Shaun Neff, Founder, Neff Headwear
Extreme Branding with Shaun Neff – How some beanies and a sharpie turned into one of the hottest brands in clothing
Beanies, caps, eyewear, tees and tops, watches, snow accessories, backpacks, hot tub shorts. You name it, Neff rocks it.
So how did Shaun Neff, founder and namesake of the California-based clothing company, skyrocket this global apparel giant from his humble backpack into the big time? By keeping it real, staying rad and being an insanely astute businessman.
On the surface, Shaun Neff might seem like just another hip, down-to-earth cat — but don’t be fooled. The 35-year-old Californian native is as sharp as they come. He’s also a lifetime opportunist and networking powerhouse. As the founder and CEO of Neff Headwear, he also bears the lofty responsibility of serving up trends to the world’s most sort-after audience — the youth market.
The tale of how Neff got to where he is today, at the helm of a multi-million dollar brand selling in 50 countries, is particularly intriguing. It’s one that takes a sharp departure from the usual “worked my way up from the bottom” story. Mostly because Shaun Neff, to this day, is still working his first job.
“It’s crazy but this is the only job I’ve ever had. Since high school I had dreamed of starting a surf, skate, snow-inspired brand that reached out to youth. So when I was up at college in Utah, snowboarding every day, I thought, ‘Alright it’s go time,’ and just went for it.”
‘Yo, wanna rock a t-shirt?’
These are the words that started Neff on his trajectory from t-shirt peddling sophomore to the respected industry leader he is today. Neff had always known that his future would lie within the realm of branding. During high school, he would silently watch and internally critique the mishmash of street brands or statement pieces his classmates wore. But it wasn’t until he had been hustling t-shirts on campus for six months that Neff started to make some serious inroads.
“After selling a few thousand t-shirts the brand started hitting the right kids and influencers, and it got to a point where I had built a cool buzz in this little college town, but wanted to create it on a bigger scale.”
He lived in Utah, home to the biggest group of professional snowboarders in the world. Neff always tried to get them to take one of his t-shirts to wear when filming promos, but they usually already had apparel deals with other brands.
“One night I stayed up reading some of their contracts until the wee hours and the lightning hit — headwear wasn’t written into contracts back then. So I thought, alright, I’m going to get these influencers putting Neff hats on their heads.”
On the eve of a major televised snowboarding event in his college town, Neff, unfazed by his lack of official product, went to a dollar store, purchased a stack of 99 cent headbands and beanies, and wrote his surname on them with a Sharpie. It was a bold move, but one that paid off, big time.
“I showed up and handed out these dollar beanies to the biggest world pros in the world. Later, the guys who won first and third were on NBC wearing beanies with a Neff logo. That was the start of everything,” Neff recalls.
After the televised pro snowboarder coup, Neff rolled up to Milo in Park City (“one of the coolest snowboard shops in the country”), pitched his story and product, and secured Neff Headwear’s first official account, and one it still holds today. Then came the wave that really brought Neff’s brand vision to life.
“We started getting written up in magazines within snowboarding and snowboarding culture. Retailers began reaching out to my cell phone and I was able to handpick certain shops and send them product.
“But it all triggered because the brand was being rocked by literally the top 20 snowboarders in the world, who were doing it for free because I was young, I was their homie and because headgear didn’t conflict with any of their sponsor contracts. If I had had to pay those guys it would have been 2 or 3 million bucks at that time. Reps soon started calling me, like a guy in California who was also a Burton sales rep. He put Neff in all the places that Burton was in, and that’s how we started to really build. It wasn’t online at all, but driven by hype.”
Finding the secret sauce
One of Neff’s most powerful tactics has been the way in which he has embedded his brand into sport and music cultures, seamlessly tying in with key personalities in each market.
In an industry where staying relevant is the difference between success and failure, collaborations with the likes of Snoop Dogg, Wiz Khalifa and DeadMau5 have kept the Neff brand front of mind with their target audience, not to mention the legions of new fans each artist brings. Outside of music, Neff currently has an iconic Disney line in stores, is on the cusp on launching one with The Simpsons, and will soon leap into the underwear market in collaboration with Oklahoma City small forward Kevin Durant.
It sounds great in theory, but how does he pull it off? Networking, being an honest, stand-up guy, and more networking.
“I’m a networking freak. That’s kinda my game plan. But it’s all about being real. A lot of businesses are pitched in a really sales-driven way, or the intent is not delivered as naturally as ‘hey let’s do something rad together and build on it.’ From when I first started convincing pro athletes to wear my dollar headbands I’ve just tried to be real and authentic, and not give the impression that it’s just about using their name on my brand to make money.
“We’ve been blessed to penetrate the youth culture as result, and so we’re in this cool spot where we can kinda alter what kids wear and what they think of fashion. It’s a unique position to be in and I think they key is involving people. One, working with people you admire, and two, saying let’s go out there and create something that doesn’t exist today, merge our fan bases together and stoke people out.”
When it comes to his networking approach, Neff is a firm believer in just getting out there and doing it every day, and learning how to identify those top one, two, or three people in a room you need to connect with. He makes it a priority to spend quality time with the right influencers and always being open to potential opportunities.
