$1M Revenue, $0 Profit: Our D2C Reality Check

Honest intro: I'm not here to sell you some "become a millionaire" course or share get-rich-quick secrets. This is just three people -Fatih, Deniz & Emre(me)- sharing our deepest e-commerce struggles and wins from building a posture correction device brand from literally zero.

Everything started on February 20th, 2020. I was pretty new to digital marketing - maybe had 2 consulting clients, can't remember exactly. But I was obsessed.

Working day and night, couldn't stop reading and discovering new stuff.

My approach to finding clients was simple but effective: I'd study brand accounts and websites I loved, then reach out to founders wherever they were - didn't matter the platform - and try to add value.

That's how I met Fatih (CEO of Kodgem). Started helping with their posture device "Straight" without expecting anything back. Classic startup story, right?

The Reality Check

When I joined the team in 2020, Kodgem was this small, humble company that Fatih had started with his wife. Like most entrepreneurs, they'd made countless sacrifices - burned through almost all their capital, even went into debt to create this solution.

So we were starting with extremely low ad budgets, trying to carve out space and explain our solution.

The advantages: Our product actually solved posture problems well, and users gave great feedback.

The nightmare: Selling physical products with limited capital meant small, frequent production runs = higher costs per unit. Combined with ads and other expenses, profitability was brutal.

But these challenges taught us lessons we'd need at every scale.

Our Strategy (The Hard Way)

We entered a market where a strong competitor had already educated customers about the concept. Our job was to redirect customers with the right triggers.

During a time when people were looking for posture solutions (especially with remote work exploding due to COVID), if you could give them something that actually worked - unlike existing solutions - natural word-of-mouth would happen.

Our strategy: Target people who were "aware of the problem" and sell them the result, not just the product.

The pandemic helped. Remote work acceleration + desk workers' increasing problems = perfect timing for Straight.

Scaling Facebook/Instagram

As sales picked up, we started increasing ad budgets in early 2021. We tested different creatives and specifically targeted desk workers based on market signals.

In 2021, we increased our ad budget by 400%. This boosted brand awareness, opened doors for partnerships, and increased customer awareness levels.

Google Was... Complicated

We used Facebook/Instagram as our main engine, but growing brand awareness meant we needed to invest in "posture" and related keywords.

Google was not kind to us. Products kept getting rejected, thrown into health categories, global competitors could run shopping ads and retargeting while we couldn't. Very frustrating.

We stuck to search ads only. Hopefully our global experience won't be the same, because we have a long road ahead.

Going International

Last 6 months of 2021 and early 2022, we ramped up global sales efforts. We didn't want to depend only on domestic sales, but couldn't find what we wanted globally.

After 2 failed Amazon UK attempts, we launched on Amazon US in May 2022 with someone and caught good momentum.

Amazon US is harsh but educational. You have to be fast, keep customers and the platform happy. Creatives, ads, fast returns taught us a lot. We tried to respond as quickly as possible as a team.

2023: Fast Start

January 2023 alone hit about 30% of our entire 2022 revenue.

Good start, but we have 2 new products coming. Product launches, required engineering, content and marketing setups, and tons of other details await us.

Goal for 2023: Continue profitable growth. We're tracking profitability, break-even points, and unit costs across all channels in detail.

2024: Rock Bottom and New Product Hell

By early 2024, we knew we had to launch our new product (V2). Everything we had left went into this effort.

Let me tell you - developing a new product while your existing business is barely profitable is its own special kind of nightmare:
• Spent months perfecting the design while burning through remaining cash
• Manufacturing delays that pushed launch dates back repeatedly
• Had to pay for new tooling, prototypes, and testing with money we didn't have
• Every setback felt like it might be the final one

The breaking point: We came within inches of shutting down the company 4-5 times in 2024. The stress was unreal.

Each time we thought about quitting, we'd remember the customers who genuinely loved our V1 product despite its flaws. That kept us going when the bank account hit scary numbers.

