[00:02] control because these two guys started an AI white-label drop shipping store and used an aggressive Facebook ad strategy and influencer marketing campaign to scale a brand new store from zero to 1.8 billion dollars in just over
[00:18] two years. Now, this is where things get ridiculously crazy. They were selling a weight loss product and they were running over a thousand Facebook video ads and the video ads that they were using were fake AI UGC creators. They
[00:33] weren't even real people or doctors promoting the weight loss. These two guys that run the store are getting a lot of heat online. They're also being to make it very clear what you shouldn't
[00:45] case study. I've also created a comprehensive timeline and storyboard of everything these guys have done from the start to the very end to help you guys fully understand and help you to learn as well. So, if you guys want to get
[00:59] access to that timeline storyboard, which is full of value, make sure we hit video and then it'll be in the pinned comment and in the description below. So, this is the white-label drop shipping store that generated 1.8
[01:12] billion dollars in just over two years and this is one of the guys that was running the store. Now, the product that made them all of this money is the GLP-1 weight loss. Now, the Ozempic thing started this trend. So, everyone was
[01:26] loss, but the problem is people were dying from taking it and people also getting crazy side effects and then the hype moved to GLP. People are getting they want a quick fix. So, everyone jumping on this GLP-1. And this guy
[01:40] basically created an AI business out of it and just scaled it to the moon. Now, skeptical saying, "Well, how do you know these numbers are real?" There's too many big credible sources that have spoken about it. Forbes also wrote about
[01:52] were given here, their revenue, their run rate. You can see 1.8 billion and it called Hims and Hers. So, you can see all there. Now, if that wasn't enough credible sources, guys, the FDA also wrote about it, which is a government in
[02:08] the US. They also spoke about the company and everything about it like the violations it's done and etc. So, like I said to you guys in the intro, although numbers they've done, some of the stuff was misleading and not ethical, but we
[02:22] it into our own stores, which I'll be getting on to a little bit later. Now, this is another company selling literally the same type of products and they're called IM-8 Health and it's also another American company. Now, they're
[02:35] having any issues, they've not been sued. And these guys generated in the sued. And these guys generated in the last 30 days between 1.4 and 2.2 million you one of their competitors to show you how lucrative this market is at the
[02:50] moment. And it just proves that once you find a winning niche or a winning product, it doesn't matter what you do, it can just scale really aggressively. step-by-step guide, let me show you the market in they were doing. So, you can
[03:03] see here, this is a post off Twitter or X and they were running ads on Facebook with fake doctors. You can see here called Dr. Daniel Hayes, you got Dr. Taylor Moore. These are fake doctors, AI doctors, and they were getting videos
[03:15] promoting it. So, they weren't running it off their page. You know how usually from an e-com brand or a drop shipping store, you'd run your ads off your page. These guys were making up fake pages in the name of doctors and running the ads
[03:27] credibility cuz you got to think of it. you're going to trust it more than a consumable brand like, for example, the example. So, that was one of the ways
[03:41] were making lots of fake doctor pages, Dr. Aris, Dr. Sarah, Dr. Jonathan. Now, this is where it's completely unethical and you shouldn't be doing it like this. into a lawsuit, but I'm going to be showing you guys how you can avoid all
[03:56] way and not get into trouble like this either. So, guys, before I get into the next part of today's case study, I wanted to make a quick announcement. If mentoring, we're not talking about group mentoring, we're talking about
[04:09] one-to-one mentoring for your e-commerce and drop shipping experience, then people that reach out to me on Instagram have one-to-one mentoring? Can I work with you?" Then yes, guys, I do offer a
[04:24] one-to-one mentorship. And it isn't just any mentorship. We've been offering mentoring in the drop shipping space now for over seven years and our track record is proven. We have some of the most successful students that have
[04:36] graduated from our e-commerce mentorship. We're one of the only few mentoring and we're one of the first companies to ever do it. So, if you're you with your drop shipping store, taking you from the very beginning,