“I tend to charter my evenings, my nights, around hunting down the right guys and just vibing out with them on a normal level. I always say if there is synergy, cool, and if not, here’s my info and I’m sure our paths will connect later,” he says.
“Now I am able to turn down opportunities and invites, but for the past 12 years, if there was a party or event that could be good for my brand, I never said no. I wouldn’t be able to sleep at night if I didn’t show up. I think that’s part of my success.”
The non-plan plan
The authentic approach Neff displays in his high-profile relationships also extends to fellow brands and youth culture influencers. Rather than assuming the traditional view that competition is the enemy, Neff seems to embrace his role as contributing to something much bigger than one single brand.
“I just returned from an event in Colorado which brought together the 50 biggest global brands in in youth culture. We were all just sitting at a table and between 50 of us, we’re probably dressing 70 percent of the kids that live. It was an insane opportunity, but we all fit in that one little room. Industries are small,” Neff says.
His seat at this table is pretty remarkable given his entry into business began so fluidly, without any real plans outlined to support or direct growth. This, Neff believes, is one of the reasons the brand grew as organically as it did, because he wasn’t spending energy constantly measuring himself up to an unyielding yardstick.
“I say this a lot to kids I talk to about starting a business: It’s about balance. It obviously depends where you are in your career or what age you are. But, when you’re young that’s the best time to just roll the dice on an idea. Because you are smart enough to see something that could potentially work, but you’re not entrenched business plans and goals. The failures aren’t in your face. I like the idea of believing in a product that is needed in the market and just saying ‘I’m going to create that.’
“Structure is important, but you don’t want to lose that entrepreneurial ‘go’ of just making something happen. Business plans are good if you need investors or you are allocating dollars, but I think you can get too caught up in how the world is going to react to your product based on a piece of paper.”
As many startup CEOs attest, certain growing pains are par for the course when your business expands rapidly. For Neff, growing from a handful of employees to more than 100 employees globally with distributors and sales reps conducting business in 50 countries, there were a few challenges along the way around getting the team working to the same vision and goal. But he doesn’t recall it being so intense that he ever questioned what he was doing.
“I think my advantage was not really having any idea what it was going to take. I was just a young kid with a dream and there wasn’t one person in this world who could have convinced me it wasn’t going to happen,” Neff says.
“The hardest part of growing a brand is putting out something that’s different to what already exists.
Our brand has been out there for over 10 years now and kids know it. So now the challenges come in Neff continuing to be a leader. But I think we’ve done a phenomenal job of staying relevant and ahead of the curve.
“Part of what we do is go out there with things we believe in or think are rad, and try to start these trends. We’re trying to be thumbprint of youth culture, which allows us to test a lot of different artists, genres and collaborations. If you can make the majority of them sticky, you’re good.”
Taking some chips off the table
According to Neff, who sold part of the business to a private equity firm several years ago, timing is everything when it comes to evaluating your business for sale or investment.
“In real estate, it’s location, location, location. With a brand, it’s timing, timing, timing. It’s different for every business, but for me, I’m at the front of a very trend-driven business and culture that changes every day. So making an assessment involved looking at where Neff was at.”
Triggering a sale starts with a company’s profitability and other factors that vary by industry. But it’s also important to be a position to continue growing, Neff says.
“No one wants to invest or buy something that is shrinking or dying. We’re a very healthy, profitable company with a long-term brand, so for a new investor, it was simple in the sense that we had a stable base and they could see where the brand was going to go.”
After coming close to handing off a large chunk of the business to a multi-billion dollar footwear company — a route Neff is glad they didn’t take — a private investor presented Neff with the ultimate win-win scenario. He was able to take a financial reward for a decade’s worth of hard work, but could still enjoy the upside of future growth, without the same level of personal risk. Importantly for Neff, he has retained full creative control and is still steering the ship on a daily basis.
With all of the financial success he’s seen, it all really pays off in the end when Neff sees something he created out on the street. The lost hours of personal time, needing to always be on at any hour of the day or night, and all the blood, sweat and tears are all worth it.
“Every time I hop in the car to drop my kids of at school and see a bunch of kids with Neff backpacks or beanies on, or at night, if I turn on the TV and some artist is wearing product or Richard Sherman is on Sports Center wearing his Neff sunglasses — for me that’s the biggest accomplishment. To see this big idea and passion I had years ago coming true, seeing people rocking it and being influential to youth culture. That’s the raddest thing for me.”
- Work out what you stand for.
- Gauge what they key factor driving your consumer is and then break it down so you can figure out what will drive them to buy your product over someone else’s.
- Work extremely hard to convince them.
- Be different and be relevant. What Neff did 10 years ago is not in the playbook for 2015. Keep it unique.
- Nail these three important attributes on every campaign: a great product, a great marketing story, and a great ambassador.
- Listen to the monkey. If it’s sitting on your shoulder telling you that you have a good idea, you have to roll the dice. Neff would rather fail trying than go to bed at night thinking something amazing could have happened.
- Be smart. Vet your idea to make sure not only you think it’s great, but the closest people around you think so too.
