Have You Heard About Hand-Me-Ups?

We have all heard of hand-me-downs… Don’t you remember when you finally got the chance to nab your big brother’s awesome leather jacket or that dreaded moment when mom approached you with your older sister’s totally-not-cool polka-dotted sweater?

But have you heard about the hand-me-ups?

In today’s tech-driven world, it is no surprise that our tech-driven Millennials are intent on getting their hands on the most up-to-date pieces of technology — whether it be one of the new Ultrabooks like Dell’s XPS 13, new Skull Candy headphones or the latest Nook.

But then you might wonder what happens to the other pair of headphones and the other laptop.

Read more.

5 Minutes With…Sarah Prevette, Founder of Sprouter.com

This week we catch up with Sarah Prevette, Founder of Sprouter.com. Sarah’s an inspiration to entrepreneurs who have been at the brink of failure but pushed through to success. Sarah spends her days telling the world about other successful entrepreneurs, but hers is the story you really want to hear. 

1. Sprouter.com was scheduled to shut down last summer but, as we know, remained in operation after it was acquired by Postmedia Network Inc. Can you shed some light on what must have been a very difficult time for you professionally and personally? 

It was one hell of a summer. There’s enough back-story to fill a book, but suffice to say, we were facing a multitude of challenges and just couldn’t seem to find a way around them fast enough. We had limited resources, limited capital, limited time… when it all piles it up, it’s overwhelming. I’ll admit it; I gave up. I just couldn’t do it anymore. Let’s call it “battle fatigue”… there’s a point, after you’ve been battling for survival for so long, that you just finally say “enough”. You’re exhausted, frustrated and just want it to stop. You admit defeat just to save your own sanity. Besides, as has been said a million times before by hundreds upon hundreds of pundits: if it’s not working - maybe it doesn’t deserve to live.

Making the decision to shut down and walk away was by the far the most excruciating moment in my life. Sprouter was my life… it consumed every waking moment - and most sleeping ones. I was in love with the mission and still had many things I wanted to do. The toughest part was mentally rectifying the success of the site with the challenges we were facing behind the scenes. Publicly, Sprouter was having success. We had a growing, vibrant community of startup founders, an incredible roster of experts giving advice and a brand that was becoming increasingly recognizable within its market. Unfortunately, while we had plans to introduce premium features that people would actually pay for, we ran out of money before we could get them finished. Running the site for free for so long, and relying on small sponsorship dollars to survive, we simply ran out of runway. It was my fault. It took me too long to figure out a tangible game plan, too long to realize we needed help and far too long to execute.

It’s easy (and excruciating) for others to pontificate from the sidelines. It’s tough for anyone to appreciate the millions of impacting factors that affected this decision.  Most people aren’t privy to the inner workings and rationale behind certain decisions that led us to this point. There were a lot of extenuating circumstances - a lot of issues that we just couldn’t resolve. The full story isn’t available for debate. Maybe some day, I’ll write a book and divulge all.

Unbelievably, this story has a happy ending. I think everyone was completely unprepared for what happened after we announced we were shutting down. The thousands of emails that came flooding in, the uproar of the community and the amount of people that came forward to keep it going was astounding. We were truly blown away by the reaction. Within a few days of the announcement, we had multiple acquisition offers. Within several weeks, we had been bought. It was a completely surreal experience. And it definitely makes for one hell of a story at cocktail parties.

2. How can marketers and entrepreneurs benefit from your experience from nearly shutting down a company you worked for years to launch?

I’m sure there are a lot of lessons but the most obvious should be the absurdity of offering services for free - without a way to convert those users to paid. We had a long-term plan, but wildly underestimated the amount of time it would take us to get there. Obviously, cash flow is everything and we let it get too tight. The responsibility of a founder is to ensure ample runway to execute priorities and build the company. I fucked up. As my friend Micah Baldwin eloquently put it at a recent Sprout Up event, the rule for founders is simple: “don’t run out of cash”.