[04:50] store, launching the ads, having an accountability partner, feeling like you have the confidence to run your store without worrying about, "Am I doing it right? Am I doing it wrong? How do I find the little gems about how to do it
[05:03] correctly?" Your mentor will figure that out with you. He will turn you into a drop shipping professional within 30 days. I can guarantee that the mentoring that we offer in our company is the highest quality of education in the
[05:17] much about the mentoring, guys, but I know a lot of you guys have been asking one-on-one mentorship, there'll be a link in the comment and there'll be a QR code on the screen so you can apply. But before you apply, guys, only apply if
[05:31] you're serious and you have a good budget. We only want to work with people budget so it doesn't slow them down through the process. Our most successful students have always been the ones that have the correct mindset and they have a
[05:45] budget to spend on ads. Now, if I was to guess, all the available spots for the one-to-one mentoring for Q1 will be fully booked by the end of the next two you can join, make sure you apply by scanning the QR code or clicking the
[05:59] link in the description before it's too late and we reopen for the next quarter. back into the video. Okay, so now I've quickly painted the picture of how this all worked, let me break it down. So, these are the insane numbers of how they
[06:12] these are the insane numbers of how they went from $20,000 to 1.8 billion in eight months. In September 2024, they launched the brand. Matthew Gallagher, who's 41, builds it from his house in LA. Zero employees, zero funding. Then
[06:25] in month one, October 2024, they got 300 customers. In month two, they got 1,300 customers at a 4x growth rate. In 2025 full year, they hit 401 million in
[06:37] revenue as a teeth health rocket ship. In January 2026, they get a data breach and they get basically sued. In 2026, they get an FDA warning. And in 2026, they get a run rate of 1.8 billion revenue at a 16.2
[06:54] margin, which means they make 65 million in profit, just the two of them. little bar chart showing how quick their success was. And the reason why they had no employees is because they were doing it all with AI. And this is really
[07:08] company, it's a drop shipping with a white coat. That's essentially what this used. They had their store, which is this one here. This is their storefront that they would use for you to buy it. So, for example, you click get started,
[07:22] you get am I qualified, you go through this simple weight loss form, and then the middle layer is their partners, the partners that do all the questionnaires. fulfillment, so they're not fulfilling this themselves. They're literally just
[07:34] running you to a landing page and then their partners are fulfilling the orders. So, you can see here, this is the landing page, finally serious about weight loss, so are we. Fat loss made easy with personalized care and GLP-1
[07:47] medication. No memberships, starts from just $179. No insurance required, free shipping, HSA approved, and FCA approved. Then if you scroll down, they've got all of their different options in GL1
[08:00] injections. You've got the pills, you've got the tablets, and you've got here the injection as well. Then it says, "When nothing else worked, Mediv did." And weight loss and it'll show you how much weight loss potential you have. And
[08:13] AI. Look how obvious these are. These page, by the way, was also made with AI. the process works. You fill out the questionnaire, you get approved, then
[08:25] you get prescribed by this fake doctor, and then you receive your package. And then it shows another fake doctor and another fake actor. So, essentially, they were just running loads of ads to this landing page. Now, I've actually
[08:37] done a lot of research and found out all of the cost that they were charging people based on injections, tablets, and the compound and the other drugs they were selling. So, you can see $179, $249, $279 a month, and then a $99
[08:52] membership for the pills. So, you can see all of that information clearly there. Then these are some of the live claims that they made. Now, the FDA remove them. So, like six more weight loss than exercises at diet loan, we
[09:06] will fix your broken metabolism, hospital grade power. So, yeah, some of these claims are just wild and outlandish. Now, let me talk about the full AI stack that they used to build this. Now, in terms of their website,
[09:18] it's not built on Shopify. So, this isn't a Shopify website, by the way, guys. This is a custom-built website, in my opinion, built with AI. They probably used Claude and a bit of chat GPT to build this.
