Nothing astounds me more than finding a skateboard article on the front page of the New York Times. When non-sk8 media outlets begin running stories on skateboarding, it must be blowing up. Jamie Thomas has long been respected for staying true to skating and managing his companies accordingly. Did you know he was named Ernst & Young's entrepreneur of the year award for San Diego in its consumer and business products and services category?
Nothing astounds me more than finding a skateboard article on the front page of the New York Times. When non-sk8 media outlets begin running stories on skateboarding, it must be blowing up. Jamie Thomas has long been respected for staying true to skating and managing his companies accordingly. Did you know he was named Ernst & Young's entrepreneur of the fucking year for San Diego in its consumer and business products and services category?
Article from:
The New York Times | November 24, 2006
In Board Sports, Insider Status Makes Gear Sell - By Matt Higgins
Jamie Thomas has built a thriving business in the more than $11 billion board-sports industry by following principles he knows in his bones, the very bones that Thomas, a professional skateboarder, has broken over the years.
Jamie Thomas has turned down offers to buy his company, Black Box, which manufactures and distributes footwear and skateboards.
Jamie Thomas has created three brands, including Mystery skateboards and Fallen footwear, all under the banner of Black Box, Inc., a distributing company he owns.
He is attentive to the bottom line, but mindful of another line separating hard-core - or core - skateboarders from everybody else. He sells vast numbers of skateboards, sneakers and T-shirts, but he refuses to sell out.
If it seems confusing, that is sort of the point. An insider's understanding has kept the lucrative board-sports industrial complex - skateboarding, snowboarding and surfing - mostly in the hands of hard-core practitioners, even as these sports have grown more popular. Mainstream companies like Nike that have easily penetrated other sports often find themselves on the outside looking in, struggling to gain traction with action-sports athletes and fans who define their world by its antiestablishment bent.
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Mr. Thomas created his first company in 1996. He called it Zero, because skateboarders were deemed zeros - losers. But in the past 10 years, skateboarding's popularity has soared, with more than 11 million participants. These days, the only zeros in skateboarding are organized in groups of three, to the right of dollar signs, and separated by commas.
Mr. Thomas, 32, has parlayed Zero into three brands, including Mystery skateboards and Fallen footwear, all under the banner of Black Box Distribution, another company he owns.
Mr. Thomas has turned down several offers to buy his company for the same reason he will not allow his products to be sold anywhere but skateboard shops.
"The thing that makes skateboarding unique is that it's a subculture," Mr. Thomas said. "You're inside the group. Until you cross the line, you'll stay inside the group. Crossing the line is selling, and you'll go down on the brand-credibility barometer."
In other words, selling a stake in your business, selling to the wrong stores, selling bad product or selling too much product - it is all tantamount to selling out.
"Selling out is not about profits," said Lora Bodmer, a spokeswoman for Action Sports Retailer, the leading board-sports industry trade show. "It's about distribution. That's a big deal in our industry - exclusivity."
The board-sports business, which began with surfing, has always been run by practitioners. The surfer Dale Velzy opened the first surf shop, in Manhattan Beach, Calif., in 1949.
Mr. Velzy took a cottage industry - surfboard shaping - and made it commercial. He was the first to place his brand on T-shirts and under the glass on boards. And he created a surf team with some of the world's best riders. These innovations laid the foundation for the board-sports industry today.
In snowboarding, the industry leader, Burton, is owned by Jake Burton Carpenter, who helped conceive the sport during the 1970s as a rider and businessman. And Phil McKnight, the chief executive of Quiksilver, the largest board-sports brand, was a surfer who helped build the label in the 1970s by selling the company's shorts to surfers from the back of a truck.
Several board-sports entrepreneurs are professional athletes, and they have an automatic appeal for consumers and merchants.
"A lot of hero worship in action sports is based on a particular pro's fashion sense," said Kevin Imamura, the communications manager for Nike SB, the sneaker giant's skateboard line. "Jamie Thomas - people want to dress like him. He's setting trends, just like he did pushing the progression on a skateboard."