- Don’t be afraid to start with 90% drive, 10% plan. If you believe in yourself and the idea, you can live and operate on that personal drive every day.
- Shoot for the moon. Hopefully you’ll land on Jupiter. Just visualize that you will make it.
- Branding 101 and the 3 simple principles Shaun has used to turn Neff into a 100m+ empire
- How to find the secret sauce to connect with influencers
- The power of authenticity and why it can make or break you in business
- How to know when to “take some of your chips off the table“ and sell some of your company
- Key entrepreneurship lessons for starting out
Full Transcript of Podcast with Shaun Neff
Nathan: Hey, guys, welcome to the “Foundr” podcast. My name is Nathan Chan and I am your host, coming to you live from Melbourne, Australia. Don’t know if my voice sounds a little bit squeaky or a bit nasally. I’ve actually had a really bad cold at the moment. So look, I’m really excited about today’s guest. But before I tell you a little bit about him, I just wanted to take the time to acknowledge a previous guest of our show and front cover feature of Issue 20 of “Foundr Magazine,” Dave Goldberg, who unfortunately passed away about a week ago, which is unexpected and really, really sad.
He was the CEO of SurveyMonkey and I had the pleasure of interviewing him for the magazine for a front cover issue, Issue 20. Also, his interview went live for episode number nine and oh, it’s so sad to hear how he suddenly passed away. And for those of you that are not familiar with Dave’s story, he is the husband to Sheryl Sandberg, who is the COO at Facebook, second in charge. And she wrote this really, really amazing, deep, Facebook post about Dave, just the kind of person he was.
And you know, I only spoke to him for an hour, but the gold that he shared in that interview was just amazing. And he was a really good person, just even speaking to him and just the vibe that I got from him. And it sounds like he was an amazing person, just from all the things that I’ve read about him. So I just wanted to acknowledge that…yeah, unfortunately that he passed away. And I wanted to share with you something that he left with me: a really, really powerful piece of advice that I’ve actually carried with me ever since I spoke to him over nine to ten months ago…well, geez, even longer, close to a year ago.
And that was that there was a lot of assholes out there, so if you’re nice to people, you stand out and you’ll go a long way. And that’s actually something that I’ve found really profound when he told me that and it’s something that I am really, really mindful with every single interaction that I have from anyone. I don’t…I try not to see anybody different to me. There’s no levels, like I’m up here and you’re down there, or you’re up here and I’m down here. I just try to be polite and pleasant and that’s just…naturally, that’s who I am.
But I just wanted to share that with you guys, because I think it’s such a powerful piece of advice and it can go a very, very long way. I talk about marketing a lot and caring. It’s so important to care and it’s one of the best marketing strategies out there. And it’s not even a strategy, but just caring about your customers. People say that and people buy from people they trust. So if you actually give a damn, it’ll make a difference in your business. That’s it from me, guys.
About today’s guest, his name is Shaun Neff and this guy is a super cool dude and I was really, really excited to speak with him. Funnily enough, he connected with us on Instagram. I don’t know how he found us, but at least six months ago, just…not too long after we first started the Instagram account, he reached out to me and said, “Hey, want to interview me for your magazine and podcast?” And he’s like, “Holla back.” And I looked into this dude…this guy and I was just like, “Wow.” He’s a lot going on. He is a proven entrepreneur, really, really interesting guy.
And long story short, 10 years ago, Shaun launched a clothing line and a few years later, Snoop Dogg has endorsed his products and he’s had tons of other celebrities endorse his products. And he’s built a $100-million business out of his clothing label, “Neff.” And amazing story, a lot of gold shared around building connections, branding and Entrepreneurship 101. You name it, there’s a lot of gold here, guys. So that’s it from me, let’s jump into the show. But if you are enjoying these episodes and podcast interviews, please take the time to leave us a review. It helps more than you can imagine and now, let’s jump in.
Nathan: Can you first tell us about how you got your job?
Shaun: Crazy or not, this was actually my first job ever. I was a what, a sophomore…just a sophomore in college and never really had a job. So I always had kind of the dream to start a clothing brand–surf/skate/snow kind of inspired brand–and you know, always had that dream since high school, right? Some kids dream they want to go play on a professional basketball team, I always wanted to have a clothing company that was…reached out to the youth. So basically, when I was up in…went up to school in Utah at BYU. And I grew up in Southern California, so it was the first time I was living in Utah. But I was obviously up…going…near the mountains, so I was snowboarding every day.
So while being up at school, I said, “All right, it’s go time. I had this dream and passion for a while, I’m going for it.” So basically, printed a handful of T-shirts and did that for about six months and ended up selling a couple thousand shirts just out of my backpack, walking around school, picking off kids that I thought looked cool. And I said, “Yo, want to rock a T-shirt? It’s $20,” and literally kind of hustled T-shirts out of my backpack for about six months.
And the brand kind of started hitting all the right kids and getting on kind of the influencers within the town and kind of got to a point where, “Okay, I’d built this cool little buzz in this little college town. And how can I create this on a bigger scale?” So living up in Utah, I was surrounded by the biggest pro snowboarders in the world and hanging out with those guys and snowboarding with them, that I was…I would always try to give them a T-shirt to go snowboard when they go film.
