Michael Cammarata is the CEO of Neptunes Wellness Solutions which is a publicly-traded company around health and wellness products with a valuation north of half a billion. Prior to this Cammarata cofounded Schmidt Naturals which he sold to Unilever. Despite dyslexia, he made his first $1M at 13 and was making over $100M by age 20.
In this episode you will learn:
- Mike’s revenue-focused approach to building companies
- The 3 things you need to be able to scale successfully
- The 30-minute meeting that changed his mind about corporate buyers
- How to transform your passion into a million-dollar business
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About Michael Cammarata:
For most of his life, Michael Cammarata has been growing businesses, building brands and disrupting the consumer experience. Inspired in his own life to make health improvements and conscious environmental changes, Michael Cammarata is channeling his passion for bettering the livelihood of the human race.
Michael Cammarata was born with a keen business sense and entrepreneurial spirit. He made his first million at the ripe age of 13 and later translated that prodigy into a variety of other sectors including biotechnology, advertising, electronics and entertainment.
By injecting his enthusiasm for the natural product industry into the brand, Michael Cammarata has elevated its positioning as the “New Face of Natural” alongside heavyweights like P&G and Unilever. Committed to raising the bar for the industry, Schmidt’s is making good on the company’s mission to change the way people think about natural. And to Michael Cammarata, innovation is everything.
Michael Cammarata is currently the CEO of Neptune Wellness Solutions which is a long-running brand regarded for setting the gold standard in extraction, and with plenty of enviable IP.
Previously he cofounded Schmidt Naturals which is sold to Unilever.
Connect with Michael Cammarata:
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FULL TRANSCRIPTION OF THE INTERVIEW:
Alejandro: Alrighty. Hello and welcome everyone to the DealMakers show. Today, we have a guest who is going to be really exciting here because I think that his journey is pretty broad. He’s done everything from advertising to natural products; you name it and starting at the age of 13. So, quite a long journey already at his age. So, without further ado, I’d like to welcome our guest today, Michael Cammarata. Welcome to the show today.
Michael Cammarata: Thank you for having me.
Alejandro: Originally born in Long Island. How was life growing up there?
Michael Cammarata: It was really good. I was on the swim team in Cold Spring Harbor, and I was doing pretty good. I enjoyed it a lot.
Alejandro: Very nice. I like Long Island, especially on the weekends getting out of New York City which gets really terrible in the summer.
Michael Cammarata: I didn’t realize that it actually gets hotter than Florida in New York until a couple of days ago.
Alejandro: It’s unbelievable. Tell me then, how was life there and at what point you got involved with the games. Tell us a little bit about that.
Michael Cammarata: When I was in New York, I was really focusing on sports and specifically swimming. I was highly dyslexic, so definitely, education was not my favorite part. When I was younger, my dad also had a place in Orlando, Florida, and I ended up getting sent there. That’s when I met guys named Jeff Barrett and Clint White who were telling me about a game called StarCraft, and I needed a computer. I was really more into sports. Then I decided one summer, I was like, “Dad, I want a computer, and these guys are going to set it up, and we’re going to play a game.” From there, it turned into 80 hours a week. In my situation, playing a game was very valuable.
Alejandro: I want to follow-up in that, but just one quick question here because I see a lot of entrepreneurs that are really successful that also had dyslexia. Why would you say that’s the case?
Michael Cammarata: I think it just makes you grow up pretty quickly. You definitely have to find your confidence a little bit earlier. You see things a little bit differently, and you explain things differently. From the very beginning, you know you’re different, and then it just gets more and more. It’s like you have to be able to harness it. I think if you do it correctly, that builds some skills that become very valuable in business.
Alejandro: For the people that are listening, so that they get an idea or a visual of what it was like to have dyslexia, what was that experience for you?
Michael Cammarata: In the beginning when I was a kid, I was really insecure. It’s like when you’re a kid, and you’re trying to learn how to read with all the other kids, and you can’t do it that way. You try to do a math formula, and you try to do it the way they’re telling you, but you can’t get to the answer that way. Then eventually you figure out it’s like, “Wait a second. What is the question they’re asking me?” Then answer that question. You may not be able to use the same formulas. You may actually have to build your own formulas in math to do it, but it’s really the confidence. It’s like you get your confidence destroyed off the bat because you learn differently, probably by people talking to people than written format. I think that’s the area, and I think it has a lot to do when you used to be able to learn by communications, and then when the paper mills came and started making books, books are not exactly the best thing probably for people with ADHD or dyslexia to learn. I think it requires time, but it’s really about building that confidence because in the beginning of school, it destroys your confidence, and you have to build it. Then you’re really able to take that knowledge and apply it to a lot of things.
