Michael Schneider and Murray Cundall knew nothing about online business when they met teaching English in South Korea.
Now, only three years after they started selling a minimalist phone wallet online, they’re on track to generate more than $1 million in revenue this year.
In this case study you’ll learn how they built the business, what risks were involved, and the intricacies of selling on the world’s biggest ecommerce store.
Everything we do here at eBiz Facts is geared towards helping you make smart decisions, so you don’t waste loads of time and money while building your online business.
Our case studies are no exception.
We take a scientific approach to examining every business we feature as a case study, rating and dissecting each one using the same criteria.
The end result – we hope – is that you quickly gain a high-level understanding of each business, and learn what it takes to achieve similar success.
🔎 About Gecko Travel Tech
Gecko Travel Tech is a minimalist brand selling cell phone wallets that stick to the back of your phone. They’re currently selling worldwide on Amazon, Best Buy, Walmart and a few other platforms in Asia, including their own site.
After 3 years in business, they’re on track to do over a million dollars in sales this year.
95% of sales come from the standard wallets, and the remaining 5% from custom designs.
The founders of Gecko are Michael Schenider and Murray Cundall, two friends who met while teaching English in South Korea long before they ever thought to work online together.
At the time, Murray was listening to many business podcasts, which inspired him to start “Learning Mondays.” He and Michael would get together and learn more about online businesses and how to build them.
Eventually, they decided to create a phone wallet product, later named Gecko.
Michael shares how the idea came about:
I used to walk my dog Snoop every morning. And each and every morning, I would take my phone, my wallet, and a water bottle.
After a while, I started realizing that with 10 bucks, ID and a credit card, I would not need everything in my wallet for a walk with Snoop.
Then I thought: if only I had a pocket on the back of my phone… and thus began a 1-year journey of creating, designing, and producing our phone wallet.
Success is defined differently for everyone. For us, it was really just working to get something for sale on Amazon. At the time, it was the place for people with a product and a brand to start.
We had success at the start, a few people wrote some nice reviews, we sold 1-2 units a day, and our first order for 1000 units took about 9 months to sell out (we now do that in about 4 days!).
Challenges were everywhere. Online selling is by no means a get-rich-quick scheme – we didn’t take a dime for the business for 2.5 years. We had to reinvest and build infrastructure.
There were so many things going on at that time, we were learning about shipping methods, stickering, listings and optimization, PPC ads, website design (Amazon requires you have one for your brand), and pretty much anything you can think of, even things like SOPs (we made little screen video recordings for each other).
We worked a lot and hard – all I really remember of that time period.
Currently, the majority of sales come from Amazon, and by far the biggest market is North America.
On Amazon, they operate as an FBA business.
There are two kinds of sellers on Amazon: FBM (Fulfillment by Merchant) – which means you ship yourself, and FBA (Fulfillment by Amazon) – which means they handle all of that for you but you do pay a lot more for that service.
So anywhere Amazon has a fulfillment center in the world we have stock with them. However, we can ship worldwide in 8 days or less by DHL as we keep extra stock in another fulfillment factory outside of Amazon FBA centers.
🤑 Revenue, Profit, Monetization
Gecko generated $600,000 in sales in 2018.
The business is growing every year and is on track to break $1 million in sales in 2019, which works out to ~$88k per month ($44,000 each).
There is some seasonality to the business:
- $70k/month from January to October
- $180k/month in November and December
Michael and Murray currently reinvest all profits back into the business.
We are still currently reinvesting in our inventory worldwide. It is not only about getting sales on the platforms but also about having everything in stock all the time. To do that, we require about 15k units in stock with 5-10k units always in a phase of production behind that, so as you can imagine that is extremely costly.
They don’t pay themselves a salary and only take a yearly dividend that can range from 0 to $50k each.
If we wanted to, we could be pulling out around $20k a month, but keep in mind it is very important to use the profits to build inventory and infrastructure if you plan on having triple-digit growth, year over year, and have something on the shelf to sell.
We have decided to use monthly profits for investment in inventory and instead pay ourselves a nice dividend at the end of each year.
⏱️ Time In Business
Michael and Murray started the business in August 2016.
In the early days, although we spent most of our time growing Gecko, we still found ourselves needing to hold down other jobs because there are a lot of ups and downs while you are figuring out the system.
We both worked on Gecko without pay for over a year. However, we also spent 6-12 hours a day doing the jobs that paid the bills.
One of us had to make the jump and quit all the other jobs that generated our money to live on and take a meager pay out of Gecko and focus only on Gecko Travel Tech work.
I did just that right after my daughter was born and it felt like a huge risk to me at the time. My wife and I moved to her hometown in the Thai countryside to reduce our expenses as low as we could and took a run at it.
Michael joined me a short 6 months later in this singular focus for Gecko, and we both took such a small amount of money from Gecko to live off.