Mr. Thomas's Black Box company has 160 employees and a 120,000-square-foot warehouse in Carlsbad, Calif. The company has grown 200 percent during the past seven years. Mr. Thomas was named Ernst & Young's entrepreneur of the year award for San Diego in its consumer and business products and services category. With shoulder-length hair and mutton-chop sideburns, he was the only entrepreneur in Ernst & Young's promotional photos not wearing a sport coat.
Few in board sports have any formal business training. Some have never been to college. Mr. Thomas dropped out of high school in Alabama at 17 and moved to San Francisco, where he lived on the streets before becoming a professional street skater.
"Skateboarding and my pro career were like boot camp for business," he said. "Trying tricks, envisioning outcomes, persevering - that's exactly like business."
All successful board-sports entrepreneurs have an insider's knowledge of industry orthodoxy, too, said Bob Klein, a professional snowboarder turned agent.
"Board sports have always been an exclusive culture," Mr. Klein said. " ‘We know and you don't, and you guys are clueless.' "
Only a few corporate giants have cracked the closed ranks, and they have been regarded with wariness.
Pacific Sunwear, or PacSun, sells board-sports apparel in its more than 850 locations in shopping malls throughout the United States. Some of its top brands include industry heavyweights like Billabong, Quiksilver, Roxy and Volcom.
Yet one of PacSun's recent advertisements in skateboard magazines featured a skateboard with the trucks - axles - on backward, the kind of goof that would never happen with a core merchant.
Nike has targeted the core with a line of skateboarding sneakers.
"It hasn't been an easy road," Mr. Imamura said.
Before releasing its SB line in 2001, Nike had tried to market skateboarding sneakers twice and failed. The difference now is that Nike SB has a limited distribution to skate shops, Nike has sponsored grass-roots skateboarding contests and several on Nike SB's staff arrived from the board-sports industry, including Mr. Imamura, who was editor of an action sports lifestyle magazine.
"I think they're always going to walk that line," said Tony Hawk, a skateboarding champion and successful businessman who owns Birdhouse Skateboards and sold his Hawk Clothing brand to Quiksilver in 2000. "Nike, because of Air Jordan, they were the purveyors of cool. There are hard-core people who say, ‘Get out! You don't deserve to capitalize on skating.' "
But with a potentially enormous payoff, more mainstream brands will try to penetrate the board-sports market. Last year, Reebok put out a line of skateboarding sneakers in a licensing agreement with DGK (Dirty Ghetto Kids), a brand owned by the core street skater Stevie Williams.
And through outlets like PacSun, brands can sell to not only the 23 million core surfers, skateboarders and snowboarders in the United States, but also to a larger demographic of consumers craving board-sports labels.
Footwear and T-shirts account for $5 billion in annual sales, according to Marie Case, the managing director of Board-Trac, an industry marketing and research firm. Broken down by sport, she said, the industry consists of $5.5 billion for skateboarding goods, $3 billion for snowboarding and $3 billion for surfing.
The professional snowboarder Danny Kass has seen firsthand the rising interest in core brands like Grenade, a glove and outerwear company he founded with his brother Matt in 2000.
Mr. Kass, 24, a two-time Olympic silver medal winner in the halfpipe competition, said sales had doubled each year of operation, with figures for 2006 expected to be $6.2 million.
"We really cannot put our logo on enough things," he said. "There's definitely a demand."
Yet Grenade has maintained an image as the epitome of a core brand: rider-owned, exclusive, with an iconoclast's bent.
"We were all in our early 20s and teens when we started," Mr. Kass said. "It was something that made us stand apart. We didn't want to do what other companies were doing.
"A lot of companies can't figure out the formula for our success. What we have is organic."
As a top athlete, Mr. Kass also has a platform to promote his products. "He's such an icon," Mr. Klein said. "When he wears the newest product, it becomes popular instantly. It's hard to top that marketing."
Mr. Kass acknowledged that in the coming years it could be difficult to manage Grenade's growth and retain control of the company.
"It's harder every year for banks to loan 24-year-old kids millions of dollars," he said.
But the Kass brothers have resisted any temptation to sell, even turning down an offer from Quiksilver to buy their company in 2005.
Mr. Thomas could relate to their decision.
"It's hard to get it," he said about core credibility. "When you lose it, you can't get it back."
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Don't stop at the day's comics... newspapers can occasionally have skate-worthy coverage.
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