapidly. When they initially fall asleep, they move right into dream sleep versus the rest of us that wait 90 minutes. Uh, they also have a condition called cataplexy, where with strong emotion, they have a reduction in muscle tone. It can be generalized or diffused. And they also have a. What's called sleep paralysis, which is if they wake up out of a dream, they can't move for about 90 seconds. Okay? They're paralyzed. And it's just because part of their nervous system, this little nucleus in the brain stem, stays active and it inhibits outflow of their motor neuron. You know, that's how narcolepsy is defined. But the truth of the matter is, if you go into a narcolepsy support group meeting before the doctor walks in, they're not talking about that. They're all talking about their out of body experiences. Okay? And you go, wait a minute, what the hell is that? What do you mean out of body experience? And if you talk to a narcoleptic about it and you say, tell me about your first out of body experience, they all tell you the same thing. I mean, it's very, very consistent. They'll all say, hey, you know what? I woke up out of a dream and I was paralyzed. And I got up, put my body, body didn't. And I found myself at the top of my ceiling looking down on my body. And so my question to them would be, what do you mean by I? What do you mean? I was up at the ceiling. And then they go, you know, they're surprised and they're shocked and go, oh my God, I'm not my body. I'm, um. That thing, that energy that was up at the ceiling. Now, other people have out of body experiences too. You could equate them also to near death experiences. And so what is that thing that is not of the body, but yet they identify with as that thing as their mind, that that's what they're thinking. So it's an energy structure, it's not part of the physical system. Okay, follow me so far. So my thinking is, well, okay, if that's our mind and it operates through the brain, and I'm a neurologist and the brain's electromagnetic and electrochemical, then this thing, I'm not saying that thing that is out of the body is electromagnetic, but at least it has to be able to interact that way. So if it interacts that way, then we can interact with it. Magnet. And so if we provide synchronized sound and vibration to stimulate the nervous system and the same magnetic frequencies to stimulate whatever that thing is that moves out, I'll just call it spirit for now, then maybe we can better integrate mind, body, spirit, because maybe we're not so well integrated as a number of people have told me that know these kinds of things. And sure enough, what we found is that we can integrate people much, much better. And that has a substantial impact on the level of stress, relaxation, meditation and health in general. So that's the kind of thing that I've been working on.

Speaker C: Now I am here with John Austin again, and if you didn't know by now, he's our first repeat guest on the podcast. So you know, he's a special guy. Uh, John, why don't you tell us a little bit about what you do and how you might be able to help our listeners.

Speaker A: Yeah. At Franbridge Consulting, it's Inc 5000 businesswoman we built up. And that's because we've been able to help so many clients step into business ownership, oftentimes for the first time or in some cases the second or third time. And we focus in an area that I've dubbed non food franchising. You know, with that again, we help people with all different types of backgrounds step into business ownership all around North America. And uh, you know, they get the support of the franchise system. We help educate them along the way. And the beauty of this model is, Austin, it's entirely free to work with us. We simply get a referral from the brand on the back end. None of that's passed on to our clients. You know, we've been able to help quite a few of your listeners in the past and would love to help even more.

Speaker C: Can you give Us like a timeline of how this process might work when working with you to find a franchise.

Speaker A: Yeah, we try to keep it as efficient as possible. And just like everything in franchising, there's a defined process of how we go about it and how the franchisors would engage with you. And our goal is to identify the top 10 or 12 opportunities for you in your market, uh, you know, that are, are available. And so it would start out with an introductory call with us, again entirely free. Uh, we'd get to know you, have you fill out just some very simple paperwork to get a little bit more of a profile and then we'd go to work on our end to identify uh, based on our relationships, based on what we're seeing out there and our past experience. What are those top, let's call it a dozen opportunities in your market would come back then and present those to you. Uh, you would try to narrow this down to maybe three or four to then have a conversation with that. We would tee up, up and from there the franchisor will take you through a series of calls and presentations, really exposing you to the business. And um, you'll get to talk to other owners in the system and hear about their experience. You'll get to read through their fdd, their franchise disclosure document, where they share all their historical results and information. Again trying to get you as much data and info as possible leading up to what's called a discovery Day. I'd say typically that's around 45 to 60 days, days out from when you have that first call. We do have some people that will move faster or slower, but usually it's around that two month mark and that's where they would fly you into their home office. Spend a day or two with the franchisor and their team and you know, make sure you get your questions answered but also make sure it's a good culture fit. You know, franchising is a partnership and again we want you to go in eyes wide open and really feel confident uh, when you go to sign that franchise agreement. And it's not that you're launching the business right after that. You know, typically there's site selection, if it's physical retail, customer facing build out that takes a little bit of time or in a lot of cases our clients are getting into service based businesses that don't require a physical location. But still there's going to be some degree of training and prep work that the franchisor would help you with to launch that business, you know, shortly thereafter. As far as how do you find the right franchise? Again, you can do a lot of googling. The problem is there's, there's so much noise out there. Even the top 100 franchise list or top 50 list from different publications, usually companies are paying to be on that list. And so it's just a PR move for them. So again, so much noise. It's important to understand what's going on, you know, behind the scenes. What is that leadership team, what is their background, what do they bring to the table, how do they support uh, their owners? And again that's based on our rich history and what I call non food franchising, all these other industries. We can help our clients really understand, you know, what are those opportunities that if we were in their shoes, we would want to be considering there in their market.

