Investor:Robert Herj with Shark Tank Appearance:Feb. 24, 2017 Offer:$200,000 for 15% stake Results:Sales increased from $1.6 million to $2.7 million in four months.
For three millennials and best friends, the journey to launching a multi-million dollar beach lifestyle business began at a San Diego call center where they sold life insurance. There, in 2013, college roommates Steven Ford and Brandon Leibel met fellow insurance peddler Bruno Aschidamini.
Four years later, the trio appeared on Shark Aquarium , the ABC commercial reality show, and they got offers from Mark Cuban, Kevin O'Leary and Robert Herjavec for their Sand Cloud beach towel business. Today, with Herjavec as an investor and mentor, the buddies are on track to achieve $7 million in revenue by the end of the year.
Leibel shares his thoughts on the how friends were able to withdraw their business.
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They went all-in.
In 2014, the three of them quit their jobs to focus on building Sand Cloud together. To save on rent, Aschidamini gave up her apartment and slept on the floor of the two-bedroom loft that Ford and Leibel shared. They ate rice and beans for a year. They sold almost all of their furniture. Aschidamini and Ford sold their cars. Leibel kept his so he could work as an Uber driver. They borrowed money from their families and used their credit cards to the max. “We never thought about failure,” says Leibel. “We never worried. We operated on blind faith, and we were young enough to be able to afford to take this big risk.
They persisted.
“Our work in the call center taught us how to deal with rejection,” says Leibel. "We were each making 300 to 500 calls a day, and 95% of the people we contacted told us to take them off the list." So when they started walking down the beach and presenting their towels to sunbathers, the guys didn't flinch when faced with blank stares.
They held on to hope.
For the first two years, the partners barely paid attention to how many towels they were selling – or rather, not selling. Instead, they focused on building a social following. “Our mission was to gain 100 subscribers a day,” says Leibel. “To stay motivated, we would have contests between the three of us on who could gain the most followers. They sent their Turkish beach towels to influencers, and they handed out business cards wherever they went with a picture of the towels and their social media handles. Leibel wooed his Uber riders to like Sand Cloud on Facebook and follow the company on Instagram.
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They could swing.
The brainchild Ford and Leibel came up with was a beach towel with a built-in pillow for easy napping in the sand. In January 2015, the guys took their pillow towel to the Surf Expo show in Orlando, Florida. Shoppers at the show continued to comment on a towel sample with a blue mandala pattern that they had hidden in the corner of their booth. Surf-wear company Quiksilver has ordered 400 mandala towels for its retail stores. Meanwhile, the pillow towels turned out to be a nap. As the sales of Decorated Towels increased and the Pillow Towel continued to fill up, they decided to focus exclusively on Pillowless Towels.
They had a mission.
From the start, the guys shared the vision of becoming the TOMS of beach products, striving for the social impact of the famous buy-one-donate-one shoe company. Sand Cloud donates 10% of its profits to organizations that support marine life and clean oceans, including the Marine Conservation Institute and the Surfrider Foundation. “We've always admired TOMS,” says Leibel. “We are passionate about protecting our oceans. Participating in activities such as releasing rehabilitated sea lions into the ocean or participating in beach cleanups has personally changed the three of us. A small example is that we never walk on the beach without picking up trash. »
“We never worried. We operated on blind faith, and we were young enough to be able to afford to take this big risk. »
They test the market religiously.
“We review everything, whether it's a new product or a new design for a towel, through our potential customers,” says Leibel. Sand Cloud will soon start selling yoga towels. The thousands of upvotes they received when they posted mockups of the towels on social media convinced them that there was a receptive market for this new product category.
One thing the trio untested in the market is the decision to remain primarily an e-commerce business. Although Sand Cloud towels are sold in about 100 stores across the country, 95% of sales are generated from its website, and partners have no interest in opening physical stores. “Robert Herjavec, who has a lot of wisdom and experience, has had great success with online retailers,” says Leibel. “He validated that the web is the way forward for us. That's all we needed to hear. »
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This article originally appeared in the October 2017 issue of SUCCESS magazine.
