Pod Insights How I Built This with Guy Raz Advice Line with Bobby Trussell of Tempur-Pedic About this episode Tempur-Pedic founder Bobby Trussell joins Guy on the Advice Line to answer questions from three early-stage founders. Plus, Bobby talks about his new book, The Logic That God Exists.
First, Lyf from Oregon asks about how to expand his fresh seafood business. Then, Colleen from Colorado has questions about where to focus her efforts in growing her whitewater paddleboarding company. And finally, Amanda from Illinois looks for advice on fundraising for her lifejacket brand.
Thank you to the founders of Flying Fish Company, Hala Gear, and Line + Cleat for being a part of our show.
If you’d like to be featured on a future Advice Line episode, leave us a one-minute message that tells us about your business and a specific question you’d like answered. Send a voice memo to [email protected] mailto:[email protected] or call 1-800-433-1298.
And be sure to listen to Tempur-Pedic’s founding story https://wondery.com/shows/how-i-built-this/episode/10386-tempur-pedic-bobby-trussell/ as told by Bobby on the show in 2018.
This episode was produced by Chris Maccini with music by Ramtin Arablouei. It was edited by Andrea Bruce. Our audio engineer was Cena Loffredo.
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5:27 Speaker 00 Hello and welcome to the Advice Line on How I Built This Lab. I'm Guy Raz. This is the place where we help try to solve your business challenges. Each week, I'm joined by a legendary founder, a former guest on this show, who will help me try to help you. And if you're building something and you need advice, give us a call and you just might be the next guest on the show. Our number is 1-800-433-1298. Leave us a one-minute message that tells us about your business and the issues or questions that you'd like help with. All right, let's get to it. Joining me today is Bobby Trussell, founder and former CEO of Tempur-Pedic. Bobby, welcome back to the show.
6:04 Speaker 01 Thanks, Guy. Great to be here.
6:06 Speaker 00 It's great to have you. You were first back on the show in 2018. I love your story. A lot of people ask me what my favorite episodes are, and I can't answer, but I do cite yours often because it's such an unlikely story. You are in Kentucky. You started your career in horse racing. You were reading thoroughbreds. And when you were in your 40s, there was a recession, the money dried up, and you were about a million dollars in debt. I mean, you were more than broke. And through an unusual connection in the horse world, you came across a product in Sweden, of all places, that we now know as memory foam. And you thought this could make the perfect mattress. And you basically gambled everything. You brought it to America, and you made mattresses. And you've essentially
6:50 Speaker 00 built Tempur-Pedic from scratch. It's just an amazing story. And for those of you who haven't heard it, we will put a link to it in the show notes. This is an episode from October of 2018. It is so good. It's like a movie, Bobby. Your life is like a movie.
7:07 Speaker 01 Yeah, it is. It is. I'm still pinching myself.
7:10 Speaker 00 It's incredible. I mean, you eventually acquired a huge rival, which was Sealy. This is in 2012. And then you stayed on as vice chairman of the board until, I think, just a few years ago.
7:21 Speaker 01 Right. I went off in 2022. So I've been on for, at that point, we started in 92. So that's 30 years. That's enough. Because what happened after I stepped down as CEO in 2006 was crazier than what happened before. And so I was around for all the ups and downs for that, too.
7:42 Speaker 00 Yeah. It's an amazing product and amazing business. Bobby, you have, since you have kind of stepped away from Tempur-Pedic and that world, you have really leaned into your faith. You publish a book about, is it The Scientific Proof of God?
8:01 Speaker 01 The book is called The Logic That God Exists. And so when all this happened to me, I just was trying to find a way to support my family. And I ended up in this mattress thing, you know, CEO of a public company on the New York Stock Exchange. I said, Lord, I said, You know, when you give, you give gratuitously. And so my, my goal now is just to give back for that. And just in any way I can. And so the book kind of sprung out of notes I had taken over the years from various, you know, lectures and thoughts that I had and books I've read. And what I observed in the culture out there is that there was a general weakening in the
8:46 Speaker 01 belief in God. And so, you know, as a Catholic, you know, I, I go to church and the priest is trying to get people to go to confession and go to this and go to that and sacraments and all that. And I was realizing that we're trying to get people to go to step B and C in their faith. They're still stuck on step A.