3. In what ways has Sprouter’s partnership with Postmedia Network inc. expanded your vision for your company?

Being acquired was obviously game changing. We had multiple offers on the table and it wasn’t just about money - it was about vision, culture and the future. Postmedia was the best fit. We clicked with their team instantly; even more, they shared our vision and wanted the founding team to come back. It was the best in all aspects; an exit, a continuation of the community and a second chance to bring the full vision to fruition.

Being part of the network has given us insights into the media industry and connected us with some incredibly well seasoned professionals. It’s been a positive experience and we’re hard at work building a new Sprouter that will debut shortly.

4. What was the best advice you were given when you were trying to launch Sprouter.com?

No advice is ever quite as impactful as the lessons learned from personal pain but I’ve certainly benefited from a lot of great advice from the incredible thought-leaders on Sprouter. I think it was Ash Maurya who said it first: “fall in love with the problem you’re solving - not the solution”.  Simple but incredibly sage advice. A lot of founders are guilty of falling in love with their product - it’s easy to get caught up in cool features and lose sight of that core problem that needs solving. Keeping the original problem front and centre is an important mindset for every entrepreneur to have. In fact, the line resonated with me so much that I have the words framed and hanging in my office.

5. As a person who has built a company helping other entrepreneurs start and maintain their businesses, what is the golden rule, in your opinion, of entrepreneurship?

The golden rule of startups is two-fold: tenacity and persistence. The dirty secret of entrepreneurship is that persistence is necessary for most startup successes. Unrelenting, gritty, pull-yourself-out-of-the-dirt persistence. For the vast majority, success only comes after long periods of fighting. What seems to separate the winners from the losers is the amount of fight in the founder. Stay alive and fight as long as you can.

MARKETING MOMENT: The dirty secret of entrepreneurship is that persistence is necessary for most startup successes. Be persistent and follow your gut instinct.

CONNECT: @sarahprevette @sprouter

5 Minutes With… Greg Selkoe, CEO of Karmaloop.com and Karmaloop TV

Five Minutes With is a new column highlighting the work and insights of great youth marketers. This week, we chat with Greg Selkoe, Founder and CEO of Karmaloop.com and Karmaloop TV. Selkoe founded Karmaloop.com in 2000, and in 12 years, the company has reached revenues over $130 million, launched KarmaloopTV, and has 11 “private label”apparel brands under the Karmaloop umbrella. Selkoe has, in essence, become a very powerful voice in Millennial marketing, and he’s known for his authentic approach to reaching this market. Here he answers five questions and leaves us with a key Marketing Moment.

1. What advice would you give Millennials who are interested in launching a fashion retailer during this turbulent economic climate?

I would say that businesses can exist in any economic climate but certainly it’s more of a challenge in the current one. Come up with an idea that is really good and plan.  Keep in mind that it’s very difficult to start a business so you have to go into it with the right mindset, which is that you are never ever ever ever going to give up. I think Millennials are in a unique position to revolutionize the fashion and retail world because their global influences are so much deeper and richer and more diverse than even the generation before them. This is due to the incredible growth of the Internet and the understanding of world cultures. Furthermore, their design skills and other skills are aided by technology and that means that they’re generally able to better articulate ideas visually than other generations.

2. Name one of the biggest challenges you faced when launching Karmaloop in 2000.

One of the biggest challenges I faced creating Karmaloop, was the lack of belief in my project by people I was approaching to invest. I had no business skills, little money and lived at home. I was able to overcome those obstacles because of my belief in the culture and the future of e-commerce. I had to learn a lot and make a lot of mistakes but again, once I got into it, I set my mind to accept nothing but eventual success and was willing to suffer or keep at it as much as needed in order to get to those goals.

3. What’s next for Karamaloop.com?

We are working on so many things! For one, Brick Harbor, which is Karmaloop’s skate site, launching soon. Our Karmaloop Rep Team just hit 100,000 worldwide reps and we are about to launch a brand new Karmaloop Rep site with updated functionality.

