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Episode Summary
You’re heads-down running the business, fixing the next problem, chasing the next account. You haven’t once stopped to ask whether the thing you’re building is actually a financial asset that someone else might one day pay you for. That was David Lekach for eight years. He had a problem (he couldn’t sleep), built a product to solve it (Dream Water), and elbowed his way into Walmart, CVS, Duane Reade, Publix and Safeway. He didn’t know any of it was going to be worth $34.5 million until someone wrote the check. This is Part 1 of our two-part conversation, focused on the growth story. David and I got into why he refused to put capital into manufacturing, what “what business are you actually in” really means when you’re a CPG founder without a factory, how data discipline from day one let him stay lean while he scaled, and the part most founders skip: stopping long enough to celebrate. Part 2 covers the sale to One Harvest. This one is about how he built the asset he didn’t know he was building.
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## Top 10 Takeaways- You can spend eight years building a financial asset and never once think of it as one.
- Experience is overrated. The founders who break into Walmart often had no CPG background before they did it.
- Put capital into what the consumer sees, not the factory floor. You can rent the factory.
- “What business are you actually in” is the question that decides where your money goes for the next five years.
- Data discipline from day one is what lets you stay lean through every stage of growth.
- The fuel that keeps you in the chair for year eight is the impact on real customers, not the math.
- Born vs. chosen is the wrong question. Can you stomach the cost of finding out is the right one.
- Big-box buyers don’t care about your story. They care about what their shelf needs that you can deliver.
- Stopping to celebrate the wins is the discipline that keeps owners from burning out before the exit.
- You only learn what you have by walking through the door of selling it, and by then the building decisions are already locked in.
Sound Bites
“People overrate experience sometimes.” (@00:14:16) — David Lekach
“I didn’t know it was going to be a financial asset until I sold.” (@00:23:26) — David Lekach
“It’s that desire to figure out what do I have here.” (@00:32:45) — Ryan Tansom
“You have to personally think about what business am I in.” (@00:50:10) — David Lekach
“My investments right away had to be forward facing, consumer facing.” (@00:41:41) — David Lekach
About This Episode
David Lekach is the founder of Dream Water, a water-based sleep supplement he built and scaled into Walmart, CVS, Duane Reade, Publix and Safeway before selling to Canadian cannabis company One Harvest for $34.5 million in 2018. Before Dream Water, David worked briefly as an investment banker in NYC and served as managing partner at a small Miami-based law firm, overseeing international real estate ventures worth more than $50 million and a range of consumer goods projects. Since the sale, he has worked across CPG, cannabis, direct-to-consumer, Amazon, and travel retail on innovation, executive team building, and deal structuring. This is Part 1 of a two-part conversation focused on the growth story. Part 2 covers what triggered the sale and the mechanics of the deal.
Resources Mentioned
- Dream Water — The sleep supplement David founded and sold for $34.5M.
- One Harvest — The Canadian cannabis company that acquired Dream Water in 2018.
- Auston Matthews — NHL player who endorsed Dream Water.
Connections
Phase + Module:
- Module 1 — Ownership Goals — The frame David didn’t have for eight years, and the lesson underneath the whole episode
- Module 5 — Predictable Revenue — Building the revenue architecture that broke into national retail
- Module 6 — Transferable Margins — Staying lean by refusing to put capital into the factory
Concepts referenced:
- The Owner-Operator Trap™ — Eight years heads-down without thinking of the business as an asset
- Value Gap — The space between what David thought he was building and what it was worth at sale
- Noble Aim — Solving his own sleep problem as the original fuel
- Three Lenses of Value — Operating value, owner’s value, and the market value he only learned at the closing table
- Capital Allocator — The decision to fund consumer-facing investment over operations