Speaker C: And you said 45 to 60 days is kind of most people take to make a decision and they might go out to a franchise wherever they're located. But after that, what would you say? What would be a typical timeline finally putting up money to close on a franchise? Are we talking about like six months from now after that? Or like give us a time frame so everyone can listen and kind of understand that?

Speaker A: Uh, yeah, to level set I'd say most of the opportunities our clients are getting into are between 100, 150,000 and 300,000 from an all in investment range, including working capital, certainly some on either side of that. But a lot of our clients are using SBA loans and so it does take a little bit of time, uh, for that money to hit. Some will use an old retirement plan and roll that over through what's called the Robs program, which is kind of a neat way to purchase as well. So we work with our clients on that funding strategy. What I see most often is at that, let's call it 60 day mark where you're ready to move forward and you're signing the agreement. You're usually paying a deposit while you're, let's say while your loan or your retirement funds roll over. You've already had confirmation that's going to happen, but it may take a few more weeks or even a month after that. But no, it's again process driven. Banks love lending to franchises as you might imagine. And uh, we've got great partners that help our clients with every piece of that.

Speaker C: You said you kind of help identify what market. Say if I'm in Jacksonville, Florida or you're in Atlanta or someone's in New York. If it's oversaturated, you can, can help us figure that out.

Speaker A: Yeah, so I'd say we fly at 30,000ft where we're saying, hey, here in comparable markets, here's how the franchisor is done. I'd say the franchisor flies, you know, much closer to the ground where they would take you through uh, using their technology to identify the demographic information at the zip code level. So average household income, you know, number of addressable businesses with these characteristics. That gets really detailed. But then I encourage our clients to actually take another step once they're serious about a business. How about you do a little bit of secret shopping? How about you call around? How about you get some quotes? How about you go out and visit the competition? You know, I'd say if there's a competition that could be an indicator that it's a good thing. There's a need for that service in the market. However, again, yeah, you want to make sure you're not saturated. You also want to make sure what is your competitive advantage against that competition. So there is some science and some art to this and we come alongside to try to hold their hand through the process. Come out to our website, franbridge consulting.com Fran Bridge consulting.com and uh, share your email address. We'll send you a free downloadable copy of our book, both audio as well as PDF. Uh Non food franchising is the title. It's best selling book. Would love to share a free copy of that with you and then if you'd like to take a next step let us know uh, in the email that we reach out to you with and uh, would be happy to get on a call. Again it's entirely free to work with us. We're essentially a real estate broker but for franchises.

Speaker C: Well, thank you for sponsoring the podcast and thank you for giving us some insights here on franchising. Do you ever pinch yourself when you're working on this like how you got into it and you familiar with the, how you say untethered soul? You know about that book or.

Speaker B: No, I haven't read that book but I've read a number of books. Probably like it, right?

Speaker C: Yeah, yeah, I imagine so. Yeah. I'm very open minded and once you start looking more into it, to me it almost gets scary that I'm reading more and more into and trying to understand, understand it. The spirit part I guess that you're talking about but how you kind of got more into it because uh, at first when you even you bring up spirit, I guess some people just kind of look at you and think it might be kind of crazy to extent like I don't know if that's just me or if you've had that happen to you while you're talking about this type of ordeal.