We also recently launched Boylston Trading Co. (www.BoylstonTradingCo.com), which is like Karmaloop but a higher-end clothing site for men. KarmaloopTV.com is launching a brand-new, much bigger, better and more technologically advanced website in the spring. We are continuing to work on Karmaloop TV with Pharrell Williams, who serves as Creative Director. For this, we are working on a longer format channel strategy with both the cable industry and the new over-the-top plays like our YouTube premium channels.

Karmaloop also launched PLNDR.com a year and a half ago and it’s continuing to explode. We’re keeping on top of that and making sure we can meet demand. We also have Karmaloop Europe and Karmaloop China launching in 2012.

4. Tell us about a marketing highlight in your career. When did you realize Karmaloop.com was gaining popularity?  

There are many, many marketing highlights in my career so it’s hard to pick a few, but certainly I think the implementation of the Karmaloop Rep program, our customer evangelist program, has been far and away the biggest highlight and the most valuable marketing tool. Basically, we enlisted our customers as our marketers. These are people who believe in the brand and the culture passionately so they are authentic for their love of Karmaloop.  What we’re trying to do couldn’t have been more palpable to those learning about Karmaloop. These Reps that bust their asses to promote the company are rewarded by points that they can use for free clothes and now even cash. There are many Reps that support themselves just by repping Karmaloop.

These Reps are more than just marketers. They are extensions of the brand and the family. They do things from posting on message boards on Facebook and Twitter, off-line events, creating flyers & creative pieces, creating content for Karmaloop’s Blog etc. For us, they are the heart and soul of Karmaloop.

It was the incredible interest and excitement that our customers showed in Karmaloop when we were just beginning that was the impetus for the Rep program. It really sprang up organically because customers were willing to promote, without any compensation, and I saw this enthusiasm and said: “Hey we need to harness this and really utilize and focus these guys and girls to help us grow our business.” Against all these odds that we faced, it was the Rep team that was and is like an unstoppable force and I’m grateful for each and every one of them.

5. How do you keep your products, designs, promotions, etc. original and dynamic? Where do you draw your inspirations for Karmaloop.com?

I draw my inspiration from many places and although it is terrific that I’ve been able to make a lot of money from starting my own business, a big reason why I get up and I approach each day with the same amount of interest is the inspiration I get from our customers, brands and the creative people in the music industry and others that are part of the culture that Karmaloop is part of.

Even though I have no illusions that at the end of the day, we are a business and we’re selling product, we still have a lot of social influence for psychosocial movement to promote Verge culture: which is the multiracial & multiethnic first-generation that has grown up on the Internet. They don’t conform to a lot of the stereotypes and stratification that has been so negative, in my opinion, in America and the rest the world. Karmaloop’s audience is often misunderstood, pigeonholed or labeled. But the reality is, it is our audience that is shaping and defining youth culture, and by extension, popular culture around the world.

This is a group of kids and young adults that are Type A personalities, who are interested in the world. They’re entrepreneurial, they’re creative, many have their own clothing lines, they’re musicians, they’re artists and the people that you don’t hear about accurately in the media. They are  a smaller percentage of their demographic age group, but a growing one and it makes me hopeful for the future. Pop-culture & subcultural social movements, as well as youth movements and cultural movements of the past, all informed how I view the world and what inspires me.

MARKETING MOMENT:  Leverage the loyalty of your customers. Create an ambassador program, and allow them to participate in the process.

TRENDY TERMINOLOGY: Verge culture, which is the multiracial multiethnic first-generation that has grown up on the Internet.

CONNECT: @selkoe and @karmaloop

Top 10 Trends of 2012

Every year I put together a list of predictions. Here’s my predictions for 2012.

1. Conscious Consumption — Millennials are still consuming. The recession proved to be more of a reset button, allowing them to focus on what’s important. Brands like TOMS shoes and FEED are examples of how Millennials are purchasing great products while supporting philanthropic causes at the same time. This is a trend that’s here to stay.

Read more here.