How we scaled to $100M in under a year (ft. IM8 co-founder Danny Yeung)

Danny Yeung (0:00)

We hit 100 million annual revenue run rate in 11 months. Prunes Daily in 22 months, right? And they were acquired for 1.2 billion. A2 One took them 10 years to hit 100 million. We hit 200 million run rate in 18 months.

Shaan Puri (0:24)

All right, Danny, welcome to the show, man. Why don't we start off, I'll just give a little intro to yourself. So who are you? What do you do?

Danny Yeung (0:31)

Hey, Sean, thanks for having me. Quick background myself, always been an entrepreneur. Started working at a very young age at 15 I was a telemarketer, so that's how I got started working. Age 24, I had my first business, was a restaurant, did that for three, four years. Then ventured into hotel furniture business, import export from China into the US. Eventually worked on some big projects like the MGM City Center in Vegas. Did that also for the three, four years. Then in 2010, I took a leap of faith and moved to Hong Kong to launch an e-commerce company that was doing group buying. Then when group buying went international, they acquired 51 percent of my company. We became the largest e-commerce company in the region. I left in 2014, we're doing about 200 million annual revenues. I had a good exit, that's where I made my first million. That's it per se, more than a million.

Then after e-commerce, I was like, hey, what do I do next? I had a lot of options at my disposal.

I didn't just want to go back into e-commerce, even though that was the easy route for me.

I ventured, then I actually got started in diagnostics and DNA testing. So founded Prenetics, which was a life sciences DNA testing company. Again, this was 2014, so very early. No one was really talking about this stuff. You'll see that in my entrepreneurial career, it wasn't the obvious choice, but everyone's now looking back is obvious choice, right? I'm thinking about in 2010, no one was using e-commerce in Hong Kong. Yeah, everyone in fact told me to go back to US. They're like, Danny, just go back to US. This model is not going to work in Hong Kong. We made it and then one e-commerce company at the time. But going back to Prenetics, we started out as a life sciences company. When COVID hit, we were prime position to take advantage of it. We worked very fast. In two weeks, we got our COVID testing kit. We then became Hong Kong's number one COVID PCR provider, as well as in the UK.

In those three years, we were printing money.

Shaan Puri (2:39)

They exploded.

Danny Yeung (2:41)

At one point, we were doing 40,000 PCR tests a day. We totaled 28 million. This is laboratory PCR tests.

Those three years, we did 700 million plus revenue.

In three years' time, we listed on the NASDAQ in 2022 We were household name. Everyone that arrived in Hong Kong at one point had a mandatory prenetics PCR test. And then, of course, that goes into IM8, which is kind of what happened after COVID. We had a billion dollar valuation during COVID in 2022 because COVID was still going on. 18 months later, our market cap hit, I think it was like 50 million. It went from a billion plus to 50 million. All that shit, all right? You really know who your friends are at that point, right? Because at a billion...

Shaan Puri (3:33)

You got a lot of friends at a billion.

Danny Yeung (3:36)

You got a lot of friends at a billion.

Shaan Puri (3:38)

When you're down 95%, okay, the stock's down 95%. Were the friends also down 95% or it wasn't so bad?

Danny Yeung (3:45)

No, I mean, the friends wasn't down 95%, but when you're going up, everyone wants to be involved, which is natural, to be fair, right? Everyone wants to be surrounded by winners, but very few want to be surrounded and associated when you're going down, right? Because I think the path to recover is significantly much harder. I mean, we had a few options, like, you know what? Why don't we just close the business?

Because you have to think about the background, right? I think in 2022, we did 272 million revenue, right? And basically, 40,000 tests turned to nothing, right? So basically, you know, our revenue dropped by 95%.

And to be fair, I think the market, you know, realized that and it was rightfully valued. So we started here, what do we do?

You know, do we close up shop, just return capital to our shareholders?

Do I do something else? I mean, of course, I've been successful as an operator, as well as an investor, right? So I love options still, but, you know, I knew that I still wanted to create something out of this and also wanted to be very responsible to the shareholders from before. Coincidentally, at the same time, as we were thinking what to do, you know, I had the opportunity to meet with David Beckham. And this was right at the same time where I was thinking about getting into the supplement category. And when I met David, you know, it wasn't to like pitch him on, hey, let's get to the supplement category. We're just having a conversation about his background, what he's doing. And he was very intrigued about my consumer background, as well as my life sciences background. And he was telling me about his problem, him and Victoria's problem about how, even for where they are as individuals, and of course, they have all these resources available to them, right? They even found the supplement category very overwhelming, especially that when they're traveling, they just can't maintain that routine of taking 12, 13, 14, 15 pills in these capsules and etc. They just, yeah, don't do it, right? And then me as an entrepreneur is like, hey, I'm sure there's a better way for that. And after three to four months, countless conversations as I'm sure you can imagine, and someone with David's pedigree and background, if something went wrong, it's not, no one cares about Danny. It's always going to be, hey, David, something blew up, right? So he had to take significant precaution. And I told David from day one, hey, David, I know for the last 30 years, there's been so many people wanting to do this category, and he's rejected. And I told David something that was surprising to him. I was like, David, if we do this together, yeah, I don't want you just as ambassador, I want you as a co-founder, but this brand has to live beyond you. I don't want this to be another celebrity brand.