Speaker B: Well, I have the good fortune of having been very successful in business and I've continued to be successful in business with other boards of other companies. And so it's like, look, you can call me crazy, but you know, uh, I think a lot of people would like to be crazy like me. Right?

Speaker C: Selling a business for 500 million. Yeah, I think so.

Speaker B: And the other thing I would tell you is there's 3 million narcoleptics in the world. Are you going to call all these people liars? I'm not. And when I sit and talk with them, I think they're telling me the truth. I believe them.

Speaker C: I think maybe a couple hundred years from now, or even 100 years from now, how much we advance where people accept certain things. Right, right. It's just going to take time for people more open minded. So I don't know. Do you see that happening somewhat sooner?

Speaker B: I do. Uh, and I'm dedicated, indicating, you know, I'm probably going to make an awful lot of money with this Soltec Lounge. When we come out with what we're doing with this thing in another year or so this thing's going to probably become very popular and I wouldn't be surprised if it's going to become a multi billion dollar company. And I own a lot of this company because I've been the major investor and I'm going to dedicate all of that money to a diagnostic project to actually be able to measure the spiritual. Okay. Because I think it can be done. I think it can be done with the scientific instructions we have available to us right now. It's very expensive stuff, but I think that's what we can use to research this. And I think this can become something that can be demonstrated in that way. And then I think everybody will have to look at it and say, well, you know what, I can't argue with what's being measured. It must be true. That's the contribution I would love to make to our society.

Speaker C: Yeah. One of my interviews was actually with a guy who started one of the portable float tank that you can actually do in your house. I don't think he even touched on the spiritual side really, but you know, just the kind of Zen feeling you have. But he even says how much his company's taken off. I think it's kind of more of a hybrid in between maybe what you're working on and he's done. So and how much that's come, like, okay. Like people kind of get it. Like, even if you just use it as a relaxation thing, if you're not thinking through it at all. But he's taking off like wildfire as far as being able to sell that. That there's different places that you can actually go into a retail place, get in one of the tanks. So could easily see that obviously happen. They think people, uh. What's the website again? So they could go look at what you're talking about. About that you're working on now.

Speaker B: It's thesoltechlounge.com yeah, just google soltechlounge s o l t e c lounge.com and you'll find the site. You get a better idea about it. If you want to read more about the kind of stuff I'm talking about and doing, I've written a book that covers this kind of stuff in more detail. It's called Addicted to My Ego.

Speaker C: So what's been the best part about everything that you've done?

Speaker B: I think the best part is just having passion about what you're doing and being engaged thoroughly. And it's not about the money, it's about loving what you're doing. And that becomes really infectious. And then what happens is you end up recruiting people that are similarly passionate. And the relationships that you form are incredibly gratifying. And it just makes for such a much more enjoyable life. So to me, it's find something that you love to do and do that. Then you're much more likely to be on your life path, which will be much more gratifying than if you're doing something you think you should do or other people think you should do.

Speaker C: Yeah, no, I think that's really important part that, uh, you know, leaving us with those kind of like, words of wisdom there. I mean, we didn't get a chance to talk about it. I think I said briefly, was there anything else that you wanted to talk about if you have a few more minutes?

Speaker B: A lot of people that are in the business world operate from their head. It's all about thinking and what I've learned in all of these projects that you're much more likely to be successful if you also learn how to feel. Because when you're feeling, nature gets better and better. Instead of thinking, you start to experience knowing. Knowing is a felt sense, not a thought sense. Knowing is not something you develop by thinking. It's something where everything just feels right and I know the path I'm supposed to be on or I know the right decision. And so if you can be making your decision from that knowing sense as opposed to, opposed to thinking, the odds of you being correct are way, way better.

Speaker C: Thank you again for joining us. What's the best way if someone wanted to say thank you for doing the interview, what's the best way for them to reach you?

Speaker B: Yeah, I think the email is probably the best. It's D Cohen. So D C O H E N AT I'll just say it and then I'll spell it. Toolstowawaken.com so it's T O O L S T O A W a k e n toolstowawaken.com well, thank you very

Speaker C: much for joining us.

Speaker B: Thank you, Austin.

Speaker C: Hope you enjoyed that episode. If you want to catch up with Dan Cohen and see how his business has changed over the last three years, then check out group call 11. And again, that's available only for Patreon members. And to become one, just go to millionaire-interviews.com patreon or check your episode notes below. Thanks again for for listening.