[09:31] You can use Claude code now to build a website like that in like two minutes. Then for the marketing and creatives, they either used Midjourney, Eleven Labs, Runway. They probably used AI models like Kling, Sora, V03 Fast, V03.
[09:47] And then operations like customer chatbots and agents, they would have have used something like Tidio Live Chat or one of the AI models. But if you just look at their website, all of these images are made with AI. Again, either
[10:02] Midjourney, Google Banana, one of them is the option here. Now, this part is the bit that made them all the money, which is the 800 plus fake doctors in ads, and this reveals everything. They have over 800 ads running right now from
[10:18] fake doctors, fake medical centers, and another 4,000 running with fake testimonials. I've actually live data here on the ad library. So, you can see I searched for Mediv, their company name, and you can see all of these ads
[10:33] from the Wellness Access Center, and you can see here it says the drug name is now available for just $149 a month with no hidden fees, no surprises, get straightforward pricing and shipping at the lowest price guaranteed. Now, if I
[10:48] where it's going to take me. Oh, wait, it's took me to that same page, but now So, obviously, they're running a different URL. You can see the URL here
[11:00] see it's totally different. So, they're running these special offers based on the landing page. Then you can see another ad from them here, which is again for another drug they're
[11:13] And if we scroll down, this is where things get interesting. Lose weight with things get interesting. Lose weight with real GLP-1s from $179 a month. But if we real GLP-1s from $179 a month. But if we watch this ad together, check this out.
[11:36] clearly an AI overweight woman. And look at how bad this AI video is. Those are running. Then you've got another ad here. So, let's check this one out.
[11:59] quick dramatic effect. Some woman has put trousers on, they finally fit, she's happy. It shows the website of where she got the weight loss drug from, which is more, it's going to take us back to that landing page. But you can see here,
[12:13] guys, there are more and more ads. So, look at this one. Take control of your health. This ad here is trying to show some form of woman that's got a result from it. But yeah, it's just ad on ad all from the same people. If we learn
[12:27] landing page, but check this one out. This one's from Allison Taylor. So, the ad's being run from this fake page called Allison Taylor. And look at the Even looked up the difference between GLP-1, Ozempic, Zepbound, tirzepatide,
[12:44] and all these names. This one, tirzepatide from Mediv, is specifically for weight loss, and it's far less dramatic than I thought. I mean, first it was all diabetes medication that people used Now, that video is
[12:57] clearly an AI avatar doing a voiceover, showing the product and how much benefits you get from it, etc. That's another example of their AI ads. You've got other ads here again of an AI avatar, more AI images. Pretty much, I'd
[13:11] say 80% is all AI. Now, although this is crazy and very unethical, what you can do and take away from this if you want to use this in your own drop shipping store is scale aggressively off loads of accounts. A lot of drop shippers think
[13:26] you should only use one Facebook page to launch ads from. If you've worked with influencers on your products, you can say to them, "Look, if I pay you $500 to promote the product on Instagram, can I also pay for you to run them as an ad?"