9:04 Speaker 00 Yeah.
9:04 Speaker 01 Let's focus on that niche and, and research it and write a book that explains how it's impossible for there not to be a God.
9:14 Speaker 00 Yeah, it's interesting because I mean, you know, for so long, the fastest growing quote unquote religion in America was, was no religion, right? And, and or no belief. And there's some anecdotal evidence that I don't know how, how closely measured is that there is a little bit of a resurgence happening in the United States around faith. And so we'll see if it's real or not, but it's, it's interesting because I think, you know, these things happen for, for a variety of reasons. So it'll be interesting to see.
9:44 Speaker 01 Yeah. I was at a leadership conference last week or two weeks ago, and we broke out in small groups. And I had a bunch of Gen Z, you know, 23 to 28 year olds. And I asked them that question. And I said, Do you see like a revival in your, in your age grouping? And they said, Definitely.
10:04 Speaker 00 Interesting.
10:05 Speaker 01 Why? And this one girl said, 23 year old, she said, that it's because we have everything at our fingertips with these phones and the technology. We can talk to anybody in the world. We can order anything we want. We have everything in the world, but we're not happy.
10:24 Speaker 00 Yeah.
10:24 Speaker 01 So they're seeking. And I think that's, that's explains it.
10:28 Speaker 00 Yeah, it's amazing. Well, let's start on the show today. Let's see if we can give some advice to some early-stage founders. Are you ready to take some calls? I'll try. I'll do my best. Yes. All right. Let's do it. Let's bring in our first caller. Welcome to the advice line. You're on with the legendary horse trainer Bobby Trussell, Tempur-Pedic founder. Please tell us your name, where you're calling from, and a little bit about your business.
10:53 Speaker 02 Yeah. Hi. Thank you so much for having me. This is such a pleasure to be on the show. Bobby, thank you so much for all your words and advice. And Guy, you're amazing. My name is Leif Gilderslieve. I'm calling in from Portland, Oregon. I'm a second-generation fishmonger.
11:07 Speaker 00 Nice.
11:08 Speaker 02 And I own a business in Portland called Flying Fish Company, and we are a retail fish market and restaurant.
11:14 Speaker 00 Awesome. Welcome to the show. And so you come from a family of fishermen?
11:19 Speaker 02 I do. Well, from fishmongers. So my family, yes. So my family had a fish market in my hometown over in Idaho, growing up as a kid. So my dad used to fly in fish from the coast, from Seattle, fly it inland where there wasn't good seafood. And so the name of the company is Flying Fish Company.
11:37 Speaker 00 That's awesome. And how long have you run this business?
11:40 Speaker 02 So I've had my own branch of it since the recession in 2008, 2009. And then I moved it. So here in Portland, it's been about 15 years.
11:49 Speaker 00 Yeah. And so it's a store where you're a fishmonger. You go in, you get fresh fish, but it's a restaurant is attached to it?
11:56 Speaker 02 That's correct. Yeah. So I started my early years here in Portland. I started just, I was just selling fish, first of all, from farmers' markets. And then I had a little truck where I would park on parking lot corners and sell fresh fish from the truck. That evolved into different phases, different locations. In my early years, I had a little shack on the corner of a produce tent. And then I ended up in a high-end grocery store where I was the fishmonger. And I had a meat market in there and a cute little oyster bar. And then, well, almost six years ago now, right before the pandemic, I moved into my own standalone brick-and-mortar location, which was a full sit-down seafood restaurant, along with the fish market. So it's kind of evolved over the years.
12:38 Speaker 00 That's awesome. And give us a sense of the split here. I mean, what part of your business? It's kind of two businesses here, right? You've got the fish market and you've got the restaurant. What generates more revenue?