And every time they said, “Hey, I can’t do that. I have a deal with Burton and I have a deal with Quiksilver,” and they had all these apparel deals. So I to home some of the…a couple of the biggest pro snowboarders in the world’s contracts, read them way late in the night. And then, the lightning hit that…back then, 12 years ago…that there was no…headwear was not written in any of their contracts. So I basically said, “All right, I’m going to get these influencers by putting hats on their head with “Neff” on it. I’m not going to be a clothing company, I’m going to be a headwear company.”
And that next day, didn’t know how to make a hat, or never dealt with overseas manufacturing. So I literally just went to a dollar store, bought 99-cent headbands and beanies, wrote my last name on it with a Sharpie and had to get all this product out. I showed up at the event that weekend in Park City that was televised and handed out dollar beanies to the biggest pros in the world. And the guy that went first and third was live on TV–I think on NBC–wearing big, handwritten “Neff” logos. So that’s the start. Sorry, it was long, but that’s the whole story.
Nathan: Yeah, no, this is fascinating. And I’m curious. Back then, 12 years ago, how were you…were you using the Internet to distribute all around the world, or…? How did that work?
Shaun: It initially started with me just walking into a local shop. So obviously, the first time, I was just selling it out of my backpack and people would come to my house and come to my apartment. And I’d lay out a handful of shirts and they’d say, “I like that one, I like that one,” I’d take their cash and give them a shirt and then, we’d go. So that was kind of the initial operation. And then, first of all, I just went to the local snowboard shop…and it’s called Milo, which is still one of the most core snowboard shops in the country.
And I just walked in there and kind of pitched them, “Here’s the story,” and told them I have these big pro athletes that are now starting to wear it. So opened up my first account right there in my college town. And then, from there, we started getting a lot of write-ups and all the biggest pros were starting to wear it, so it was popping up on magazines and all over the culture. So we had a lot of shops now reach out to my cell phone and I would handfully pick some key accounts in certain areas and ship them product.
And then, it was really triggered when the brand was literally being rocked by–I call it–the 20 most influential, biggest snowboarders in the world. And they were all doing it for free, because I was young and I was their homie and snowboarding with them. So we did that grassroots run forever, but we had the biggest athletes in the world. If I had to pay those guys, I’d be…have to be paying them probably $2 million or $3 million to get the team that I had at that time. But they were doing it because it didn’t conflict with any of their other sponsors.
So the brand was getting thrown out there by these pacemakers and leaders within the snowboard industry. And then, reps started calling me and I ended up putting a handful of reps on the brand, like a guy that lived in California and he was also the sales rep for Burton. So he went and literally put Neff in all the stores where Burton was in and that’s how we started to build the business. It wasn’t online, it was all through…you know, the hype drove these sales reps to want to carry the brand and be the rep.
And then, I ended up going to a big tradeshow–the SIA tradeshow–which is the big snow show. And we had a booth there and that’s where we started picking up most of the accounts.
Nathan: And can we fast forward to now, where you guys are at, so the audience can get a little bit of an insight to how far you’ve taken it in the past 12 years?
Shaun: Yeah. So you know, the brand…now, we’re in–geez–over 50 countries. We’re in every youth retailer in America, from the Zumiez, to Tilly’s, to PacSun, to the Macy’s, to the Nordstroms, all the way down to the mom-and-pop surf/skate/snow shops. So the brand’s been on fire and currently, we make a lot of different categories, right? We started in beanies and beanies now are still one of our category leaders. But we’ve started making watches two years ago and we’ve sold about 1 million watches, almost a year and a half into it.
From there, we make outerwear now, snowboard gloves, full apparel. We do a lot of collaborations with a lot of the big artists from Wiz Khalifa to Deadmau5, to Snoop Dogg, to Mac Miller, to collaborations with Disney. We’ve got a big collaboration coming out with “The Simpsons” later this year and also, collaborations with sports guys. We’ve got Richard Sherman, who’s kind of the face of the NFL and then, we’ve got an underwear collection that’s dropping with Kevin Durant for the holidays. So we’re pretty much tied into a lot of the key personalities that the youth are engaged with.
Nathan: Yeah. Look, it’s amazing how far you’ve taken it. There’s a lot I’d like to unpack here, but the first thing that really shouts out to me that I’m sure people are dying to know is, what advice do you give for networking, man? you must have some seriously good people skills to get…even when you first started to get these pro snowboarders to wear your headbands and would have…you had an A-player team that would cost millions of dollars to do these sponsorships: how did you do that?
Shaun: Yeah. I’m a networking freak. That’s kind of my game plan. And I think for me, it’s: one, just being real. I think a lot of people or a lot of businesses, when they’re pitched on you, it comes off just as a sales pitch, or it comes off as…the intent is not delivered as natural and, “Yo, let’s do something rad together and build.” So I think I look at from when I started from convincing the number one, the biggest snowboarders in the world to wear my dollar headbands with my name written on it with a Sharpie, instead of going and getting a big contract with a big ski or snow brand.