[13:40] So, I will give you the $500, you run the ads off your page, you're going to get followers because you're running ads to your page with the ad on it, people will follow you. So, the way you can do it is you can get influencers to run the
[13:54] look more trustworthy than if it's coming off a page like this where it's actually the actual page name. If it's coming from the influencer's page, it's one of the strategies that some of the biggest drop shippers do. They actually
[14:07] run ads from the influencer's pages, they give them the money to spend, and that's one way if you want to go advanced and really scale aggressively, you can. The other thing that you can learn from this is image ads are really
[14:21] it really important, and all of these are done with AI. AI avatars also incredibly powerful right now, as you can see based on these ads. So, if you haven't already, you can scale aggressively just by using AI
[14:34] them so successful, how aggressive they were with scaling with AI creatives, and product. Now, if you're not sure how you can make AI avatars, you can come over
[14:46] link in the description and in the pinned comment, and you'll get a discount. You can sign up, and once you've signed up, guys, you're going to click new folder. You can call this project AI. And then what you can do is
[14:59] you can go to talking actors. You can click add actor. You can actually create your own actor, or you can filter it. Let's say I want a male. I want it in HD. Then I can choose any of these actors to say what I want. So, I select
[15:12] the actor, I give them the voice note. Look, this is the funny part. You can actually select AI doctors in here. Maybe they also use this as well, I don't know. But you can select the doctor, click add actor, and then you
[15:24] can give it the script, and this AI avatar will say what you give it. Now, in the past where I was drop shipping rose teddy bear, and I got this AI actor to basically promote my rose teddy bear. So, you can see this is the AI actor,
[15:39] and this is the video of her promoting the product. So, you can see her talking to the camera with the product. So, this is exactly how companies like Mediv are using AI actors to promote the product. So, basically, you can do all the AI
[15:53] actors and avatars using Ark Ads, and it gives you unlimited accessibility to scale as aggressive as you want. And they don't just have talking actors, you can also create videos using all of the models now. So, you've got VO3, you've
[16:05] got Sora 2, you've got Kling, so you can create them all using Sedans. Just to show you some examples of the image ads that you can make, you can all do them image ads here. So, Ark Ads is the all-in-one solution
[16:18] if you want to create anything AI creative in terms of videos or images. pinned comment or in the description below. Now, if we take a look at one of their biggest competitors called I Am A Health, you can see they're running the
[16:31] same type of ads. Every nutrient your GLP-1 diet depletes, zero nausea, zero triggers. So, you can see they're running ads of the same type of product, which is don't let weight loss cost you strength. And you can see they've worked
[16:45] with big people like David Beckham. They're using athletes as a way to promote the product. Now, these guys are doing it a lot more ethical, and they're working with big people like you can see MMA fighters like Dustin Poirier here
[16:58] promoting the brand. So, they've gone down the more ethical way of doing it. working really, really well. Now, in February 2026, the FDA came knocking. So, the FDA sent Mediv a formal warning letter. This is not a slap on the wrist.
[17:14] This is warning letters are public records. They trigger mandatory response and deadlines. Now, I've given you guys the link to the letter here, but the actual three violations were misbranding of false compounder identifier,
[17:27] compounding identity. Mediv's website showed Mediv a breach labels on compound drugs implying Mediv was the compounder. It is not. Open loop partner pharmacies essentially, this is where they're getting told off because they're saying
[17:43] that they're a brand called Mediv, but the drugs that were given were not from them. It was from Open Loops, which is essentially them drop shipping the product. Then there's false FDA equivalent claims. Website claims same
[17:56] active ingredients as Wegovy and Ozempic and the same active ingredient in Mounjaro and Zepbound implying FDA equivalent safety approval that doesn't exist for compounded drugs. Compounder drug advertising violations under the
[18:11] FDCA, advertising for compound drugs cannot be did. They've basically got 15 days to respond to all of this information. And that's why as a drop shipper, as an e-commerce brand, it's not worth making
[18:25] false claims, false statements, because eventually it will all come back and to do everything ethically from the start, cuz you're then not going to be hit with any of this. And the thing is, these guys generated 65 million in
[18:38] lawsuits, they're going to lose all that profit. They might be left with a small day, they're going to lose a lot of their profit because they went around all of these misclaims. Now, in January 2026, 1.6 million patient records were
[18:55] exposed. Personal information and medical information. And this is a big issue because it wasn't Mediv that had the issue, it was Open Loops data security that was the one that got breached. And this is a fundamental risk
[19:08] of drop shipping model. Your partner is your breach of contract because if your supplier has all of your customers' names, all of their data like their address, everything, and they get breached, not you, you're still going to
[19:22] get into trouble. So, Open Loop made a big mess up, and now it's cost Mediv a lot of money because their data got breached. But remember, the data from Loop because it's the same customer data being shared. They're the supplier, they
[19:36] get given the addresses, the names, all of it. Also, additionally verified there was deep fake patient photos. So, this is also a massive red flag. Now, Mediv's insane, and they're insane because of their unethical practices that allowed
[19:52] compare it to Him's and Hers, you can see here the revenue is crazy. The actual net margin is also huge. The revenue per employee is obviously massive. Outside funding is zero. They had to raise $1.5 million.