12:53 Speaker 02 Well, you know, as I said, in the early years, it was all fish market. So 100% of my revenue was from the fish market. I evolved that into, I started producing smoked salmon for grocery stores and I was selling fish wholesale to restaurants. And then, you know, I had enough people that kept on asking me to cook the fish because it is, in some people's eyes, challenging. So that's when I started doing more of the cooked seafood and pivoting more into the restaurant component. Now, the restaurant has pretty much taken over. It's over 75% of the sales is the restaurant, whereas only 25% is the fish market.
13:27 Speaker 00 Wow. So, okay, tell us your question and then we will dive in further.
13:31 Speaker 02 Yeah, thank you so much. Bobby, so similar to how you pivoted from mattress toppers to pillows and then started to see that part of the business grow. I've also pivoted, like I said, into different categories of the business. So, you know, my question is, I'm interested in growing again. I've been running the business now, like I said, for about 15 years. So my question is, is how do you really know, when you're doing those pivots and you start to see some feedback, you're starting to get sales. How do you know when you've kind of landed on the one part of the business that you think that you should really put the most effort into? Like I said, I kind of want to grow right now, but I'm figuring out whether I want to do more locations here within the Portland area.
14:12 Speaker 02 Or maybe even franchise it so that I can branch and expand more nationally to people that don't know about flying fish. How do you know when you've landed on that one part of the business?
14:23 Speaker 00 Yeah, that's a good question, Bobby, right? Because this is sometimes can, can, it can just expand and set a business on a rocket ship or can actually tank a business if you expand too quickly. Bobby, he's got a very successful restaurant and a fish market. And it would make sense to start thinking about expanding, but when do you know?
14:45 Speaker 01 Yeah, I mean, my gut reaction would be to open up another location or two. That's what restaurants do, right? They get a template that works and they reproduce it in other locations, you know, often in the same city. But I would think that that would be the way to go. And the other thought would be as far as how do you know which one's getting legs? What we did is we threw mud at the wall to see what would stick. And generally speaking, if it's a good one, it'll let you know early on. I remember when we tried things, we got several chiropractors and we sent them these
15:30 Speaker 01 overlays, which were three inch mattresses. And so we tried selling it at truck stops because we thought it'd go good in the back of the cabs for the semis. And that, we didn't sell any. And then we tried the pillow. And that, when I took it to a chiropractor, he said, oh, this is interesting. By the way, we sell pillows. We don't sell mattresses. And I said, well, how would we distribute it? And he said, well, if you could find a way to have somebody show it to them. And I said, well, why don't you mail them one? And he said, well, it might work. And then that's what we did.
16:10 Speaker 01 We mailed them, we mailed the 500 chiropractors and 125 of them took up our offer of which was this pillow is yours free if you order four. So now we have 125 distributors. So that was example of it. It was like one of your fish. It hits the hook and you go boom.
16:32 Speaker 00 Yeah.
16:33 Speaker 01 I got one here.
16:33 Speaker 00 And you feel it. Yeah, I think, okay, so I think I got some thoughts here because, Leaf, it sounds like... You're sort of trying to figure out, right? Do I franchise this thing? Do I expand or build a restaurant? And so here's what's interesting to me, right? If the restaurant is generating about 75% of the revenue, your customers have already told you where the demand is, right? It's the restaurant. But I suspect the reason why the restaurant is so successful is because of the trust and credibility of the market, right? Because they're going in there, they're seeing, oh, they've got direct sourcing and they're getting really fresh fish. So they could see the fish in the market. And then they go to the restaurant and they know what they're eating.
17:18 Speaker 00 And so, I mean, to me, it seems like a fairly straightforward path, which is, I don't think you're ready to franchise now. I think you have to test first, right? You've got to figure out whether this is replicable first, which means if you can get the financing, open a second location. See if you can replicate the success of the first one with that model, with the market, with the restaurant. And then you start to evaluate. You know, you need some data to figure that out because franchising is a different business, right? Now you are a restaurateur. A franchise operator, it's systems, it's documents, it's training, it's protecting your brand, it's supply chains, it's providing financing.