2025: Finally, Some Light

Right before 2025 started, we launched a Kickstarter campaign for our V2 product. Finally did something right - the campaign actually worked well and gave us the validation (and cash) we desperately needed.

Then something we never expected happened: we got investment. Real money from people who believed in what we were building.

Now we're opening new channels and actually have a runway to execute properly. It only took us 5 years to figure out that you can't bootstrap everything forever.

The Brutal Truth: Why $1M Revenue = $0 Profit

Let me be completely honest about why we hit $1M in revenue but ended up with basically zero profit. These are the mistakes that kept us from actually making money:

1. Inventory Planning Disasters

Our limited capital meant we could only produce 1,000 units at a time. But here's the kicker - each subsequent production run cost MORE per unit, not less. Why?

• Small batch productions = higher per-unit costs
• We'd run out of stock during peak demand periods
• Emergency productions at higher costs to meet demand
• No economies of scale because we couldn't afford larger runs
• Storage costs ate into margins when we did overestimate demand
• Had to throw away expired/damaged inventory multiple times

The cycle was vicious: make 1000 units → sell them → need 2000 → can only afford 1200 → pay higher per-unit costs → repeat.

2. Zero Financial Management (No CFO)

We were typical founders - good at product and marketing, terrible at money management:

• No real financial planning or cash flow forecasting
• Didn't track unit economics properly until way too late
• Mixed personal and business expenses (rookie mistake)
• No proper budgeting for different scenarios
• Reinvested everything back without keeping reserves
• Didn't understand the difference between revenue and profit until it hurt

We basically learned accounting by making every possible mistake first.

3. Product V1 Was Honestly Not Good Enough

Our first version had user experience issues that killed retention:

• Confusing setup instructions - customers couldn't figure out how to use it properly
• Uncomfortable for longer wear (design flaw)
• Poor packaging that made the product look cheap
• No proper onboarding sequence for customers
• High return rates due to user confusion, not product defects
• Had to spend tons on customer support to explain basic usage

Bad UX = high customer acquisition cost + low retention = profit killer.

4. Bootstrapped Pride (Stupid Decision)

We refused external funding out of pride and fear of losing control:

• Limited growth opportunities due to cash constraints
• Couldn't negotiate better terms with suppliers
• Missed market timing because we couldn't scale fast enough
• Competitors with funding overtook us in key periods
• Every mistake was amplified because we had no buffer

Looking back, some strategic funding could have solved 80% of our problems.

5. Failed Marketplace Partnerships

We thought partnerships would be easy money. We were wrong:

• Gave away too much margin to get into marketplaces
• Didn't understand each platform's specific requirements
• Poor performance led to account suspensions and lost inventory
• Invested heavily in marketplace-specific consulting and didn’t work

Each failed partnership cost us months of progress and thousands in lost inventory.

6. Never Paying Ourselves

This might be the dumbest mistake of all. For 5 years, none of the founders took a salary:

• We convinced ourselves we were "reinvesting everything"
• Reality: we were slowly going broke personally while building the business
• Made terrible financial decisions because we were stressed about personal money
• Couldn't focus 100% on the business because we had personal financial pressure
• Almost burned out completely multiple times

The irony? A business that can't pay its founders a basic salary isn't really a business - it's a charity case.

The Real Lesson

Revenue is vanity, profit is sanity, but survival is everything. We got caught up in the growth story and forgot the most basic rule of business: you need to make more money than you spend.

The $1M number looks impressive in headlines, but at the end of the day, we were just an expensive hobby that happened to have customers-until we weren't.

Sometimes you have to almost lose everything to learn what actually matters. For us, that was building something people actually want to use, not just buy once.

P.S. Huge thanks to Taylor Holiday and the entire team at CTC, Andrew Foxwell, Jess from HireFireTeam, Cody Plofker from Jones Road Beauty, and the whole D2C Twitter community. Learned invaluable lessons from all of you that helped shape our journey.