I think it was…it’s just the delivery of just being real and authentic and saying, “Hey, let’s build stuff together.” It’s not about, “Hey, ride for my brand,” or, “Hey, Wiz Khalifa, let’s just not make something with your name on it for my brand and make money,” it’s, “Let’s do something rad together.” And we’ve been blessed to kind of penetrate the youth culture, so now, we’re in a very unique spot that we can alter what kids wear and what they think of fashion.
And it’s a unique position to be in. And I think the key is involving people and working, one, with people that I admire and that I want to work with. But two, sharing that vision of, “Hey, let’s go out and create something that doesn’t exist today, that we can merge our fan bases together and stoke people out.” And networking’s kind of one of those where I think you either…you have it or you don’t. I don’t think you can really learn it.
You’re either born with that ability to cruise around, identify, “There’s 100 people in this room. Who are the top one, two and three influential guys that I should be talking to, to potentially learn from or create something with?” And that’s kind of how I charter my evenings and nights and hunt down the right guys and be real with them and vibe out with them on a normal level, then tell them what you do and see if there’s synergy. And if there’s not, “Here’s my info. And we both are doing amazing things, I’m sure our paths will connect later.” That’s kind of my vibe.
Nathan: And I’m curious. How often are you meeting new people?
Shaun: A lot. Yeah. Daily, I would say. We’re so entrenched with musicians and artists and athletes and managers and production houses and record labels and…that I’ve been in this now for a lot of years, worked with a lot of people. And you know, industries are small. It’s like, I just got back from an event in Colorado, where there was 50 of the biggest brands in the world all together in youth culture. And we’re all sitting at a table and literally, between the 50 of us, there’s…we’re dressing 70% of the kids that live, you know? So it was an insane opportunity, but we all fit in that one little room.
So I’d kind of penetrated that sports scene, the entertainment scene, the action sports scene and the apparel scene, so it’s…they’re small little groups of…once you can get in the party and have some credibility and I think, treat people right. That’s my game of, always say what you’re going to do, never go behind someone’s back, never do a deal that’s shady, never…anyone comes at you with a proposal and you say…that’s the key, is saying…doing what you say you’re going to do, because I think a lot of people in this realm, it…there’s a lot of shady business out there. And that’s just kind of how I roll.
And I get invited to a lot of different things and it’s the first time in my life that I’m turning down opportunities. I’ve been at…no matter what party, event, if I sense there was any opportunity that would help my brand, for the last 12 years, I’ve never missed that party or that get-together or that event for that dinner. I was just psycho on that, making sure that I never left an opportunity that potentially could have been. And I think that’s part of my success: is, I just have that extreme drive to, hey, if this potentially can do something that benefits the brand or future opportunity, I wouldn’t be able to sleep at night if I didn’t show up.
Nathan: I’m curious. When you first started or during this whole 12-year period, can you tell us about the tough times, the struggles? Was it always just uphill, or…?
Shaun: Yeah, it’s unique, because when…I think that’s…the key to my success in the beginning was…never really having a job and not really knowing what it takes to run a business, I think was my biggest advantage, just being so naïve on what it’s going to take for this thing to actually work. I was just a young kid that had a dream. And there wasn’t one person in this world that could have convinced me 12 years ago–or 11 or 10 years ago–that this thing wasn’t going to happen.
And it wasn’t based on, I thought I was the greatest thing in the world and…or any…there was not thing leading towards success, right, no…it was just a very young kid with a dream that…and it was a…more than a dream, because I believed it, right? And I’m just…it wasn’t like, “Oh, I hope the brand blows up.” It was like, “You know, we’re going to blow up and next year, we’re going to do this. And I’m going to do these five things to make sure we get there.”
So it was just kind of like I envisioned the brand in a sense of where it is today and really not knowing how hard it is and how lucky I had to be. And everything had to be right a million times. I think that was my biggest factor of having success. And then, the trials…it’s interesting, right? It’s like, the first…the hard part is growing that brand, putting out a product that someone needs that’s different that already exists in the market. And that’s the hard part.
And for me, that’s when being so naïve, it was just a great time to face those challenges, because I didn’t really think about them as building…as hurdles or, “Oh, man, this is tough. I’ve got to figure it out.” I just went and was solution-oriented every five seconds, right? I probably got–who knows–20 things that would happen a week, that maybe a handful of those things, someone would have been like, “I’m out,” or, “I can’t do this business anymore,” or, “This is ridiculous. It’s never going to happen.”
But I never thought like that once. I just created an answer to this problem instantly and just went with a belief that it’s going to happen. And I would say struggles now–just based on size of the company, a lot more employees, changing environments–our brand has already been out there, kids all over the world know it, we’ve been cool for a lot of years. So some of the challenges, come now, are just maintaining relevance and continuing to be a leader once you’ve led for so many years, just because the nature of a kid is, “It’s cool, I’m on it and then, I’m going to do something else,” right?
