Since Title III of the Jobs Act just recently went into effect we decide to get a closer look at how CEOs actually view the new legislation in respect to their future financing needs. We had an opportunity for a Q&A with Terry White the Founder/CEO of athletic apparel companyWOLACO. He was able to share with us the company’s history as well as their first crowdfunding experience with Kickstarter and his perspective on Title III.
CT: What does WOLACO mean?
TW: WOLACO is an acronym for Way of Life Athletic Co. I thought about the company name long and hard, I asked close friends for input, and conducted lots of surveys. However, it was during a commute home from my day job at the time that WOLACO popped into my head. I asked myself what I really wanted this company to stand for, and concluded that at the core, it was about an athletic and deliberate Way of Life.
Since the start, we’ve been uniquely focused on meeting the lifestyle needs of the modern male athlete—guys who need active apparel that’s bold, functional, comfortable, and built to last…not for brunch. Gear for guys who live life with deliberation, passion and daring.
CT: When and where did the idea come from?
TW: There are two pieces of the puzzle that came together soon after my college graduation. I was a collegiate athlete and despite much forewarning, I was caught off guard by the abrupt transition from that hyper-athletic lifestyle to a largely sedentary professional routine. As a young professional, I was spending 80 percent of my waking hours either sitting at a desk or commuting to-and-from work. When I wasn’t working or commuting, there were other hindrances that prevented me from living an active, healthy life. Living in New York City, you have the challenges of time, money and an outdated corporate culture that revolves around happy hours and client entertainment—indulgences. This challenging transition really moved me to want to find the right work-life balance.
Then, I had an idea for a product. At the end of 2013, I left my NYC apartment to go for a run. With my phone in my hand and my key tucked into my sock, I thought to myself, there must be a better way. So, I came up with the North Moore Short—a men’s athletic compression short with two sweat-proof pockets, one pocket for your phone or music device and the other for your keys, cash, credit cards, or any other valuables. This was the catalyst for WOLACO. The foundation of the brand was already being built, but it was this game-changing product that afforded me the window to enter the market.
CT: How is your compression gear different from others?
TW: We’re the first company to introduce sweat-proof compressive pockets to compression gear—and we’re the best at it. What makes us different is that we’re the only apparel company that’s uniquely focused on the needs of the modern male athlete.
- To ensure built-to-last durability that can withstand our customer’s lifecycle (multiple washes, high intensity workouts) we use a heavier, performance-based compression fabric, held together by a flatlock construction with reinforced stress points. It’s intended to be Worn Hard, Washed Gently, as our care and content label advises.
- To enhance and streamline your workout, our compression gear features two compressive, sweat-proof pockets, reminding you that sweating while working out isn’t just okay, it’s encouraged. The placement of these pockets is also strategic, making access to your valuables while working out seamless.
CT: Tell us how WOLACO got off the ground?
TW: It’s been a very organic process and largely grassroots the whole way through. It started with a small family loan that funded our initial product development. My brother Alex and I then liquidated a small investment fund to build our website. From there, we launched a series of pre-sales, selling 500 units of our North Moore 1.0 and then we graduated to Kickstarter to reach a more diverse customer base very quickly.
CT: What made you choose to fund via alternative investment options?
TW: It was a decision that I made early on. I had a concrete vision for WOLACO and I didn’t want to sacrifice that vision for large investments, especially during the foundational stages. Kickstarter, in particular, allowed me to remain vision-focused, while also engaging the community in a meaningful way, selling product to athletes around the world, and getting a lot of tremendous feedback and direction from our customers.
CT: Kickstarter is both a costly and time-consuming venture, what assured you of a lower risk to reward ratio? And what attributed to the success of your campaign, which exceeded goals by 400%.
TW: During campaign preparation, a mentor of mine, who had previously run a successful Kickstarter himself, told me that it was just like a game of dominoes. If you could line up all the pieces beforehand, once your campaign launches, all you’d need to do is nudge the first one and the rest falls into place. I took the concept to heart, and in many ways, his philosophy proved true. Preparation is everything; you cannot rely solely on organic traffic on the platform to fund the whole campaign. It requires a “kitchen sink” networking approach, which means exhausting every networking angle you can imagine, and preparing them for what is to come.
That said, in any business, the quality of the product is of pivotal importance. It’s also important to keep in mind that crowdfunding campaigns are unique in that the consumer takes an unusually large risk with you. Even if a campaign is well-funded, there are an incredible number of things that can still go wrong, whether that means a delayed delivery, or, worse case scenario, a complete failure of delivery altogether.
Lastly, creativity—the product or concept needs to turn heads and have a strong, consistent message. If you’re not doing something different, improving upon something or challenging norms, then you should think twice before launching a crowdfunding campaign. Some companies are well-suited for this type of funding method, but others, not so much. WOLACOwas addressing popular demand for a product that met people’s needs. We had an overwhelming amount of organic support for this simple, well-engineered, yet unprecedented product.
CT: Tell us about the brand’s growth since its inception.
TW: We’ve grown from a community of 350 customers throughout the Northeast to over 6,500 customers from 50 countries around the world.
CT: How do you currently market your product line, and where are the products available?
TW: WOLACO’s gear is primarily available through our online e-commerce store, wola-co.com. We’re engaging in a number of additional means of distribution, though, including local retailers, on- and offline affiliates, and through a network of brand ambassadors.
To this point, the majority of our marketing to this point has been done through organic efforts, including social media and email marketing. We’ve leveraged influencers to raise awareness and gain exposure. And we’re looking to establish partnerships with those brands that align with our mission.
CT: What plans do you have for the future?
TW: Functional compression is how we started and will always be rooted in who we are. Over the next year, we’ll continue to listen to what our customers are saying. We’ll continue to elevate our compression offering, while strategically expanding our brand and thoughtfully introducing new products that fit the needs of our customer.
Our greater brand mission is to inspire an epic life through active living. As we look ahead, our ultimate goal is becoming the lifestyle brand for the modern athlete.
CT: The SEC’s JOBS Act, Title III went into effect on May 16th. Can you explain what that is, and how it’ll impact businesses looking to raise early capital?
The amendment to Title III of the Jobs Act is an easing of regulation. Which allows non-accredited investors to invest in companies raising raise less than $1mm on an annual basis.
Generally, the crowdfunding aspect of Title III of the JOBS Act makes capital potentially more accessible for young startups. It reduces invest risk by allowing for investors with less experience to invest less substantial dollar amounts in to early stage companies. For early-stage companies with a great story, vision and team, but limited traction and proof of concept in the market, Title III will help to raise capital in lieu of a lack of time in the marketplace. In turn, expediting investment and allowing them to focus on building their business.
Additionally, companies built around a community will benefit even further from Title III, as it is an opportunity to disperse ownership to some of the company’s most loyal customers. For early-stage companies, this community empowerment could be exactly what is needed to build much needed momentum.
Terry thanks for your time and we will keep our eye out for WOLACO and any new developments from your team.