It was a tough time, but we bet on ourselves and eventually worked our way up and up.
🚀 $0 → $1k/month
It took about 12 months until Gecko was able to generate $1000 per month profit consistently, but profit has always been reinvested back into the business.
💰 Starting Capital
The business was launched with a $5,000 combined investment from Michael and Murray. Most of that was spent on the production of Gecko wallets from a factory in China.
Later on, they invested another $5,000.
There was a need for additional funds to purchase more units. When we made our first order, we knew that we would need to make a second order before we sold all the units of the first one.
On average, both Michael and Murray spend ~35 hours/ week running and building the business.
Most of that time is devoted to growing the business. If they just had to maintain the operations at the existing level, it would take them only about an hour per day.
Michael and Murray are in different time zones and work at different hours.
- Michael is based in South Korea and prefers to work from 4am to 10am.
- Murray lives in Thailand and usually works late-night shifts after his family has gone to sleep.
Their business operations are not confined to specific working hours, and they are free to change the schedule anytime (as well as take a week off, go traveling full-time, etc).
I think when you do what you love, at some point the line between work and free time can become a bit blurred. I like using my free time to grow my business and if some people call that work, so be it.
If I want to take time off, I do. If my wife wants us to go out of town on a whim, we can. That’s pretty much how I function.
I can work from anywhere – so I take advantage of that a lot. I love to work in a wide open space, in foreign countries, in the airport waiting for a flight, or walking my dog Snoop listening to some podcast about something new going on in my field.
And the best part is, we can work 24 hours a day – so it really makes no difference what time we choose to work.
My family is first, and the work can fit in around that. It’s 2-4 hours a day on a light day, and 12+ when I go down the rabbit hole on something.
I have an expression that every day is Sunday. I mean that I can relax and not set an alarm, do some family stuff, and tuck away for a work session whenever. We have built the business to run itself as much as possible, and it does this well. Mike and I mostly spend our work hours putting out fires or supercharging growth.
💻 eBiz Purity
Gecko has been a purely location-independent business since the very beginning.
All of this was created with an internet connection, laptop, countless emails, and a lot of determination.
This whole adventure has been about truly being a digital nomad and having the freedom to work anywhere. I traveled all over for the last couple of years until I settled down between my home in South Korea and California to see my family.
As mentioned above, if Murray and Michael had to reduce working hours and spend an hour per day just to maintain the operations, Gecko would still be generating income for many months.
The business is well automated and can run itself for the most part.
However, there is always pressure from competitors, so they continue to grow the business to stay ahead of the pack.
Like J.J Watt said: “Success isn’t owned. It’s leased. And rent is due every day.”
I live by these words.
🔥 CENTS Score
🎮 Control – 0.5/1
Although Gecko has many sales platforms, the majority of the business still depends on Amazon.
Every time we open a new platform – we are reducing that risk of dependency.
The full list of the platforms is as follows:
- 10 Amazon stores worldwide – USA, Mexico, Canada, UK, Spain, Germany, Italy, France, Australia, Japan, Korea, Thailand.
- Best Buy
- 11th Street
- Gecko’s own website (on Shopify)
We know that the more we diversify, the better a company we become. At the same time, we are happy to play by the rules of Amazon, and follow its terms of service so that we can lessen the risk of ever being cut off.
Michael shares two things that could be done to mitigate those risks:
- Create an email list through the 6000+ customers a month that buy our product.
- Create sales funnels to get a sustainable customer base in the event we were ever to be suspended or kicked off Amazon.
We’re looking to start some traffic strategies soon on our own site. As for now, it’s mainly the platform to talk with our customers and collect custom order leads.
We can already handle a large order volume from the website with the infrastructure we’ve set up and the fulfillment service we use.
🚪 Entry – 0.5/1
The electronics category on Amazon – and other platforms – is very competitive, making it hard for newbies to compete with such a well-established business like Gecko.
We asked Michael about the key factors defining their success on Amazon:
- We put a lot of thought into our design, as well as the quality of our product.
- Our packaging looks like you bought this product in a store. It creates what we call “the unpacking experience”, which is so important. Others might call it perceived value.
- There are 3 bonus products incorporated in our packing.
- Great ratings on Amazon Worldwide. In the USA alone we have over 1800+ reviews with a 4.3-star average out of 5.
- We do a lot of A/B and split testing to find an equilibrium between the price point and velocity of units we can sell per day. When you do well on Amazon, you move up in rank. And the more you move up, the more you sell. If you run out of inventory, you fall way down. So our goal is to never run out of inventory and to maintain a price point that always keeps us on page 1 of the Amazon search results.
- And lastly, customer service is important. Murray is on top of that and takes care of every single customer personally. We don’t have that many cases to resolve though with less than a 1% return/refund rate.