It’s like music and there’s so much turnover in the youth, but we’ve done a phenomenal job of staying relevant within youth culture and staying ahead of the curve. So those are the biggest challenges: is just, when you put your last name on a shirt and there’s a thousand other brands putting their name on a shirt and their brand, how do you convince that kid to buy yours and not the others? And that’s the continuous challenge and growing pains. I mean, going from a handful of employees to a lot more employees, to doing business in 10 countries to now 50 countries and just the logistics side and management of a larger group brings challenges to make sure that everyone’s staying on the same page, the same vision and has that same goal.
Nathan: Yeah, I’m really curious, how do you guys stay ahead of the curve? How do you always know what school and what kids want to wear?
Shaun: You know, you’ve just got to be in that scene. And you know, I’m 35 now, so I’m at least young enough where I can still hang out in the right spots where the influential kids that are and kind of be entrenched in the industry. And so, keeping my finger on the pulse is something that’s very important with traveling and being at certain events. And we’ve got a very young marketing team, a very young design team. So relying upon their thoughts, their ideas, how they live their lives and really, just gauging kind of what kids are into.
I mean, social media’s such a great tool to monitor and see what these kids are listening to, what they’re wearing. And us working with some of these big artists and musicians which are the trendsetters, part of our goal is, we go out and try to create those trends, right? We take an artist that has 10 million fans through their social media and we dictate something that we both believe in and think that’s rad and we go out and try to start that trend. So it’s a never-ending battle. It’s very, very quick. What’s hot today will…is going to be lame tomorrow.
Nathan: So you’re always testing, right?
Shaun: Yeah, testing. You can’t be unique. I mean, our brand is wider than most, in that we’re all about having forever fun and we’re not pigeon-holed to just a skate brand or just a snow brand and just not a streetwear brand. I mean, we’re trying to be the thumbprint of youth culture, which allows us to steer the ship in a lot of different directions and pick up as many kids as we can. So with that being said, it allows us to–yeah–test a lot of different artists and genres and musics and collaborations, which if you can get majority of those sticking, you’re good.
Nathan: I read somewhere that you launched without a business plan or marketing strategy. Well, what advice do you give to aspiring and novice entrepreneurs? Do they need to plan that heavily?
Shaun: Yeah. You know, I think for me…and I say that a lot. I think the more kids that I talk to about starting a business, it’s a balance, right? I think it depends on where you are in your career and what age you are, right, because in my opinion, when you’re young–graduating from college, in college, a couple years out of college–in my opinion, that’s the best time to just roll the dice on an idea, because you’re smart enough to say, “Could this potentially work?” But you’re not entrenched in the overall planning and goals and business plan and the failures aren’t in your face, in seeing all that can take you down.
So for me, I like the idea of believing in an idea or believing in a product that’s needed in the market. And believing in that sole purpose that it’s a need and you’re going to create it, I think it’s the most important thing. And then, from there–depending on kind of where you are in your life–the structure is important. But I’m not…I think the more people spend time on business plans and mapping out their one, three, five, seven-year plans and allocating budgets and targets, I think that you start losing that entrepreneurial goal of, “Let’s make this happen.”
Or you’re trying to make decisions based on a budget, or make decisions based on a plan that you set seven years ago where there were no changes. And you know what? Your plan might change a little bit. And I think the idea of a business plan and structuring, it is good for if you have an investment or you’re allocating certain dollars. And it’s smart, you should plan out where you’re going to spend them, who can you afford to hire, what are your needs. That type of stuff is important, but I think too many people get caught up in mapping out how the world’s going to react to their product, based on a piece of paper which, to me, I don’t agree with.
Nathan: I’m curious. You’re a privately-owned company. Did you ever consider taking on investors, or you never needed that?
Shaun: No, yeah, it would have probably helped, but we actually sold a bunch of the business to a private equity firm a couple years ago. So I…yeah, I went and spoke at this NASDAQ conference at the NASDAQ building in New York a couple years ago. And I was not that familiar with private equity and it was kind of a huge conference where all the big firms went and I spoke at it. And little did I know, the next day, I’d have about 50 offers for my company, right? So I was like, “Oh, wow.”
And so, that kind of got me triggered on, “Geez, I’ve been grinding this thing for 10 years. That’s amazing, I can have an opportunity to make that amount of cash and keep doing this.” So that kind of intrigued me. But then, I kind of went out a little bit and researched and got a firm and we talked about some potential opportunities to kind of take the business to the next level. And I went down on the route with a large footwear company–multibillion-dollar footwear company–that had interest in buying the whole thing and I ended up not…then ended up not going down.
And I was glad, because they were buying a huge piece of the company and I would potentially lose some control and protection of my people. So we ended up doing a deal with a private equity firm, which allows me to run creative final say, be kind of the CEO of the brand. And I can continue driving the ship and was able to take some chips off the table and get some funding behind it to get to the next level.
Nathan: And how do you know? If you do get an offer for your business, like you did, how do you know whether to sell or not? What sort of thought process did you go through, out of curiosity? Because I’ve been in that position, too, where someone’s actually…I’ve had multiple offers to buy out the magazine in our brand and I’ve turned away from that. But it’s a very tough decision to make.