[20:07] Time to $1 billion took them 15 months. It took Him and Hers 6 years. Now, this is five ways that this store will collapse. Number one, the platform and fee squeeze. Care Valid or Open Loop raises their fees, margins
[20:21] were making is no longer there. Number two, competitor replication. Now, this has become a mass story online. Everyone's heard of this now. There's going to jump in and create competition. Number three, regulatory shutdown. The
[20:36] FDA doesn't like the response they give them, they shut them down. That's that done. Back end exit. If Care Valid or Open Loop launches their own consumer brand, then why would they need Mediv? Number five, platform de-platforming.
[20:51] Facebook, Google, and TikTok could ban them because of this lawsuit, so it marketing. So, there is a lot of ways that this brand can now collapse. So, mention whilst I'm here is the opportunity of subscription models and
[21:07] supplements for drop shipping. This has become one of the biggest opportunities right now. A lot of the biggest drop shippers or e-com guys are now doing subscription models and they're doing supplements. Now, five things that you
[21:20] guys can steal from this store. Number one, high LTV subscriptions and zero inventory equals massive margin. The reason a 500 to 700 CAC works is because customers pay $200 to $300 a month forever. In standard drop shipping,
[21:34] you're lucky to break even on CAC. The subscription model changes everything. This is why drop shipping subscription models, drop shipping supplements has become so big at the moment because the CAC is so big and it works. White label
[21:48] back ends are under under a short in e-com. The next thing is first mover in a red hot category. GLP drugs, weight loss drugs is a massive hot niche at the moment and they were able to break big within a hot niche. The next thing is AI
[22:04] right. So, if you know how to use things like Open Claw, Clawed Code, Manas AI, just all of these different tools correctly, then you can scale massively at creating landing pages, video ads,
[22:18] to do it ethically. You're not going to do it unethically. A lot of people are one of them and now it's got them back. The next thing is speed. The way that these guys were able to launch this store with just 20K and scale it with
[22:31] the AI is crazy. Now, four things that can get you sued or arrested that I would say you should not do, guys. Number one is fake doctors in ads. That is just a complete no-no. Implying FDA approval for non-approved products.
[22:45] Claiming regulatory status that you don't have. And relying on regulatory exception that's closing. So, guys, whenever you're drop shipping, please make sure you're not doing any of these cuz you're asking for a lawsuit. So,
[22:58] for you, I've gone over loads of other hooks, how you can take what they did in terms of the way they were doing their video hooks and scripts, and how you can do it, their video structures. I'm even
[23:10] going over their thumbnail concepts, their video and SEO descriptions, their ads have been deleted, I've actually hard put them into this whiteboard so you can see them. I've got the copy template used across 800 accounts, so
[23:24] basically, all of the information they guys. I don't want to bore you with it anymore, but everything, and I mean everything, is on here. All the links, everything like resources on here. But,
[23:37] the moral of the story is drop shipping or e-commerce with AI is a game changer. The fact that you can scale aggressively because of creatives, websites, images, the lot can be done so quick now by using things like Clawed Code, Manas AI,
[23:52] whatever it may be, is massive. You can scale your product to the market quicker than ever before. You can create a marketing campaign like never before. talking about, partner with influencers, run ads off their accounts, tell them
[24:06] you're going to be able to scale more aggressively. Use image ads and AI avatars for your ads. But, at the end of the day, guys, this just shows you, unfortunately, although this is a crazy impressive case study, it was led all on
[24:20] unethical practices that bit them in the end. But, we can still take a lot of positives from this in terms of the marketing strategies for our own drop shipping stores. Please do not watch this and think I should run it the same
[24:33] the end. But, with that being said, guys, I hope you've enjoyed this video case study in the comments section below.