Alejandro: Absolutely. I guess entrepreneurship, as well, if you’re not able to believe in yourself, why would others believe in you. Right?
Michael Cammarata: Yeah. It gives you that drive too. You see things completely different. I didn’t realize how unique I was until I was in an organization with 160,000 people. Then you start realizing, “Okay.”
Alejandro: Yeah, absolutely. Let’s fast-forward here, and to the moment that you developed this love for gaming, and especially StarCraft. You started to think about a way to monetize that. What was that process like for you?
Michael Cammarata: StarCraft was when I started to get my confidence. I got really good at it. I put a lot of time and effort into it. I got into a gaming group, a club. It was one of the top clubs. There used to be a thing called Battlenet. I was one of the top-rank players on it. From there, my curiosity was like, “I want to learn how to make a website.” So, some of the people in the group taught me how to build websites. I asked a thousand questions. Then I wanted my own server. I got my own server, and I said, “Build another website.” Websites started becoming popular. The real-time when it turned into making natural income was when I had a server built that let’s say my brother was helping me fund because I caught him doing something my dad would kill him for when he was in college. We made a trade for a puppy and $2,000. I got my server. Then my dad found out about it because my brother didn’t give me the puppy. We had an argument, and the next thing you know, my dad’s like, “What are you spending all this money on?” He flipped out. Then I was like, “Five million people a day go into my websites.” He’s like, “Well, it sounds like you need to learn how to monetize that.” That’s when I had to learn how to monetize it to be able to pay for my server bill. Then I was very lucky – right time, right place, right abilities, and collaborations, and we made a very successful hosting company.
Alejandro: What year was this?
Michael Cammarata: I started making websites when I was 11, 12, and 13 was when I had my first exit. So, 12 1/2 or 13 years old. I’m 33 now.
Alejandro: Wow. Back then, there were not as many users as today on the web, so 5 million people, that’s quite significant.
Michael Cammarata: It was huge. We had over 10,000 hosting accounts. My web hosting company had over 10,000 hosting accounts, which were primarily promoted by my gaming websites. I would make a website where people can share different mods of games or files and a website that people can communicate on. They’re like fan sites for gamers.
Michael Cammarata: Then, actually, some of the sites, there’s one called Gaming MB, which actually became part of GameSpy back in the day. It was like a cool time. Back then, in web hosting, you could make a lot of money. Now, you can pay like GoDaddy a couple of bucks a month, but they used to cost like $200 or $300 for that. So, it was a very successful hosting business, and we automated it because we didn’t have the money to pay for a whole bunch of staff initially.
Alejandro: I think I heard that this was when you made your first million. Is that right?
Michael Cammarata: I was very successful at a young age. Looking back at it now, and seeing things, it was right at the merge of an industry, and it was cool because it launched me into a couple of different industries right off the bat. Thanks to my brother’s seed capital, it wasn’t that expensive to start initially. But web hosting – think about that. Ten thousand counts paying like $100 a month is not a bad amount. Having all these investment funds are like, “We want to buy accounts.” I want my servers. I worked so hard to get those servers, and I was not going to give them up. So, they got the hosting accounts when I sold those, and I had the servers, but I also had a whole bunch of contracts because I was promoting the web hosting company by giving people big websites and free hosting in exchange for all the advertising rights.
Alejandro: Then, why did you sell this business? It seemed like a really nice income stream for a 13-year-old.