18:03 Speaker 00 It's a whole different type of business, which is an interesting business. But first you have to see whether you can actually have success with this model in another location, maybe in Portland, maybe somewhere else in Oregon, maybe wherever. And that will give you the data.
18:21 Speaker 02 Yeah, you know, one of the things that came up in my thought when you were saying that is I do agree with that, with the scalability and make sure that it works. One of the problems is staffing. You know, I've got a great general manager and a chef and they really run the ship right now and all my employees. And we've found ways to do profit sharing and health insurance. And we do equal tip share.
18:42 Speaker 00 Wow, that's hard to do. That's hard. I know so many restaurants that have not made it because of that, right? That's hard.
18:49 Speaker 02 Yeah, it's great and they they do a great job because there's accountability there and that. So my fear is when I go to do another location, you know, I don't have those same people. So I'm gonna have to build it again. And I'm a guy with a lot of energy and I've been there, boots on the ground and done all this. But it's also super complex because Leaf Gildersleeve is there doing eight trillion different things. What I have to do is I feel like I have to pull back and make sure that for that scalability, that it's a real simple model. Because right now, it kind of gets more complex as I do all these different facets of the business because it's me involved. But when I scale it, I've got to go backwards a little bit and make it simplified because seafood is pretty difficult, just as it is.
19:32 Speaker 00 Do you have a like a Bible, like a that really out that describes what you guys do, how to do everything, like a manual?
19:42 Speaker 02 You know, it's sort of, sort of, kind of, but not really.
19:46 Speaker 00 Okay, great. That's great. That's great. That's great. That is the that's something that you should really lean into because
19:53 Speaker 02 Thank you.
19:53 Speaker 00 if you want to train people, like people might be coming to see Leaf, they might be coming to see you, right? But you can't scale yourself. But you also need people who are going to care about the quality and the standards like you do, but they need that you need to you need to codify it, not only in how to do things, but why you do it. You guys had a brand Bible at I'm sure at Tempur-Pedic, Bobby?
20:16 Speaker 01 Yeah, it took us a while, but we but we did. Yeah. This is what we learned when spreading into other countries. We we had this mattress operation here. But they made me CEO of the group, which included 26 countries. So all of a sudden, under my purview was, you know, Spain and France and Japan. And what I learned there is you're only as good as the guy you got there.
20:46 Speaker 00 Yeah.
20:46 Speaker 01 If you have a good guy in Spain, Spain's gonna do great. If you have a marginal guy, Spain's not going to do well. So if you can get comfortable with the guy, and then yeah, have the handbook and have have have the rules and what to do. But it's mainly getting that guy and make it worth his while. Pay him whatever it takes. And because what you're trying to do is reproduce you. And I think that's the best advice I could give.
21:11 Speaker 00 Yep.
21:13 Speaker 00 Awesome. Leaf, thanks so much for calling in. Leaf Gildersleeve, you've got one of the best names in the fish business. Leaf Gildersleeve from the Flying Fish Company. Good luck, man. Thanks for calling in. Thank you very, very much. I appreciate you guys. Awesome, man. Thank you. Stay with us because after the break, we'll talk to another founder working to take their business to the next level. That's after the break. I'm Guy Raz and you're listening to the Advice Line right here on How I Built This Lab.
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24:20 Speaker 00 Welcome back to the Advice Line on How I Built This Lab. I'm Guy Raz and my guest today is Bobby Trussell, founder of Tempur-Pedic. And we are taking your calls today. And let's bring in our next caller. Welcome to the Advice Line. You're on with Bobby Trussell, founder of Tempur-Pedic. Welcome to the show. Tell us your name, where you're calling from, and just a little bit about your business.