Shaun: Yes. And I think it’s different for every business, right? When…I mean, if you can all of a sudden create the world’s best new water company–and you know, water doesn’t go out of style and we’re all going to need it–then, I think you can hold onto that thing for a long time. Whereas I’m in a business of very trend-driven, youth culture-driven business that changes every day. So for me, the assessment was in looking at where your business is at, right?
I mean, everyone knows that you’re going to trigger a sale of an EBITDA number. And you have to be very profitable and there’s multiples per your industry on what values your company. So you’ve got to be smart about setting up and driving and managing your business to drive that multiple, so you can get a good value out of the brand and what you’re selling. But more importantly, it’s got to be positioned where there’s still a lot of upside, right, because no one wants to invest or buy something that is shrinking or dying.
So I think for me, I think it was the perfect time. I’d done it for 10 years. We’d been in the game, so we’ve proven we’re a long-term, stable brand, so that hurdle was jumped. And we at a great side, a very healthy, profitable company. We were content with where we are, from an EBITDA standpoint. And still, we were controlling our distribution in the sense that we were in all the right stores and we still had all the majors in some of these bigger accounts that we had sold too.
So for that new investor, it was a very simple investment in the sense where, “Hey, you’ve got this sturdy base and we see where the upside’s going to be, of where the brand could go.” So I think it’s…if you’re an…owning your company, I think one: it’s, what do you want, right? And for me, I felt like I got the best of both worlds, because I was able to be compensated for the last 10 years of my life, just blood, sweat and tears, working on something. So it’s great to be rewarded on that level.
But then, the route I went is, I still want to own a chunk of this business. And that’s why I chose to go the private equity route, where I can still have upside–you know, a lot of upside–in the future growth of the business, but able to take some chips off the table to diminish that risk of being a lot of people who built something special and turned down a lot of offers and three years later, their brand’s not worth anything. So I had plenty of conversations with people that have missed…turned down a $100-million deal opportunity and they end up selling their company and…for a dollar and the new guy’s assuming the debt, right? So that happens.
I think timing’s everything, right? Timing’s everything. Whether you’re selling a business, starting a business, doing a deal, timing’s everything. So real estate’s “location, location, location,” a brand is “timing, timing, timing.”
Nathan: Your timing’s always been spot on, or very spot on. And…
Shaun: Yeah, most of it has. Most of it has. I mean, there’s definitely things that you wish you can change or do better. But overall, I think the last 12, 13 years, I can sit in this chair and say, “You know what, I’ve hustled as hard as I can, I’ve given it my all. And a lot of stars have aligned and I’m very grateful and no regrets.” I think that’s the big word for me.
Nathan: I’m curious, let’s talk about branding. What advice…? Do you have some…just some really gold advice for our audience around branding, what it takes to build really strong brand, a brand of longevity?
Shaun: Yeah, I think it’s…initially, it’s kind of, what do you stand for? And branding’s unique, because it can live…branding transitions with several different products and categories, right, whether… If you’re a bank, it’s…Your branding’s more about building trust, or…whereas a brand like mine, you’re trying to brand that you’re cool. So I think you have to: one, gauge whatever industry your product sits in, what’s the key factor that drives that consumer.
If you’re a clothing company, it’s got to be cool, it’s got to look cool, it’s got to promote cool. It’s got to be something enticing that someone wants to wear. If it’s a restaurant, you’ve got to have freaking good food. So it’s about good food, it’s about the experience. So if you just break it down, I think it’s–whatever your product is and the category you’re in–what drives that consumer. And if you can figure out what drives that consumer to buy your product over someone else, you’ve got to own that. And you’ve got to work extremely hard to convince the consumer that, “Hey, this is what we do, this is why we’re good at it and this is why you should buy our product.”
And when I look at branding in our space, it’s being unique, it’s being different, it’s being trendsetting. It’s what we did 10 years ago, it was not our playbook for next year. And so, branding’s unique, because to be successful, I feel it’s per industry and being different. But in the end, you have to have great product. There’s kind of…the three things that I live by are: if you can have great product, you have great marketing story and then, if you could have a great ambassador, someone that is promoting your product.
Those, for me, when those three align–having a great product, a great story…marketing story…and then a great person promoting it–it almost never fails.
Nathan: I’m curious. When you talk about “story,” what is the Neff story?
Shaun: For 2015?
Shaun: Yeah, so our overarching story is “forever fun.” I mean, that’s the biggest story we try to tell. And in our business, we tell stories that are more from a design and storytelling perspective. Like, coming into this next back-to-school collection, we have a story that’s all about hunting and fishing and outdoors. So there’s a big trend of the outdoor lifestyle and making that hip, right? So we’ll be telling that story from a product side.
We’re going to be telling a big story with Kevin Durant this year about one of the best athletes in the world and we’re going to have functional, active lifestyle underwear that we feel is a gap in the market. There’s…no one owns the teenage underwear market, unless it’s a three-pack at Target. So we want to be that branded underwear where people think, “That’s a cool underwear brand. And it functions and it performs.” So back to the great product, right: making great functional underwear. Great ambassador, Kevin Durant. And we’re now creating a great marketing story on how to launch it. So…
And at Neff, we tell a lot of stories. I mean, we’re in hip-hop, we’re in… I was just with Juicy J last night and I flew out…I mean, we flew him out to a big event with one of our retailers and he performed. And then, I also brought King Bach, who has 10 million people on Vine and he’s one of the biggest social personalities in the world. So kids nowadays, you can’t…the overarching story is “forever fun,” but just like that kid on that phone, he’s looking for five or six new things every time he gets on there, to keep him entertained. So we always have to be shooting a lot of messages to resonate with the kids.
