Shinghi Detlefsen, BS 13 – Finding Million Dollar Ideas Everywhere

(Transcripts may contain a few typographical errors due to audio quality during the podcast recording.)

[00:00:00] Sean Li: This episode of OneHaas is brought to you by the Haas Fund, fueling opportunities for our students, faculty, and strengthening our Haas community. Join us in making an impact today at haas.berkeley.edu/give.

Welcome to the OneHaas Alumni Podcast. I’m your host, Sean Li. And today, we’re joined by Shinghi Detlefsen. Shinghi is an undergrad Haas graduate class of 2013. He currently serves as the president at Wholesome Story and is the CEO of ExpandFi.

Welcome to the podcast!

[00:00:46] Shinghi Detlefsen: Thanks for having me, Sean.

[00:00:49] Sean Li: Shinghi, we like to start these conversations with your origin story, but before that, I’d like to give some context for our listeners how we met because I find it really interesting. We met at this conference in Vegas, MDS, Million Dollar Seller, Conference. I was just tagging along with a buddy of mine because he’s been trying to pull me back in the e-commerce world. And Shinghi was there as I flew in and walked in the conference center, demoing ExpandFi to my buddies, and then somehow figured out that we’re both Haasies.

And my immediate thought was, “We need to have you on the podcast.” So, that’s how we got here. But Shinghi, you know, you’re an entrepreneur now. Growing up, did you have other entrepreneurs in the family? And I ask this question in context of your undergrad degree. Like, what was it that you wanted to go pursue, if you had an idea, going into college?

[00:01:40] Shinghi Detlefsen: I remember as a kid, like, we moved to Virginia when I was, like, seven from California. And I remember we were doing a yard sale for, like, selling stuff before we left. And I was in charge of the money and selling things. And I still remember, like, being a little kid, I loved that. I loved selling things and, like, making money. And it always was in my interest sphere. And, like, even when we moved to Virginia, like, I was, you know, seven, eight, nine, 10, 11, I was mowing lawns, making money.

Like, I think my parents also raised me with that type of mindset where there are no handouts. Like, you don’t just get money from your parents. You need to go earn it, you know. And so, like, I was into paintball a lot when I was that age. And I would mow the owner of the paintball field’s yard. So, I would make my 20 bucks mowing his yard, but I also built a relationship with him where, like, he would let me go and play paintball for free so I wouldn’t have to pay the admittance fee and the rest. Yeah. And so, like, I remember just doing that from a young age. And even when I was in undergrad, I would sell stuff on Amazon.

On Reddit, there’s a form for, like, old books or even just regular books. And some of these books would go trending, but they were, like, books from your childhood, so they were hard to find. They weren’t still in print. I would go to Half Price Books in Berkeley, and I would go buy up all of them. Like, these are, like, those castle drawings, I don’t know if you remember those books, where it’s like… yeah, right? And I would buy up as many as I possibly could from Half Price Books and go sell them on Amazon. And I would make, like, 10x whatever I paid at Half Price on Amazon. Well, that was really, like, my first time selling on Amazon.

[00:03:18] Sean Li: What year was this, if you don’t mind me asking?

[00:03:21] Shinghi Detlefsen: I mean, that must have been, like, 2009, 2010.

[00:03:24] Sean Li: Wow.

[00:03:24] Shinghi Detlefsen: So, fairly early in what Amazon was back then. I mean, it was, like, a book company for the most part.

[00:03:29] Sean Li: Yeah. So, what’d you do after Haas?

[00:03:32] Shinghi Detlefsen: So, even before Haas, I went to Berkeley City College. So, I’m one of the transfer students at Haas. And that was an interesting… you know, like, going to community college was a great experience for me. You have teachers where the class size is still, like, 30 people, or professors I should say. And you get to, like, meet the professors. You actually get to talk and have interactions with them through your undergrad. And you meet very interesting people, especially because you’re in Berkeley, so you have, like, berserkly-type professors. And it was fantastic.

And then I applied to Haas. Haas was always, like, my end goal. And I’m, kind of, of the mind where, like, I focus on one thing. I didn’t even apply to other schools. Like, I think I maybe checked the box for, like, UC Irvine or something, but everything I was doing, all the pre-reqs, were just for Haas.

And even while at Berkeley City College, like, I started a club there, which is called the Conscious Capitalism. And it was during that wave of, like, you know, how can capitalism be greater than just for itself and the rest. And applied to Haas, got into Haas, still remember that day. That was a fantastic day.

Well, you went to MBA, so, you know, getting into any school that you wanted to get into, or you’ve worked so hard to get into is a great day. And while at Haas, I got an internship at Hulu down in Santa Monica. And it was, like, that was an awesome experience. And what I tell people is the benefit of going to, like, a Tier 1 school is that it opens doors, at least initially, right?

[00:05:02] Sean Li: Right.

[00:05:02] Shinghi Detlefsen: Like, that’s, like, a brand that you have on your resume that, you know, it’s hard to get into. It’s a tough environment. The output is high. It’s a brand on your resume. And that opened the door for me to go to Hulu. And that was a great summer internship. Literally rented a pool house in Santa Monica. I would go surfing almost every single day. Met some great people, still people that I know today. And then after that, I graduated at Haas.

I had a job offer at Hulu, which, you know, like, if you go through your last year at school and you have, like, a job offer, good or bad, that is, like, major stress relief there because you’re just sitting there where, like, you know, worst case, I have this. So, that’s another reason, like, you have to get internships.

And the one thing that you don’t get from community college is that. Like, a lot of my peers at Haas, they were getting internships in their, like, sophomore years, sophomore, and then they were a junior. And then by senior, they were pretty much, like, ready to go. Whereas, like, I was a little late to the game because I got it in my junior year. So, you know, that’s the one downside of community college, but the rest was really good.

[00:06:08] Sean Li: That’s amazing.

[00:06:08] Shinghi Detlefsen: And then leaving Haas, I interviewed at Google. My friend had gotten a job at Google. And Google+ was really big at that time. And I applied for a role there on the Google+ marketing team. And I got it. And so, the choice was between Hulu and Google. And Google was a contract role. Like, if you’re familiar with Google, like, so much of their workforce is just contract. But I did that. And that was a great experience to go work straight at Google.

[00:06:36] Sean Li: You stayed at Google for 11 months. I guess, how did you transition then to Amazon?

[00:06:40] Shinghi Detlefsen: So, when I was at Google, I had a Bay-Area mindset, problem syndrome, whatever you want to call it.

[00:06:46] Sean Li: Well, what is that?

[00:06:47] Shinghi Detlefsen: So, that’s where you think the Bay Area is the center of the world, right? And you believe that there’s no better place to live. And, you know, I was from there, too, so like, it’s just, like, the greatest place in the world, but I had never visited Seattle. And so, while I was at Google, I got an interview from a recruiter from Amazon.

And I was like, “Huh, a free trip to Seattle. I’ll interview for that.” And I didn’t think about taking a job at Amazon. I just wanted the free trip to Seattle. So, I talked to the recruiter. I passed, like, the phone screens. And I got the interview. They flew me up to Seattle. And then I went through the whole interview process, but I was completely relaxed because I was like, “I don’t want this job. I, kind of, more so came here for-“

[00:07:32] Sean Li: For the trip?

[00:07:32] Shinghi Detlefsen: “… a free trip.”

[00:07:33] Sean Li: Yeah.

[00:07:34] Shinghi Detlefsen: You know. And so, because I was so relaxed, I did really well in the interviews. And now, they gave me the job. And at that same time, my friend from Haas had started his own company, and he had moved to Texas, and he offered me a job to go to Texas to do a startup. And I was like, you know, I was interested in trying that.

And so, it was between Amazon and a startup job. So, again, like, I have to de-risk whatever decision I make. And I told Amazon, like, “Hey, I’m going to go do a startup, but if that doesn’t work out, is that job still… like, is this an open offer?” And they said, “Yeah.” So, I de-risked the decision now to go to Texas with that backup job offer with Amazon. And I went. And I did that for three months. And it turned out to be not what I thought it would be.

And I called back up Amazon and got moved up to Seattle. So, like, that job at Amazon was, like, an entry, right? It was, like, an L4. It was called a brand specialist role, which is basically a vendor management role at Amazon. And it was just a constant inflow of people, right? So, like, at the time, Amazon had very high turnover. Like, it was, like, one to two years and people would bounce because the work environment was very challenging and difficult.

And even when I got there, I was like, “Holy crap, there’s no way I’m going to be here for more than a year.” I learned more in my first year at Amazon than I learned at UC Berkeley. Like, that’s how difficult and challenging that environment was. It was just an incredible experience. Like, I forgot what the class was at Haas, but you take, like, these modeling classes and things, but until you have to solve a real-world problem, it’s theoretical to you, right?

So, I would say, you learn maybe some theory, but you don’t learn in practice. And I’m a very much person that’s, like, I have to learn by doing. And then the other piece is writing. Like, Amazon is a written culture. So, there are no PowerPoints. I’m sure you’ve heard that, right? You don’t have, like, a presentation where some guy stands up in front of everyone and talks about it. Everything’s in a doc. So, I had to learn how to write.

And that has been the most valuable asset that I’ve learned from Amazon. I still use it today. I try to have my own team lean into writing versus presenting just because it’s so much more tangible and it also forces you to think very clearly because you can’t… Like, if you’re presenting, you can, kind of, run on and you can, kind of, talk and maybe paint a broad picture and people get bored where you can move on to the next thing. In writing, you cannot, either it’s logical and it makes sense, or you stop, and you write, like, why is this the way it is?

So, I ended up sitting in Amazon for six years. And I was in retail for a year and change. And then I moved to Prime Video. And this is when Prime Video was, like, completely uncool, right? They didn’t have, like, much content, but they were just starting to get content. And I watched Prime Video go from that into what it is today. And also, I was on a team that did the international expansion of Prime video. So, it was like, at the time, Amazon was just a really exciting place because it was transforming from a retail company, which was, what, you know, you go shopping on amazon.com, to a tech company, right?

It was Prime video, it was Alexa, it was AWS, and, like, everything else that came with that, I was right in the middle of that transition. And I remember, I joined, Amazon stock was 300 bucks. When I left, it was 3,000. Like, that was the spread. And I contribute all that to myself, you know. And then it went down after I left. I mean, that’s probably… you know.

But no, it was really exciting. And the other great thing about Amazon is, like, it’s a meritocracy. So, you could bullshit maybe, like, a year max, like, if you, kind of, don’t know what you’re talking about, but because it’s a doc culture, it’s proven so quickly that, like, you are unable to perform the tasks that you’re given or whatever. I love that. I found Google to be less so of that. It was a little bit much more political, who you knew other things.

[00:11:45] Sean Li: Yeah. I guess, I actually have never heard of the doc culture at Amazon. And, you know, pardon my ignorance here, but-

[00:11:51] Shinghi Detlefsen: Sure.

[00:11:51] Sean Li: … like, okay, say, you skip presentations and all these things, how do you ensure everybody reads what’s written?

[00:11:58] Shinghi Detlefsen: So, you still have meetings, but the first 15 minutes of a meeting are spent reading the doc about what you’re meeting about. So, it could be anything from, like, a weekly business review or a monthly business review-

[00:12:12] Sean Li: I see.

[00:12:13] Shinghi Detlefsen: … or it could be a new product that you want to launch. So, Amazon has this document, which is called the PR/FAQ, the press release and then FAQ. It’s a six-page document. It’s the one that Amazon’s most well known for. And that document can take you months to write.

Like, you get better over time, but it has to go… especially on, you know, if it’s a deciding document for, like, a Jeff-Bezos level or an SVP level, the iterations that you do on the document are insane. Like, you will edit and review that document dozens of times before it gets to a Jeff-Bezos level.

But the value of a doc is that it lives on without you. You don’t need that person to come back and present that idea to you. You just read the doc. It’s almost like a command if you think about the military. This is the command, and that is the direction you’re going to go. Don’t change it unless you come back to me.

And then everyone at third’s worried about the command or whatever it is. It’s like they review the doc. And the doc’s the doc. That’s what you go do. And if you need to pivot, you know, you can always pivot, but you usually need to go back up the chain of command for that. But yeah, I’m a big fan of it. Like, if I ever had to run a company the size of Amazon, I wouldn’t do it any other way because of it.

[00:13:23] Sean Li: Is that how you run your companies now?

[00:13:26] Shinghi Detlefsen: As much as I try to, but Amazon does something called operational plan, and they do operational plan one, operational plan two, OP one, OP two. And what that is, is that’s your plan for the year or next year. And so, like, you have OP one, and that’s, like, I think you do that, like, midyear for next year. So, you’re planning out next year midyear this year. And then you have OP two, which is early in the year for that same year. And that’s just making sure that the direction of OP one is still correct for your team.

And so, this is where, like, you know, you’re in a big corporation, so if you have, like, dependencies on other teams and the rest, like, everything needs to be aligned. I mean, what we found at, like, Amazon is that… at least, I found this is the problem with big corporations, and this is the same problem in the government, this is, like, the same problem in anything big, is kingdom building.

And kingdom building is where the way you, you know, move up ranks or become a director or become a VP is you either need to invent a new kingdom for you to control or you just, kind of, like, expand into your own kingdom, like, with existing resources and you pull people into that, like, “Oh, this team should really be with me.”

And there’s so much of that at Amazon where it’s almost become, I would say, like, a big problem for long-term success because there’s so much wasted. There would be teams that are building the same thing, but they don’t want to really know about each other because then they might risk losing their ability to build the same thing.

Does that make sense?

[00:14:54] Sean Li: Yeah.

[00:14:54] Shinghi Detlefsen: It’s, kind of, like, the other people’s money problem, OPM, where, like, if me, as the business owner, and I saw my team working on the same thing, I’d be like, “No. I’m not spending double to get the same thing from two different people. One of you works on it. And the other, let’s go work on something else.” In Amazon, that’s not the case always.

[00:15:13] Sean Li: Do you think that’s intentional, I mean, in terms of trying to get the best results?

[00:15:17] Shinghi Detlefsen: They would sometimes say that it was intentional because you’d have two teams building it. And whatever’s-the-better-thing-wins type of deal. The one thing I really liked about Amazon was when they would do single-threaded leadership teams. And a single-threaded leader is basically a king with full domain of their thing.

So, for instance, like, international expansion. That was led by a single-threaded leader on international expansion. So, if there was tech that had a dependency from another team, but that team has a roadmap already built for, like, two years and they can’t get to it for another two years, this team just builds it, and they move forward.

So, if you remember, like, Amazon, when they had Prime Now, or any other app, they would just launch their own app instead of integrating it with the Amazon app. And over time, they’ve integrated everything into the Amazon app, but that was the same concept where, like, we can just move faster if we do it ourselves. And that’s been a tremendous pro for Amazon when they do allow that.

[00:16:10] Sean Li: It’s definitely interesting to hear some of these strategies for larger companies. And speaking of building, you know, I’d love to hear about what you’ve built yourself with Wholesome Story and ExpandFi.

[00:16:19] Shinghi Detlefsen: Sure. Yeah. So, Wholesome Story, it’s a dietary supplement company. We focus on women’s fertility and wellness. And it’s a very rewarding space. It was started by my wife back in 2017. And I was working at Amazon at the time. And Amazon actually encourages their employees to have seller accounts.

You know, it’s, like, the old dog food adage, right? You should be eating your own dog food to make sure that it’s good and whatever. So, they encourage employees to have seller accounts, and they actually give people seller pro accounts, which are, like, 40 bucks a month. Amazon gives you, like, no perks, to be honest. You get 10% off $1,000 every year. That’s your perk for working.

So, it’s $100, right? Like, there’s, like, very little perks compared to the Googles of the world and the Facebooks of the world, but one thing they give you is a seller pro account. And so, while I was at Amazon, we had just had Leon, our first child. And my wife wanted to figure out what she wanted to do in her life.

And my good friend, Jonathan, had recommended that she take an Amazon course, like, how to sell on Amazon. And she took it. She was like, “This is for me. This could be something that, you know, I could do from home and the rest.” And, you know, I helped her every step of the way, but she is the driving force behind it. And then, you know, she’s always been in health and wellness is, kind of, her passion. She was a yoga teacher, yoga to the people in Berkeley.

She got her yoga teacher’s license there. And, you know, it was, like, a certified health coach and things like that. So, we started with a product that was a gray felt letter board. It was her first product. And in these Amazon courses, they sometimes… Like, the whole group of people are, like, a school of fish, right?

And they’re just, like, learning about Amazon and then they’re learning how to find, oh, what products should you sell? And then they all end up on the same product. And so, this big school of fish, everyone was launching felt letter boards, which are, like, it’s a letter board that you can put letters on, right? You can say like, “Hey, welcome home,” or, “Congrats on the baby,” whatever it is.

And so, we did that whole bunch of work. And then we launched that product. And it was, you know, sourced from China. We had to go through all of that importing. You learn how to run a business really quickly with Amazon. And then you also learn that when a product doesn’t work, you have to let it go.

So, we learned that. And then my wife wanted to pivot to something more meaningful. And that’s where Wholesome Story came in. And so, she launched our first product. She did a bunch of research on, like, clinical trials and Amazon, kind of, like, what’s ranking, what’s not ranking. And then we found one product which was called Myo and D-Chiro Inositol. Have you ever heard of Inositol, Sean?

[00:18:56] Sean Li: No.

[00:18:57] Shinghi Detlefsen: Beautiful. That’s the exact product you want to launch. You want to launch something that’s a niche that’s not a lot of people know about. Like, I mean, so much of business is luck and timing. Somehow, the best sellers in that space had all gone out of stock. And when we launched the product, we basically went from zero to number one spot, like, bestseller spot, in, like, a month.

[00:19:21] Sean Li: Wow.

[00:19:22] Shinghi Detlefsen: So, in 2018, we were the best seller for Inositol. And in 2025, we are still far and away the best seller for Inositol. And we’ve grown with that category, too, over time. But fast forward, like, you know, 2017, she starts the business. 2020, it grew to the point where we could actually start taking money out.

And this is the other misnomer about business in general, and I’m sure you know this, Sean, is that when you’re growing, like, 100% or 1,000% year over year, every single dollar that you make from your business needs to go back into it to buy more inventory, right? You start with 5,000 units. And then if that was supposed to be for a year, and then the next year, you’re selling 25,000 units, you’re basically just reinvesting every dollar, and you can’t pull anything out.

[00:20:07] Sean Li: Correct. Yeah.

[00:20:08] Shinghi Detlefsen: And when growth slows down to, like, 50%, or 40%, or 30% year over year, you can actually start pulling money out because the business is, kind of, on a flywheel already. So, we had to wait for the business to grow to a point where… Again, this is me being my cautious self.

I didn’t want to jump in, stop my job at Amazon, which was a great job, high-paying job, and go to do this full time when I’d risk putting ourselves at bankruptcy or whatever it was. And so, 2020 was that time. I did the math on how much money we could pull out of the business. And it was greater than what I was making at Amazon. And then I de-risked that decision further by knowing that, if this business failed, I could go back to Amazon. That was my worst-case outcome. And I mean, that’s not a bad deal, right?

[00:20:53] Sean Li: Yeah.

[00:20:53] Shinghi Detlefsen: It’s like, if this doesn’t work, I just go back. And so, I went full time. I remember leaving Amazon. And, like, have you ever seen the movie Braveheart-

[00:21:03] Sean Li: Mm-hmm.

[00:21:03] Shinghi Detlefsen: … you know, when he’s screaming, “Freedom.”?

[00:21:05] Sean Li: Yeah.

[00:21:06] Shinghi Detlefsen: It wasn’t that I didn’t like Amazon. I had my dream job at Amazon. I had written that PR/FAQ document. I had gotten a team funded on my idea. And I was building that team. I was building that product. And I left all of that. And I remember leaving. In my mind, I was so happy because I had given 80% of my mind to Amazon. 80% of my thoughts were about Amazon, were about the products I was building for Amazon.

And now, I could take 100% of my thoughts and give them back to me. That was my mindset leaving Amazon. And it’s so true. It’s like, it was absolutely liberating. And building a business from there is, you know, you can work 1,000% more at Amazon, like, you could really just work your ass off, or any corporation, and you can get 10% more in salary. And in a business, you could work 1,000% more and you can make 1,000,000% more.

That, like, return on your time and your effort is so much higher in entrepreneurship if things work out than outside of it. And so, things worked out. And ever since then, it’s been, like, a beautiful experience. I mean, to have financial independence and everything else and time independence, it’s been everything we’ve dreamed of.

Also, you know, it’s not to say that there weren’t many challenges along the way. Like, there were. One of the biggest challenges, funny enough, was Amazon itself. I don’t know if you want me to go on that, but, dude, like, back in 2017, 2019, 2020, 2021, you either loved or hated Amazon. And that’s because, at the flick of a switch, Amazon could turn your business off.

[00:22:43] Sean Li: That’s right. Yeah. I experienced that. And I hated that.

[00:22:47] Shinghi Detlefsen: Every Amazon seller, like, that’s what you go to sleep stressed about was that. And again, I am a very, like, risk-avert… I mean, I’ll take risks, but I need to find a way, like, how do you fix that? So, I don’t like living in this place where, like, I can’t fix things that are broken.

And so, I said, “I’m going to go fix that, not just for myself, for, like, one Amazon seller, but literally for everyone.” And you would think that, after working at Amazon at six years, I have a lot of connections, or I could maybe go solve these problems myself. I found that I could not get any help for the problems my business was facing because that was a different kingdom than the kingdom I was in, right? And the kings are… they’re so vast at Amazon that, like, they don’t know each other. It’s completely, like, different worlds.

And that was when, like, I’ve just started posting on X. I had a friend who did a lot on X, or on Twitter at the time. And I realized that the only way to change this space was that you had to take all of the complaints and all of the issues that Amazon sellers had out of Facebook groups, these private Facebook groups, where somebody would complain, and instead of everyone trying to go fix the problem, everyone finds a hack for the problem.

So, it was like, “Oh, I have this issue.” “Oh, here’s the hack to get around that.” Or instead of, like, telling Amazon, “Hey, this is a problem. We need to fix it,” it was just hacks on hacks on hacks around the problem. And we realized that Twitter is the only place in the world, I mean, LinkedIn’s, kind of, like, this, too, but where you can actually post things and they’re public.

So, if you have an issue with Amazon or if you have an issue with Google or whatever other company, it’s public information. And it turns out corporations actually care about perception. And so, one day, Dave Clark, who was the head of… he was the CEO of Amazon retail. I was posting that I was on hold with Amazon seller support for, like, an hour. And when seller support answered the call, they immediately hung up. And I was really frustrated about that.

So, I posted it on Twitter. And he responded to that post. And he said, like, “Oh, our team’s going to look into it.” And then I immediately responded to him, and I said, “Hey, Dave. I’m an ex-Amazon employee. And I would love to put together a doc of all of the issues that not just I face, that we face as sellers and send it to you. Would you be open to that?” And he said, “Yes.”

So, I put my Amazon hat back on. I put my product manager hat back on. I gathered a bunch of feedback from, like, all the seller groups that I was in. We put the doc together. And we sent it to Amazon. I mean, that was, like, 2021 or something, 2022. They’ve fixed every single problem in that doc since then.

And then that built me a relationship with, like, the Amazon executive leadership team, where, like, even to this day, if somebody sends me an issue, I just pass it along to them, right? There’s a lot of people that will gatekeep relationships, where, like, “Oh, you know, pay me $10,000 and I’ll help you fix your issue.” I told that team, I was like, “Hey, from day one, I’m never taking a dollar. I will pass on anything I get from people.” And I just do that.

And since then, they’ve launched, like, the Amazon seller support handle on Twitter, which you would think was, like, “What’s the big deal?” but if your business was shut down by Amazon, the guy who had all of the control of reactivating your business, with some guy in a foreign country that you would never know and would never actually have dealt with your problem.

[00:26:07] Sean Li: That’s crazy. Wow.

[00:26:08] Shinghi Detlefsen: So, we built this public feedback loop with Amazon. And it’s been tremendous. Like, I think Amazon is an incredible company that has truly created more entrepreneurs than any other company in the world, has brought tremendous wealth to the world. I have qualms with the U.S. government and how we treat foreign entities that sell on Amazon.

[00:26:29] Sean Li: Yeah. I’ve read the whole thing on it. It’s crazy.

[00:26:31] Shinghi Detlefsen: Yeah. And I’ve written a lot on… I was in D.C. this week, literally. Do you know U.S. Trade Ambassador, Ambassador Greer?

[00:26:38] Sean Li: Yeah.

[00:26:38] Shinghi Detlefsen: He’s the guy with Scott Bessent going around the world. I met him, and I talked to him. I told him about this problem. I put on this mindset where, like, if there’s an issue, you don’t sit there and be a victim of that issue. You can go fix that. My mindset was that, if I could help fix Amazon, I can go help fix the government. And we’re going to do it, Sean.

[00:26:58] Sean Li: Really?

[00:26:58] Shinghi Detlefsen: Like, it’s happening already. Yeah. It’s happening already. Like, there’s going to be significant changes, I think, in the future to help level the playing field. We’re not asking for an unfair advantage towards foreign companies. We just want level playing field.

[00:27:09] Sean Li: So, yeah, to just give the listeners some context what, Shinghi, you’re talking about, yeah, you had written this whole thing that was shared with me, actually. And there’s this whole, kind of, conversation with Mark Cuban on Twitter that I found interesting, but it was this reality that sellers in China were able to sell on Amazon as a company registered in China, right? They didn’t have to register here.

They didn’t have to pay any taxes here in the U.S. And obviously, if their account gets closed or banned, they just go register another company and then keep selling. And I didn’t even know this was happening. I didn’t realize it, though, when I’m shopping on Amazon because, occasionally, there would be, you know, a lot of fake goods, right? I intended to buy this brand, and then it’s like another seller under that brand that’s selling me this fake stuff.

And the most egregious one I remember was I was buying these garlands, right, around Christmas time. I think the company was called Afloral. Yeah. That’s what it’s called. It’s called Afloral. And they sell these really high-quality, you know, like, invitation garlands. And then they sell them for quite a lot of money. I think it was, like, 150 bucks or something for just, like, a 10-foot stretch.

So, I found these five-foot stretches that were a fraction of the price, and they do make them. And so, I ordered it from under their brand, and then they were all fake. I spent, like, $200 worth, right? I bought $200 worth. And then, you know, I complained about it. I was asking for a refund. They immediately issued it and didn’t even ask to ship it back. And I was like, that’s, like, how crazy these fraudulent markets margins are, where they just don’t even care, you know. Like, they’ll just give you [crosstalk 00:28:53].

[00:28:53] Shinghi Detlefsen: They want to end it there. They don’t want you to tell Amazon about it.

[00:28:56] Sean Li: Exactly.

[00:28:56] Shinghi Detlefsen: [crosstalk 00:28:56].

[00:28:57] Sean Li: Like, they don’t even care. That’s how much of a racket it is. And so, yeah, once I read your article about how the foreign sellers are able to sell on Amazon again without paying any taxes here, nothing, just sell here and just have no accountability at all, just, I was like, wow. So, I’m really curious to hear, if you’re allowed to share, I guess, what’s in motion to alleviate that?

[00:29:20] Shinghi Detlefsen: Yeah. I mean, so, the core thing here is that when a selling account in the United States isn’t precious, meaning that you didn’t have to work hard to get it, right, you didn’t have to register, you don’t have a U.S. bank account, you don’t have U.S. insurance, you don’t have U.S. taxes, anything, you essentially have no liability.

So, what you have, what it turns into is actually a weapon. And it turns into a weapon that you can use to basically destroy competition. So, for instance, like, you know, if you have a business on Amazon, Sean, and I want to compete with you, I could do, like, a one-star review attack on your listing. And I see this literally every day from my peers and my friends.

And that’s just dropping your listing down. And when you have lower stars, especially when you go below 4.2 stars, your sales just start tanking. And all the while, they’re launching products, and they’re doing fake reviews, so they have all five stars. So, now, it’s, like, a five-star beautiful product versus yours, which just looks horrible with your one-star reviews. And guess who wins?

The guys who cheated. They win. And Amazon may cash them in the process, and they’re decently well at doing that. And then they get taken down, but then they can just… again, they have nothing precious about that account. It just comes right back up. And they do it again. And they can keep doing it again relentlessly, endlessly, forever. And so, what we’re advocating for…

Well, and I’ll just take a step back. So, Sean, if you were in Main Street America, even in Berkeley, right, like, say, there was a Chinese competitor at Cheese Board in Berkeley, and that Chinese competitor had taken a Molotov cocktail and thrown it into Cheese Board and burned the business down, and then opened a pizza place right next to it, right?

That’s the equivalent of what’s happening when it’s online. You know, it’s not making news or headlines, but these small businesses, that’s the equivalent of what’s happening to them. They’re getting firebombed and they’re getting absolutely destroyed. And the FBI, no one’s involved because it’s just like… I don’t want to say it’s hush-hush, but it’s like, if a tree falls in the forest and nobody’s there to hear it, does anyone hear it, right?

[00:31:15] Sean Li: Right.

[00:31:15] Shinghi Detlefsen: It’s like that’s the equivalency. So, what we’re advocating for is we want a level playing field. We’re okay with foreign competition, but we want foreign competition to operate the way U.S. competition has to operate. And that means that you have to register your business in the United States.

And even before I go to that, we’re looking to go to Mexico. For me to sell in Mexico, I need to have a Mexican LLC, a Mexican bank account, I need to pay income tax on the profits made in Mexico, right? All of those things, what I’m going to start selling there, it makes everything precious because I don’t want to go screw over Mexican companies because I’ll lose all that, right?

[00:31:49] Sean Li: Right.

[00:31:50] Shinghi Detlefsen: There’s some risk there. So, we’re advocating for that exact same thing, but in the United States. So, if you want to sell here, register, pay taxes, have liability, have a U.S. bank account, have a U.S. insurance. That’s it.

[00:32:03] Sean Li: I’m shocked that that doesn’t exist, right? s it just a loophole in Amazon? Like, I guess, why isn’t it Amazon’s issue?

[00:32:11] Shinghi Detlefsen: So, Amazon’s not doing anything wrong. They’re abiding by the laws. And if they didn’t do it, someone else would, which is what, like, the Temu and Sheins, they tried. And they’re gone now because de minimis was killed. But the core reason behind it, and I did so much research on this, like, and thank God for AI because AI was so helpful here, is that in the U.S.-China Tax Treaty, and this is a tax treaty that’s very common with many other nations, there’s one clause which establishes something called permanent establishment, P.E. And in order to have permanent establishment, you essentially need to have offices in the United States.

So, you need an office, and you need, like, an employee. Okay. You have permanent establishment. Amazon FBA gives you everything but that. So, you have fulfillment, you have shipping, you have sales, you have marketing, you have everything but permanent establishment. So, when there’s no permanent establishment, there’s no need for registration, you’re subject to a tax treaty, off you go.

[00:33:05] Sean Li: Interesting.

[00:33:06] Shinghi Detlefsen: Yep. So, we’re going to change that.

[00:33:08] Sean Li: I mean, that tax treaty is pretty outdated, too, right?

[00:33:11] Shinghi Detlefsen: It’s from the ’80s. Yeah, exactly. I mean, Amazon wasn’t there, like… But this is the problem with the U.S. government is, like, we’re so far behind. And, like, even the bureaucracy of, like, to change something is so problematic that… And remember, who is the United States competing with? Like, there’s foreign countries. Like, China’s a good example.

China’s a communist country, and it’s, kind of, a dictatorial communist country in that one leader can direct the whole nation. Sean, imagine you’re competing with somebody who has the power to completely direct their company, and you’re stuck in this bureaucracy where, to change the direction by a 10th of a degree, you need to go through all of these layers, right?

[00:33:55] Sean Li: Right.

[00:33:55] Shinghi Detlefsen: So, you are unable to react to the ability to what the Chinese Communist Party and Xi can do in any reasonable amount of time that doesn’t cause significant harm to the businesses. So, the conference I was at, like, there was a room full of, like, manufacturing people, brand people, trade people, incredible salt-of-the-earth people, a few billionaires and everything. And literally everyone had the same problem that we, as Amazon sellers, had. Again, I don’t blame any other nation. I don’t blame anyone. It’s just like, we just need to have fair laws. Our laws need to catch up to our times. Otherwise, like…

[00:34:33] Sean Li: People are going to take advantage of it. 

[00:34:34] Shinghi Detlefsen: Yeah. I mean, has the U.S. taken advantage of other countries?

[00:34:37] Sean Li: Yeah.

[00:34:38] Shinghi Detlefsen: Heck yeah, right? So, the laws, you have to do it. Otherwise, people will take advantage of it, so.

[00:34:44] Sean Li: Right. Absolutely. Oh, no. This is a fascinating conversation. And thank you for sharing this tidbit. I was hoping you would-

[00:34:50] Shinghi Detlefsen: Sure. Yeah.

[00:34:51] Sean Li: … because it was so revealing when I read it. Was there anything that I didn’t get to ask who that you want to talk about or share?

[00:34:57] Shinghi Detlefsen: I think the only thing, like, if I had to give a lecture at Haas, right, to undergrad or even MBA, I would focus on aim to be a millionaire, not a billionaire. And I think, again, going back to that barrier mindset where, like, you have the Googles and the Facebooks and that’s who you want to be growing up, that’s, like, a one-in-a-billion chance of you hitting that, right?

And a lot of people will spend a ton of time, they’ll do a startup, they’ll raise a ton of money, and they’ll be diluted to the point where they would have been better off becoming a millionaire. And so, like, my point everyone there is that there are million-dollar opportunities everywhere. And it’s simple.

Like, you can create a million-dollar business, and you just take a problem, a small problem, and you solve it. It doesn’t need to be a problem that you solve for the whole world, right? Like, Facebook solves connectivity for the world. You don’t need to do that. You could probably walk into any, like, especially, like, mom-and-pop businesses or, like, if you think of software, get to know a niche of people and figure out what is their problem that you could solve through software is a simple example. Go and solve that problem.

And then sell that software back to those people. And so, like, if I had a mindset shift myself, I wish I focused more on that as an undergrad, even, like, you know, later on in my career. I’m glad I went through the corporate life. It taught me a lot. That’s been tremendous. It’s been a great asset to have as an entrepreneur to have a corporate background, but you don’t need it either. That’s the other piece.

[00:36:30] Sean Li: I agree.

[00:36:32] Shinghi Detlefsen: Yeah. And then, you know, the last one, too, is that if you are running a business, buy yourself out of the business as fast as you possibly can. So, again, a lot of people, especially entrepreneurs, they have this mindset where everything needs to go back into the business, but if the business fails, you have nothing, right? And I like to de-risk myself. And we de-risk ourselves by you pull money out of the business and you buy yourself out of the business.

[00:36:57] Sean Li: Sorry. How does that work?

[00:36:59] Shinghi Detlefsen: So, it basically means that you pull enough money out of the business that it’s as if you sold the business maybe for not what it’s worth today, but for what it was worth three years ago or whatever, right? Like, we were offered $3 million for our business a long time ago. And I was like, “Holy shit. That’s, like, done. We’re done,” you know. And then a couple years later, like, that’s not done. But if you pull $3 million out of your business, then it’s as if you sold it, but now you still have the asset.

So, that’s what I would encourage people to do. You know, if you have a great cash flow in your business, you can do that. If you don’t, work on that. Yeah. Pull money out of the business. And then, like, you know, I started a software company as well. And the problem that I solved was my own problem. And it was data analytics about customers, customer analytics.

And again, this is where, like, you can see million-dollar opportunities because they’re usually the problems that you face in your own life. And if you have the skills and abilities to go solve them, you have now created a business that is worth millions of dollars. So, that’s the other thing is, like, if you find something that you’ve encountered or you’re stuck with or, like, is annoying… I’ll give everyone a free example. I have a million credit cards.

It’s not because I like debt. We treat them purely as arbitrage for points and for cash back. I don’t know what credit card to use for what store to maximize my cash back. So, you want a million-dollar idea? Build a little app that’s either using geolocation or is connected to Apple Pay, that when you’re about to go pay at Costco, it says, “No, don’t use that card. Use this one.”

[00:38:31] Sean Li: That’s right.

[00:38:31] Shinghi Detlefsen: And you maximize cash back. There’s a million-dollar idea right there. Like, you can take any little problem that you have, and you can go solve it. That’s the beauty of what we live in.

[00:38:40] Sean Li: I totally agree. I love it. I wish we had more time, Shinghi. This has been a really insightful, just interesting conversation. Thank you so much for taking the time to come on the podcast. Love to have you back.

[00:38:52] Shinghi Detlefsen: Thanks, Sean, for having me.

[00:38:56] Sean Li: Thanks again for tuning into this episode of the OneHaas Podcast. If you enjoyed our show today, please hit that Subscribe or Follow button on your favorite podcast player. We’d also really appreciate you giving us a five-star rating review. If you’re looking for more content, please check out our website at haas.fm. That’s spelled H-A-A-S.F-M. And there, you can subscribe to our monthly newsletter and check out some of our other Berkeley Haas podcasts.

OneHaas Podcast is a production of the Haas School of Business and produced by University FM. Until next time. Go Bears!This episode of OneHaas is brought to you by the Haas Fund, fueling opportunities for our students, faculty, and strengthening our Haas community. Join us in making an impact today at haas.berkeley.edu/give.