24:38 Speaker 05 Hi, Guy, hi Bobby. My name's Colleen King. I'm based out of Steamboat Springs, Colorado. And my business is Haula Gear. So we manufacture specialty inflatable stand-up paddle boards with a focus on river performance through unique and patented features. People use our boards on a lot of different waterways from flat water to their local river, all the way to pushing the upper limits of whitewater.
25:02 Speaker 00 All right, cool. Welcome to the show, Colleen. This is so paddle boarding. People know, a lot of people know you go to the ocean. You got a big paddleboard and you paddle. But this is, these are, you make paddleboards for rivers? For like whitewater rivers?
25:16 Speaker 05 Yes, yes.
25:17 Speaker 00 So it's a different kind of paddleboard?
25:19 Speaker 05 Yes, exactly. Yeah, we really focus on design that allows for performance on the river specifically. Of course, we have boards that can go in flatwaters and lakes, but our specialty is the river market.
25:30 Speaker 00 Okay, so these, you stand on this thing. You're not, you're not like locked in, right? It's not like a snowboard. You stand on it with a paddle and you go on a whitewater river? And you somehow manage to stay on it?
25:42 Speaker 05 Yes, that's correct. We even have some folks primarily in Scotland that are dropping waterfalls, not locked in, standing on the board.
25:50 Speaker 00 This is a, I love this call because this is a niche product, okay? And I don't mean, I mean that in the most respectful way. And I love those kinds of products and they can be great businesses. How did you just get into this business? What's the story?
26:03 Speaker 05 So I'm actually recently the owner. We switched ownership two years ago. I worked for the company for about six and a half years.
26:11 Speaker 00 And when you say company, was it a bunch of people? What was it?
26:15 Speaker 05 We had about 20 employees. And we owned Hala. And then we also owned an online whitewater retail store called CKS Online.
26:23 Speaker 00 Okay, and you are now the owner?
26:25 Speaker 05 And I'm now the owner.
26:26 Speaker 00 How did that happen?
26:28 Speaker 05 Yeah, so after COVID, there was kind of the boom and bust of the outdoor industry. We got put in a position where we had canceled orders, a bunch of financial strain. And I was able to put in an offer to our founder, who's still very involved. He's our lead designer amongst many other hats he wears. And yeah, took over the business last May.
26:49 Speaker 00 All right, so you sell these boards and I'm assuming mainly online? Or do you sell them in shops?
26:54 Speaker 05 We started out in 2011, primarily B2B. And now we're about 85% direct to consumer online and then 15% to shops.
27:05 Speaker 00 And what do you expect? Give me a sense of what you expect to do this year in sales.
27:09 Speaker 05 We're forecasted to finish at about 850,000.
27:13 Speaker 00 850,000 this year?
27:15 Speaker 05 Mm-hmm.
27:15 Speaker 00 Wow, that's great. That's awesome.
27:17 Speaker 05 It'll be our second year in a row of being profitable.
27:20 Speaker 00 That's great. And before we dive in further, what's your question for us?
27:24 Speaker 05 Yeah, so my question is, after switching ownership and clarifying our identity as Premium River SUP, how do we grow our revenue from here? Do we invest in increasing participation and education around the sport? Do we focus on expanding our presence in specialty shops and river communities? Or do we work to develop adjacent product lines for core river paddlers?
27:46 Speaker 00 Got it. Okay, SUP stand-up paddle boarding?
27:48 Speaker 05 Correct.
27:49 Speaker 00 Right, okay, I just want to clarify that. Okay, I don't always agree with acronyms. Okay.
27:53 Speaker 05 Yes.
27:54 Speaker 00 Let me bring in Bobby Trussell. Bobby, you started with a very obscure, weird product that people were like, what is this? This is, of course, a niche sports product. First of all, thoughts, questions, answers for Colleen?
28:07 Speaker 01 Question, I guess, is this a market that you created? Or is it an established market that you're a small part of?
28:18 Speaker 05 Yeah, excellent question. We were the first company to design a board specifically for whitewater. So from the beginning, we've been pioneering the sport. And now there's some competition in the space, but we still are the go-to river paddleboard company.