Nathan: All right, look, we have to work towards wrapping up. I’m loving this conversation. I could speak to you all day, man. I was going to say, what has been your biggest sacrifices that you’ve had to make to get where you are today?
Shaun: Yeah, I think it’s…and the biggest sacrifices are probably time. You know, I’m married, have two kids and that’s always the balance. And you know, what’s made me successful is just, never turn the lights off, right, and always going. Whether laying in bed and it’s midnight and I’m firing off emails and triggering new ideas and concepts and talking with this artist that just texted me at 1:00 a.m. and wants an answer on something, I’m always going.
So I think that’s been my biggest sacrifice, would be my personal time, because when you have a job…and I know it as an employer: is, it’s a job. You get there at a certain time and you can leave at a certain time. When you own your own company, work hours don’t exist. You’re just…you’re always on. And so, I think that’s a big sacrifice that I’ve laid out to build what I have, is just always going and never stopping. So that’s probably one of the biggest sacrifices, in my opinion, for me.
Nathan: And how often do you work? People might find this interesting.
Shaun: Yeah, it’s interesting. I mean, I’m in the office probably 70%…70%, 75% of the time, I’m in the office. And that other 30%, 25%–call it–rest of the time, I’m just out working, but networking, right: going to events, meeting with artists, going to parties and meeting with retailers and driving the business. So I’m pretty much…I mean, on Monday through Friday, it’s go time. And a lot of weekends…it’s getting less and less on the weekends nowadays, but there’s always…our brand is how big it is. And where we’re at, there’s always something going on every day in a certain area, so it’s just prioritizing and picking off what I can chew. But yeah, the hours are pretty much nonstop, man.
Nathan: Okay, last question. Out of all your success, what do you value the most?
Shaun: Yeah. For me, it’s just the enjoyment of seeing what I’ve created, just in the world and out in the market. I mean, still, every time I’m hopping in my car, dropping my kids off at school and there’s a bunch of kids that have Neff backpacks or beanies on. And then, at night when I’m turning on the TV and some artist is wearing some Neff product, or Richard Sherman’s doing this big thing on SportsCenter, wearing his Neff sunglasses.
And for me, that’s the biggest accomplishment, is just to see this dream, impassioned idea that I had several years ago, to kind of come true and just see people rocking it and wearing it and being influential to youth culture. I think that’s the raddest thing for me, is just being able to penetrate the youth culture and be a part of that.
Nathan: Yeah, no, that must be a great feeling. Also, do you have any advice for aspiring novice entrepreneurs, our audience? What are some good pieces of advice, best pieces of advice you would give?
Shaun: In the apparel industry, or…?
Nathan: No, just entrepreneurs just trying…our audience trying to build a successful business.
Shaun: You know, be smart about it. Make sure that it’s an idea that not only you think’s great, but a handful of your closest people around you think’s great. Because a lot of times, people can get so caught up in their own idea that they block out normality or they block out reality, that they’re just chasing a pipe dream that never can really come through. So I think the initial step is just gauging that idea and believing in it, but making sure that you’ve talked to your trusted people–your family or your friends or your other successful people you know–and vet out that idea and make sure people don’t look at you and think you’re crazy.
And still, if they do look at you and think you’re crazy, I’m still a fan of driving that passion and building something. But you come across a lot of people that are stuck on the same dream and it’s 10 years into it and they don’t know when to give up. So that’s kind of the sad advice I guess I would have about that. But I think the positive…because the drill, you talk to a lot of people that are just and you’re like, “Yo, dude, no one’s buying these VCR and freaking tape thing, or…to watch movies, so stop thinking about it.”
But I think that the best advice is, shoot for the moon and hopefully, you land on Jupiter. It’s just kind of…for me, when I just started this thing, it was just…you just…and visualize and picture that you’re going to make it, you’re going to do it. And you literally live, operate and personal drive every day that it’s going to happen. So I think to believe in yourself and believe in the idea is probably some of the best advice, because that pure intuition of, “You know what? I believe in this and I’m going to make it happen,” I think that’s 90% of the drive. And the other 10% is your business plan and this and that.
But those pure ideas, if you believe it and it’s…there’s something in the back of your mind that tells you to do it, or that monkey sitting on your shoulder, saying, “Hey, maybe you should leave that job, because you’ve been thinking about it for a year or two,” and there’s still that monkey on your shoulder that saying, “Man, that’s a good idea you have,” at least…you’ve got to roll the dice. And that’s how I roll. I’d rather fail trying then go to bed at night thinking that something amazing could have happened. There’s something you know that that you can put together.
Nathan: Awesome. Well, look, thank you so much for your time. I really enjoyed speaking with you, Sean.