Regarding barriers to entry for newbies, Michael explains:
- It costs a lot more today to start on Amazon than just 3 years ago. Now you have so many people like ourselves who are entrenched in their own categories, who spend so much on ads and can price so low based on volume, it is hard to compete. Now, that isn’t to say that if someone enters any category with a better product or revolutionized something that it won’t work – it can and it will. Go for it if you have that mindset.
- Capital investment is also needed to maintain a steady supply of inventory, ads, and media.
- Compliance is a big barrier also. Tax registrations, tracking and filing require a lot of resources.
- Social proof that you have a good quality product and are reliable as a seller takes time to build. Without this you are literally at the bottom fighting for scraps.
Michael also shared:
The challenge is to get noticed. I’ve heard a good joke: “Where is the best place to hide a dead body? On page 12 of the Amazon search results because no one else goes there!”
“Rank, Convert or Die a slow costly death” – that is the truth about selling on Amazon. There is a good reason 95% of all new sellers fail in the first year. It is hard work and for very little money. I don’t miss those days. LOL.
🙏 Need – 0.5/1
Gecko is a minimalist replacement for something most people already have: a purse or wallet.
In that sense, it’s not a “must-have” item, though it does appeal greatly to people with a minimalist mindset.
🕓 Time – 0.5/1
As mentioned previously, Michael and Murray put a lot of hours into their business, although most of it is more or less passive, especially if they wanted to maintain things at the existing level.
📈 Scalability – 1/1
Generally speaking, online stores have a high potential for scalability.
Gecko has already scaled quite admirably, and given the popularity of mobile phones and the fact that everyone needs a place to store their cash/cards, it’s quite likely that they’ve only scratched the surface.
As for now, we don’t see any natural ceiling to scalability. We expect to do about 100k units this year, and if you think about all the men, women, children in the world with mobile phones, it’s almost limitless for us. That is what makes this so exciting as well. When the sky’s the limit, it really comes down to how hard you want to grind.
We will keep opening up new platforms. You get much better at it over time and once you have a nice library of digital assets it becomes easier and easier.
🤝 Lead Generation
We spend roughly $15k a month on Amazon pay-per-click advertising. We don’t do much on social or Google just yet.
What we decided to do was to spend most of our time and energy in learning Amazon PPC ads. What we found is: the closer to the buyer you can get – in terms of when they are ready to buy – the better conversion rates you will see.
A good example of this is traffic.
Amazon had broad, phrase and exact keyword searching on the platform. You can bid different rates on these types of traffic. In my own trials, I’ve found that from the word “phone wallet” – if a person searches that through broad traffic – we have about a 6% chance to convert them. If phrase, about 12%, and exact 18-21%. So I want to take all the exact traffic that I can get.
So far there is no shortage of it. Once we exhaust all the traffic we can buy (or be able to afford it) then we will move to Google, Facebook and Instagram ads, which traditionally have a conversion rate of about 2-3%.
🎨 Key Skills
To build and run the business, Murray and Michael have had to develop the following key skills:
- Project management
- Search Engine Optimization (SEO)
- Amazon PPC Ads Management (as well as ads management on other platforms)
- Graphic design
- Inventory management
- Financial management
- Web design
🛠️ Tools and Resources
Here are the primary tools Murray and Michael use:
- Amazon Seller Central (and similar programs on other platforms)
- WordPress and Shopify – website building software
- Adobe Photoshop and Illustrator
- Klaviyo – marketing automation and email platform
- CashCowPro – data collection and analysis, A/B testing, email sequencer
- Zon.Tools – Amazon PPC management and automation software
- MerchantWords – Amazon keyword research tool
- Helium 10 – Amazon optimization software
- ConvertKit – email marketing
- Google Docs – for inventory, PL statements, SOP, collaborations, etc.
👣 Want to follow in Michael and Murray’s footsteps?
Here’s their advice:
There are so many free courses and trainings on just about any subject on YouTube. So we took a lot of those.
Start with Jungle Scout by Greg Mercer. We started with that back in the day.
For newbies, take all the tutorials on Amazon Seller Central and learn that thing inside out.
We asked Michael what he wishes he’d known earlier, and he wrote:
The most important thing is that you have to find the right product. That part of the process can not be rushed. Be prepared to go through rounds and rounds of samples until you get it right.
And don’t ever, ever, ever run out of inventory on your best sellers, ever!
The best part of building an online business like Gecko?
No one cares about what school you went to, or how much money you make, or what kind of car you drive. The only thing that matters is how badly you want this. How much you are willing to push yourself to learn.
👇 Get more Gecko
- Buy a Gecko wallet for yourself, via their website or on Amazon.
- If you’re a new seller on Amazon and need some coaching, contact Michael and Murray via firstname.lastname@example.org for more information on how you can get started making your own private label product.
- Michael has a free Facebook group where he helps with questions related to selling on Amazon.
Here’s a customer review of the Gecko wallet: