Amid Headwinds, SpyGuy Doubles Down

Allen Walton first appeared on this podcast in 2020. His company, SpyGuy, an online retailer of surveillance cameras, had been banned from Google Ads. He was scrambling for new sales channels.

Google eventually lifted the ban, but SpyGuy continues to face headwinds amid rising competition and shrinking margins. Still, Walton perseveres. He has doubled down, with a renewed focus on revenue, customer service, vendors, and more.

He and I recently discussed his journey. The entire audio of our conversation is embedded below. The transcript is edited for clarity and length.

Eric Bandholz: You’re back on Google.

Allen Walton: Yes. We were banned from Google Ads in 2018. Google said our products encouraged dishonesty. That was our main source of traffic and sales. It scared me quite a bit. I had that looming over my head for a few years.

It forced me to rethink this business and how I’m going to run it. It made me dive into the details and understand how things worked and how much of our sales came from Google Ads.

I ran the numbers and decided I could make it work, but I would be involved and change how I do everything.

I’ve considered making TikTok videos where we show people how hidden cameras work. What does it record to? How do you find a GPS tracker on your car? How do you put a GPS tracker on a car? I think folks would find that interesting. I want to get into TikTok, but I have a big hangup with videos.

Apparently, other videos on TikTok refer to SpyGuy. Many people have told me they see our company there.

Bandholz: Why did you commit to the brand and not give up?

Walton: That’s a good question. I got in the space in 2009 and worked for somebody else till 2014, then started SpyGuy. I’ve done that ever since. The first year was awesome. Looking back at it, it was hectic. I started my own company, and people are ordering stuff. And then the next three years or so were terrific. It was easy. The margins were much better than they are now.

When the Google Ads banned happened, team members randomly disappeared, or their work quality dropped. I realized I wasn’t serious about this business, and I have to be because I wanted to exit it and get paid for the work that I had done up till that point. I had to make this work, or I would regret it for a long time. It was a mindset shift.

Still, things started getting harder at the beginning of 2019. Having my first kid threw me for a loop. I took my eye off the business. Folks were taking advantage of me, vendors not being very pleasant to work with, and I had chronic sleep deprivation. We had another kid during Covid. It was a hard grind, and I didn’t take it well. I was in a car wreck, and then my wife had back surgery as well. I ended up going to therapy.

There have been a lot of failures in the last few years. I got into things I didn’t understand fully, such as hiring an agency for Facebook Ads, even though I’ve never run a Facebook ad myself. I ended up losing a ton of money. Being bootstrapped, spending $30,000 on Facebook ads one month is not a great idea if it doesn’t pay off, and it didn’t.

Over the years, I’ve had minor revelations about improving on this or that. But I never really had my feet to the fire. Money wasn’t the motivator for a long time. Now it is again. I own this business and can’t take as much time off as I was previously. I need to focus and understand my numbers.

Bandholz: How many SKUs do you have?

Walton: About 30. I’m learning more about what customers want. Unfortunately, there’s not a lot of innovation in the space. Many people who make these items don’t come out with new products. Having new products to sell to existing customers is a huge source of revenue.

Everyone assumes hidden cameras are for nefarious reasons. But the vast majority of our customers are just regular people. They’re watching their toddler. They’re not sure if they trust the babysitter. They are being harassed at work, and they want proof.

Plus, our customers include reporters, investigative journalists, and even law enforcement. I can search in Shopify and see prominent media outlets as buyers. We get calls from the FBI asking for advice on GPS stuff. It’s very interesting. It’s very legitimate. Some people might use our stuff for illicit purposes, but I can’t control that.

Bandholz: Where can listeners reach out?

Walton: Go to SpyGuy.com. My Twitter is @AllenThird.