Michael Cammarata: I wanted to get more into online advertising, so I had downloadable applications and programs I made, pop-up blockers. It was more on the lines I wasn’t seeking to sell it. A group of investors wanted to buy it, but I saw dedicated servers starting to come into the market, and I was primarily shared hosting. So, people wanted to buy the shared hosting accounts. I thought that was a good idea because dedicated servers, which is ultimately the reason why you can pay like $9 a month now, or $2 is because people get their own servers and sell the space off of it. So, you’re really selling dedicated servers is competing with the shared-host in space. Shared hosting meaning like you have a server, and then you sell a lot of different accounts. A lot of people use the same server. So, you’re reselling that server hundreds of times. But people start selling servers to people, who then started giving space to their friends, and then that’s what started bringing down. And now, with the Cloud – it was actually part of the smartest business decision I didn’t realize I was doing at the time. So, in hindsight, it was really good timing. Then the online advertising business was before the ID and all that. It was right at the beginning of it. It allowed me to launch the web hosting company to Alan Advertising because they had all the contracts. At one point, I had built a thing called UltraBoard. It’s a messaging board system that Counter-Strike was using back in the day and on their site. So, I had software and a lot of things I was building, and I just kept building. I wasn’t really thinking about the financial part at that point. I just wanted to make sure I could fund the different software, and hire people. Then over time, it became quite the business.
Alejandro: So then, you sell this web hosting business that came as a result of your love for StarCraft. Then you go into advertising and do online advertising. Tell us about this part of your journey. You were like 14 or 15 or how old were you when you were building this up?
Michael Cammarata: Well, I had the advertising rights. I just wasn’t monetizing them at that time. I was just promoting the hosting company. Then when I got out of the hosting business, and I had all these advertising contracts, I’m like, “What do I do with them?” What I ended up doing, my dad introduced me to a group in New York called C I Sales. They’re Cox-interactive. They sell the online advertising rights to Cox Communication, and they sold like local radio. That was my first sales team. Then they started selling the inventory on these sites, and I very quickly realized that the advertising business was emerging, and then that became pretty big. At one point in my network, we were up to 150 million uniques per month, which is huge at that time on the web. That was when I was 17 years old. We were providing other ad networks. I think my specialty there was being able to sell to networks who sold to people, to advertisers as well as being able to sell directly to advertisers. That’s when we started making software for people like pop-up blockers and a lot of the stuff that people probably got annoyed by back in the day. It was a very successful business in advertising. That’s when I started building companies to market on our advertising network.
Alejandro: Got it. Just out of curiosity, what were you pulling in at 15? What were you bringing in, in terms of income when you were 15 that year, for example?
Michael Cammarata: I guess the best way to calculate it is that I was generating, looking back at it, my accountants were quite amazed at it because I was generating between 17 to say early 20s, I was generating like over 100+ million dollars.
Michael Cammarata: But keep in mind, the web hosting was a vehicle that actually got me to learn how to invest in companies. It got me to learn how to build companies because I started knowing that as – the shared hosting was starting to diminish. You used to be able to charge like $500 or $200 or $100 per month per account. As dedicated servers became popular, the shared hosting became less popular. Then in online advertising, we were signing web hosting contracts where it was like “I own all the online advertising rights, and I’ll give you a 20% commission of what I sell, and I may throw in free web hosting for you.” Then by the time I was 17, it was more along the lines of the publishers of the websites getting 80% of the contract, and they give you 20% of the commission, and they want free web hosting as well. So, the margins were starting to shrink. There were a lot of acquisitions. So, the thing was, I was like, “Okay. My margins are shrinking, the competition” – everybody wanted to be an ad network now. Everybody wanted to be a hosting company. So, the pivot I had to make was like how do I start building things so I can then be my own advertiser? That was the basis premises when I was 17. That’s when I started investing in different companies and building companies. That’s when I learned about due diligence, and probably started getting a good accounting team and a good legal team around me because the first wave of it was probably not the best. I think that’s the part where I really started to learn, and that’s where Random Occurrence was founded. That’s really where I started getting the most business-savvy. Before, it was like how do I make – I was making money to build servers to use for my gaming. It was like a collaboration. Then I started realizing over time, if you don’t continue to adapt your business model, your margins start to shrink. Ultimately where the biggest pivot was is starting out investing to be able to invest in other companies. I started learning a lot from investing companies and made some mistakes. At that point, it’s where it all came together. So, that’s when I started focusing on the business attribute of it and the due diligence and investing and understanding corporate structures. Then at 24, I had always wanted to manage a Rock band, and I ended up managing a Pop band and getting into that in the entertainment industry. That’s really where I learned that – the first couple companies I started were service-based businesses, and service-based businesses over time, the margin shrinks, and you have to offer more services to your customers. That’s when I made the pivot into brands and products. If you put the effort into building a brand, and the brand has a purpose and meaning, and it can help. The simple thing was how do we get aluminum-free deodorants. That’s how I got into the product world and started building the brands.
Alejandro: Michael, we’ll get to that in just a little bit, but to just finalize and wrap-up the phase with the online advertising. I’m sure that the listeners are probably in shock. When you were bringing in 100 million between 17 to 21, did you have a team around you, or what did the operation look like?
Michael Cammarata: I wasn’t focusing on the growth in revenue. I was more along the lines of how do I be the biggest ad network? I was more in being in competition, like trying to focus on that. Did we have employees come to different employees? Our first handful of employees were people I played video games with when I was – actually, to this day, my CTO of Schmidt’s now, was helping me with my web hosting business when I was 12 years old. So, I’ve had a lot of great employees that have come over the years, but again, it’s like the accountants and stuff on those lines, and investments, it’s like you start making deals. At that point and time, I was just about making deals and expanding. We were doing it like a group of friends. I don’t know what the exact calculations were on that, but I know people nowadays are like, “Wow. You did all that.” I honestly wasn’t focusing on the topline. I wasn’t focusing on that. I was focusing on innovation. I wanted to have the coolest servers. I wanted to have the best technology. I wanted to have the best environment mainly because I also wanted to use it. So, I was building products for myself, and we were monetizing. Then back then, online advertising was a huge market like $10, $20 a CPM. When you have 150 million uniques, you’re doing good. Now, keep in mind, when we started, the margins were 20% to publish your website and 80% to the ad network. Very quickly, that changed to 80% to the publisher and 20% to the ad network. Now, it’s probably even less.
Alejandro: At the peak, Michael, how many people were helping you?
Michael Cammarata: I don’t even keep track in my head, but like probably now we have over 50+ that are deployed overseeing probably a couple of hundred companies. So, it’s like in my family office.
Michael Cammarata: It’s definitely been something that – that was the biggest key that we did well in the web hosting company is like six people managing 10,000 accounts. The only reason we did that was because we automated the software. So, we didn’t have to have somebody mainly set up each person’s account when they ordered a web hosting account. We automated so that as soon as they put in the credit card information, they validated their information, then it automatically set up the account. That was probably what allowed us to be that successful because the web hosting companies on average had a couple of hundred people, and we had like maybe a max in web hosting like 15 people. In online advertising, we had Cox Communication helping sell. I had an internal team of probably 30-some people that were helping sell the online advertising. We had software developers. We had partnerships. I think the biggest thing that I learned is collaborating with others. If you try and take all the revenue yourself, or you try and build something all by yourself, you’re not going to be successful. That’s where you start to realize to be able to scale, you have to be able to have the right partnerships, the right employees, and the right technology.
Alejandro: Got it. Whatever happened with the online advertising operation? Did you guys sell that or what happened?
Michael Cammarata: Some parts of it we sold assets on it, and some of the contracts. So, we started selling out different contracts. We would have one of the biggest websites in the world. Once upon a time, we had AdCritic.com and stuff along those lines, which actually became part of Ad Age. Then we had gaming sites that became part of GameSpy, which now became part of IGN GameSpy. It’s like we sold a lot of contracts and merged a lot of contracts, but my focus was really starting to be on investing in companies. The beginning part was raising capital and understanding business. Then I started making investments and then growing businesses. Then it really started to pivot into investing in the companies.
Alejandro: Did you have names first for the web hosting company and then for the online advertising company. How did you name them?
Michael Cammarata: We had a few like the Manteca Networks, EZZ Hosting. We had a lot of different corporations and stuff on those lines I set up. But in fact, I had an attorney that was a referral from a friend. So, we set up a couple of corporations, but I had different websites like Gaming MP, which then became part of GameSpy, and it was more along the lines of the websites that I was focused on, but it was done a lot like under EZZ Hosting and Manteca Networks. I can’t even keep track of how many organizations and companies I have now, so it’s even hard to go back that far.
Alejandro: I hear you. What were your parents thinking?
Michael Cammarata: I think they thought I was nuts because my dad was more of a corporate guy his whole life. He started off working in mechanics in Chicago. Then he got transferred to New York where I was born. Then he worked at PricewaterhouseCoopers. He was a chief marketing officer there, but he worked his whole way up through the big corporations, and I’m sitting here without a business plan, without really any focus. I was just throwing things against the wall to see what stuck. So, when we’d try to talk about business, I tried to explain what I was doing but remember, he didn’t even know what a server was when we first started out. He was ultra-conservative, and I’m completely opposite to conservative. I didn’t know what the gross revenues were until after the fact. Then I was making a huge amount of money in diverting product at one point and time. I was all over the place, to be quite honest, building companies. It’s kind of funny. If anybody wanted to help out or be part of it, or people I met playing video games, I was like, “Let’s build companies together.” And we built tons. It was more like a fun thing and a community thing. It was like my first way to really connect and build a community. They were my friends.
Alejandro: I hear you. Then you were mentioning you went and managed a boy band, which was probably this was the time of Backstreet Boys and NSync and all of that. At that point, it’s where you incubated the idea of what would be your next big thing. So, what happened?
Michael Cammarata: Yes, I always wanted to manage a Rock band. I have a lot of friends who are in the entertainment industry. At that point, an opportunity came up to manage a group called Big Time Rush. I jumped into that, and obviously, it wasn’t a Rock band, so I didn’t quite get the goal, but what I did learn was wow! That’s where a service business was a whole wide opening. I learned about the consumers. I learned that a TV show can spawn a music group, can spawn a phenomenon essentially, and then at retail be very successful with licensing, so that in Big Time Rush had a Nickelodeon TV show and it also had a music group with Sony. There’s where I started listening to consumers because you get to see them hands-on. They would go to the guys like, “Stop using aluminum. It’s killing you in deodorants.” They’re very concerned about stuff along those lines with the guys. Then I’m like, “Wow. If you can take a TV platform, and you can take media platforms, and you can create a group, and it resonates with the consumer, and then you can create opportunities at retail, then I was like, “Okay, wait a second.” The longevity of making a product and the impact that you can have on the planet is much greater than just being in the service business. So, primarily all of my investments prior to that point were more service-oriented investments. This is where I had Random Occurrence pivot, and they started creating brands. That’s how, ultimately, I got into natural products. Then we created a company called Schmidt’s Naturals.
Alejandro: Let’s talk about how you brought that company to life.
Michael Cammarata: Yeah.
Alejandro: How did that happen?
Michael Cammarata: I was looking for investments in the deodorant space in the natural area, mainly because of the consumer concerns about natural deodorant. I went from being very healthy and active in sports, and then gained a business and became very unhealthy on the management side. Then I started focusing my own personal journey to be healthier. We were looking for a natural deodorant company. I looked at a crystal company, and I looked at a lot of different companies in that space are big and huge, but the consumer reviews weren’t exactly there. Like the crystal company lasted too long and wasn’t as effective. There are other natural deodorants that are on a stick that didn’t work. Then I found my partner in this, Jaime Schmidt. She was selling natural deodorant in a jar at this time, and she had been working on a lot of different formulas, but she was selling the product in a jar in Portland at different regional retailers and stuff like that. So, my simple thesis was, I called Costco, and I was like, “How big of a market is natural deodorant or deodorant?” They told me a number, and I was like, “Wow.” So, my thesis was: let’s Jaime and me start a company. I’ll fund it. We’ll put that deodorant into a stick, and we’ll sell it at Costco. That’s my thought because it was a biggest seller of products. What I didn’t know at that time is that the reason her product in a jar was so successful but wasn’t mainstream is because no one could figure out how to put the powder-based deodorant, which is what the key is: powder-based, plant-based deodorant into a stick because there was no co-packer that could do it. So, we actually had to build a factory in 2015. We started with four people, 1200 sq. ft. A few months later, it was 15 people and 5000 sq. ft. Then we doubled pretty much every six months. Then by the time we were up to 180 people – we actually had to build our own machinery at first. Then we were able to build and retrofit other people’s machinery. In 2017 is when we finally were able to start training co-packers on how to handle our formulation.
Alejandro: How were you financing the operation there. It seems you guys were growing very fast, so how did you capitalize the business?
Michael Cammarata: Well, the unique thing that I’ve always done fundamentally with businesses is, always have your vendors your partners. So, I was in a good situation though with Random Occurrence to be able to have capital and stuff that I’ve accrued over the years that I invest in my companies and in my partner companies. So, capital wasn’t necessarily the issue for us because I’ve always built businesses that we can grow out of revenue. I think the problem that some people have, and I had when I was younger is that I always wanted to raise money more like as a stamp of approval than actually the needs. What I realized if you can break down your company to different elements and say, “This is what my cost structure is,” and you can involve your cost structure to even like, “We’re just starting this company. Can you give us 90 instead of prepaid?” Or like, “We’re building this cash flow model from the very beginning” and involving those as your partners, and it doesn’t have to be financial partners, but work with your vendors, and then be extremely disciplined on what you use your money for. Like I’d invest into the company. We’d obviously gotten the machinery, and we’d jump-start, but then getting it running so that then it starts generating revenue, and then managing that cash flow appropriately. So, it’s like when I go into a company, I do a lot of micro-investing in Random Occurrence, into micro-brands and stuff along those lines. So, 20 grand here, 30 grand here. Maybe a couple of million in some of the investments, but it’s really focused on building and accelerating brands that have purpose and meaning, but it was cash flow management. I think we are very good. In 2017, I was really more focused on going the IPO route. We had 11 offers from different strategics. At that point, I was actually going to raise capital with different partners because, obviously, going IPO you have to, and we were growing rapidly like quadrupling every month. So, we went from like farmer’s markets and regional retailers, and all-naturals to then Target. From Target into drug stores, Macy’s, Bloomingdales, Urban Outfitters. We crossed all categories. We weren’t limited to just like natural stores. When we got into Costco, obviously, that was a huge volume of other deodorants, and we finally got there. It was more about the Costco management. So, being very strategic and to get the initial investment, I am. I invest directly into companies, and I bring in management teams that I recruit over the years to help focus on making sure that money goes right into things that can then generate revenue, and then managing that revenue with the pace of the growth of the business.
Alejandro: Then, what would you say was one of the biggest challenges during this journey?
Michael Cammarata: I think learning manufacturing process was probably the biggest challenges because we didn’t know what we had at first. I completely didn’t know what made the formula so unique in the beginning until we had to build that manufacturing capacity to be mainstream. I think the previous natural deodorant for liquid-based formulas, and there’s machinery out and co-packers to do that, but there wasn’t the machinery to make the powder-based deodorant. And the unique thing about our powder-base, formula base is that we also use high-end essential oils. So, to complicate it a little bit more is that we don’t use synthetics, or fake fragrance, or anything on those lines. We use pure essential oils that come from like Bulgarian flowers that are extracted, then distilled, and then put into essential oils, and then put into the formula. So, each fragrance, our fragrance, our essential oils, and the base formula require different tuning in the machines. So, I think the hardest process was the manufacturing attribute.
Alejandro: You were talking about the fact that you guys were growing this with its own revenue and that the fundraising was more for a stamp of approval type of thing, which I’ve seen many, many, many times. So, how was the revenue growing year over year so that the listeners get an understanding of the growth?
Michael Cammarata: We were less than a couple hundred thousand in the beginning, and then we went to a couple of million and then 10-fold that, and then above that. So, it’s obviously owned by union leaders, so they don’t disclose the financials now. We started out like in a couple of hundred thousand, and very quickly we became, within the year, in the millions, and then became tens of millions, and a lot higher. So, it’s definitely like a high-triple digit growth.
Alejandro: Why did you decide to sell to Unilever?
Michael Cammarata: To be honest, I was completely against selling it at all. I wanted to go IPO. Lots of different people made offers on it. We had 11 offers from strategics, and then 28-some funds that were trying to invest into it or buy it. Then the pivotal moment was I got a call from my dad saying, “You need to go and meet with Goldman Sachs. They happen to be meeting with Unilever. I was like, “I’ve been to all these meetings with these strategics. I want to build a plant-based natural alternative to traditional products. I want to go IPO, and I want to scale it globally.” I was solid on that. He said, “Just go to New York and sit with them.” Obviously, I didn’t know much about Unilever at that time. I didn’t realize how big they were to be quite honest. So, I went to New York, and I ended up going to New Jersey to meet with a guy named [Case Cova 32:31]. At that time, he was running North America for Unilever. My idea was I’m going to pitch him all my ideas of what I’m going to do in an IPO, and he’s going to tell me how many things I’m doing wrong because he’s going to want to sell me to sell to him, and I’m going to learn how to adjust my IPO strategy. That was my theory for that. That 30-minute meeting ended up turning into a six-hour meeting, and he was showing me the new Unilever things. He’s like, “Why don’t you do all of that here? We can instantly get you into the global distribution. We can help you cross all of these categories, and we can build this brand.” It actually was weird because then I was like, “The guy’s a better salesperson than I thought. Now, I want to do it.” It was the weirdest situation. Then I went home to my hotel, and I called Jaime, and I was like “I don’t know. This guy sounds really good. I may have been oversold. I don’t know.” Then the next morning he calls me like 7:00 am, and he’s like, “It’s a Global Citizen Concert,” and he was taking his kids to it. He’s like, “Let’s meet at the American Museum of History and catch up.” “Okay, good.” A second take at this person, so maybe it was just like a bad day. Then he calls me, and they can’t get out of the Global Citizen thing, and back in. I was like, “I know I see Dr. Jane Goodall is speaking there.” I happen to be family friends with Dr. Jane Goodall. So, I called her because she was actually speaking at the Global Citizen’s Concert. She said, “You’re meeting with Paul Polman, Unilever?” I was like, “No. It’s Case.” She was like, “Paul and Unilever is a great company.” I’m like, “Jane, seriously?” A strategic company’s a good company? Like how is this possible? Now, I’m maybe in a coma. She gives me her backstage passes, and I go, and I meet with Case, and then Case is like, “Oh, we have Paul and Jane on the same UN committee.” I learned about their sustainability programs. Then I’m like, “Jane if I’m going to go down with this, you’re going to come with me.” So, she created actually Lily in the Valley, a scented deodorant which is in retail now. Paul Polman ended up becoming my mentor. He was the global CEO of Unilever for the last decade, and now Alan is, and he’s a good guy as well. Paul and Alan and Case and Peter became mentors to me. It’s actually where I got my Ph.D. in business. It’s all because of a fluke chance and Dr. Jane Goodall that I actually had to – the worst part about the process was I was going down the IPO, path and I actually culled money from one of these hedge funds that I had to call off and say, “I changed my mind. We’re not going to take that investment. I know you spent all this money on legal. Don’t worry. We’ll reimburse you for the legal, but I’m going to sell the company to Unilever. It was kind of an awkward situation, and there were definitely some stressful moments in that. But it was a last-minute pivot, and then Unilever – we launched an AI at Unilever. We built that and expanded the line. I learned a lot like global structures. I went all over the office, and they’ve been like family to me. So, it’s kind of like my college experience.
Alejandro: Really cool because at the time of the acquisition when you signed the documents and everything, how big was Schmidt’s?
Michael Cammarata: Oh, we can’t disclose that.
Alejandro: How many employees did you have?
Michael Cammarata: Over 180.
Alejandro: Got it. Really cool. After doing this Ph.D. as you said in business with wonderful mentors, you’re back at it again leading Neptune Wellness Solutions. What are you up to here, and when did this come about as well?
Michael Cammarata: It was an opportunity that emerged and what was really unique about it is learning what I learned about fragrances, essential oils, and naturals that the extraction methods are probably one of the most crucial parts to personal care, home care, and consumption items. So, whether it be taste, flavor, or smell, extraction is where the quality is made in the formulation process. So, I’ve been looking at the cannabis sector for different investments and opportunity. Mainly, I’ve been focusing on plant-based ingredients and plant-based products and consumptions. So, I was looking for an entry point. Then out of the blue, I got an opportunity that came through mutual friends when they contacted me about Neptune. I started looking into it, and what I really liked about it is actually, Neptune wasn’t a cannabis company from the beginning. It’s actually been around in 1999 and 1998 when it was in Krill Oil Omega 3s and doing an extraction for them. They actually understand the supplements and that process of the extraction, and they had patentable technology that was done in Omega 3s, and they set the gold standard. It launched some of the biggest brands in Omega 3s. Then they made a pivot to sell the Krill Oil business, and get into the cannabis business a couple of years back. What was unique about it is a lot of the IP that they had from extraction and knowledge from the supplement and the Krill Oil business apply very well to the cannabis business. A lot of people think when they talk about cannabis, they think like consumption, like smoking, pills, supplements, and stuff on those lines, and edibles. When I look at the cannabis, I look at this plant, this very unique plant. It’s a plant that has CBD and a lot of different cannabinoids and flavonoids, and lots of research is still coming, and now, it will be even more accelerated into it where it has different anti-bacterial, anti-fungi. I look at this plant as something more. It’s not just a consumable business, but I look at all the personal care items that you can enhance with it, be helpful, which can potentially make things more and more, and all the different values. So, the science that’s being developed today in research today has such a huge impact, not to some of the consumables, but on the personal care items and the home care items. And also, the attraction you can make high-end fragrances, essential oils, with as big as companies are switching out of synthetic fragrance, and the natural fragrance put these companies in very good position to capitalize on several different things: 1) the research and plant-based ingredients, going beyond just consumables, but into personal care and home care items. That’s how this came about. When I had that opportunity to become the CEO, and I even invested into the company, it was something else that – it was a hard thing to make that call because I love Schmidt’s and the brand, but after we got to the global launch and I trust Unilever totally; they’re like family. I felt that it was the right time for me to be able to jump into this emerging market and really be able to add that level of quality, transparency, and knowledge into.
Alejandro: Because this is a company that started in ’98, and also it’s a company that went public as well. Is that right?
Michael Cammarata: Yeah. It’s publicly traded on the TSX and Nasdaq.
Alejandro: Got it. How many employees do you guys have?
Michael Cammarata: We’re over 100, and it keeps growing. We just recently announced an acquisition in North Carolina of SugarLeaf, so we have our hemp SugarLeaf facility in North Carolina. We also have our huge plant in Sherbrooke in Montreal. It’s a Montreal-based company. We’re pretty sizeable, but we’re actually growing really rapidly, so it’s kind of a unique situation. It’s obviously a good size, and what I like about it is the entrepreneurial spirit. The team has been around, and a lot of these people have been at the company for 5+ years, 6+ years. They’ve had a lot of experience in the supplement business, the extraction business, and they come a lot from the pharmaceutical side. So, it’s a really good management structure and people from the factory level and all the way up and down. It’s like it was definitely a unique situation and publicly traded. I always wanted to run a publicly-traded company, so again, it was right on par, and to be able to deliver plant-based ingredients and make traditional products alternatives. So, making essentially a plant-based alternative through traditional product, but now do it not only just in the stage and with just a handful of products, but actually be able to utilize cannabis ingredients and plants into the mix is a whole different thing.
Alejandro: Very cool. Normally, for the guests that I have on the show, I ask them this question, and I would like to hear your answer. So, given what you know now in business, from really making tons of money, tons of innovation, at 13, 20, then to doing your Ph.D. in business, being in a large corporation like Unilever as well, and now running a publicly-traded business, if you had the opportunity to have a chat with your younger self, perhaps that kid that was 13 years old and give that little kid one piece of business advice, what would that be and why before launching a business?
Michael Cammarata: I think there are a couple of things I would tell myself, but mainly it would about like 1) I wish I would focus on getting confidence early, 2) don’t look at trying to do things the way people are telling you to do them. Look at the way that you feel is the best. Your way may be better. So, don’t try and always compare yourself to others, and at the same time, don’t rely on others to build you for gratifications. I think some people go and they try to raise money more for a stamp of approval, and they rely on – even in the beginning, my attorneys at that level in the beginning and my attorneys now are a lot different because when you hire people and all that, don’t be afraid to voice your opinion. I think the simplest way is, get your confidence earlier in yourself. Don’t always follow the patterns. If you feel you should be doing it a different way, then it’s probably the better way to do it. Then 3) surround yourself with the best advisors you can have, but don’t rely on them. You have to make the decision in the end.
Alejandro: that’s very profound. Michael, for the folks that are listening, what is the best way for them to reach out and say hi?
Michael Cammarata: I’m on everything from Instagram to Facebook to on the web. So, I guess on my personal Instagram, it’s mike@cammarata and obviously, Michael Cammarata on LinkedIn and Facebook.
Alejandro: Wonderful. Michael, thank you so much for being on the DealMakers show today.
Michael Cammarata: Thank you for having me.
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