28:33 Speaker 01 Well, I can just tell you, from my experience, we were at a kind of a crossroads. We're about 10 years in, and we did some research from Bain Capital. And we had been branching out into chairs, because the material was so cool. We thought, my Swedish partners thought that, oh, well, they didn't think of us as a mattress company. They thought of us as a innovation company, where we have this wonderful material. Yeah, we can put it in mattresses, we can put it in chairs, we can put it in insoles in your shoes, we can put it in hospitals, and nursing homes, and wheelchair cushions, and all this stuff.
29:15 Speaker 01 And so we were kind of going every which a way. And these guys at Bain Capital, and I was really kind of against this, because it cost $200,000. I said, are you kidding me? We're going to spend 200 grand to get an opinion about our business. Well, they called 500 of our stores that we were in. And when they got done, they knew more about us than than we did. And they came back and they said, you are a very small part of a very big niche. At the time, we were we were positioned the mattress as kind of like, if you need, if you have back pain, you need this, you need Tempur-Pedic. And so they said, you should not be branching out into all these other places. Because you don't want to take your eye off the ball, off your core business,
29:59 Speaker 01 especially if you are have a niche that there's still competition. I mean, we were a revolutionary point of difference compared to the kind of the the old inner spring industry. I mean, that's for 100 years, it had been just inner springs. We come out with this fancy foam thing that had actual tangible and measurable benefits. And they say, you need to stop doing all this, focus on you. You are a mattress company. And that changed everything. And I went back to the Swedes, my Swedish partners, and I said, well, this is what they said. I agree. And so we got rid of all the other stuff.
30:41 Speaker 01 And so that's when the thing took off, when we focused on our core business. And the fact that competition comes in, that can be a positive thing. Because what you want is your niche to get bigger, right? You don't want to be the only the only fish in the pond. So what what happened with us is people copied us or tried to, but they didn't do it as well. But it made the niche more acceptable, which we dominated.
31:12 Speaker 00 I totally agree. I think that that right now, it sounds like you are the brand, right? In in river stand up paddle boards, paddle boarding. And and so you really want to lean into that that role, right? And and even though this is kind of a niche sport, right? And paddle boarding is bigger, but but river paddle boarding in particular is niche. It still has a, it sounds like a really committed, you know, fan base. So you want to make your brand aspirational, right? Like, almost like how Patagonia really began with like, Rock climbers, right? And that was a niche sport back in the day, right?
31:51 Speaker 00 And you really want to double down on this idea that your customers are part of a culture. Like, when I look, and you may be doing that, I don't know. When I look at your website, it's clear. You've got your shop and everything. But I think that there's an opportunity to really lean into the people who are using your products and to see if you can start to generate photos, videos, content that really builds a community, right? Because this is a group of people who are, I mean, how many people do you meet who are like, "I stand up paddleboard in rivers, in whitewater." So, I mean, that's a community of people that you really want to cultivate and own.
32:33 Speaker 05 Right. Yeah, I think that's good advice. We definitely struggle to have people visualize themselves doing this because it seems there's a barrier to entry in a bit. But, once people try it, they feel that sense of community. They understand what we're all about. They understand the adventure and the connection to themselves and the environment and other people in an expedition way. You know, we're pretty limited in resources. We're very small. So, it's hard for us to know, do we invest that in going to shows and river events? Or, once someone buys one of our $1,400 boards, we have, our customer retention rate has increased by 60%.
33:18 Speaker 05 So, we have a loyal following. We just have such limited funding to know which way to focus our attention on the river community.
33:28 Speaker 00 Have you experimented with ads?
33:30 Speaker 01 Yeah, I was just going to say, we were in a similar situation early on, selling through chiropractors. And we went to all the shows and everything. It was really a waste of money. You know, we go to a show and we spend... Five grand or something and we get, you know, 10 chiropractors. It just wasn't cost efficient. And so my advice is advertise what Guy just said. Advertise, advertise, advertise it.
33:56 Speaker 05 Okay. Yeah, we only spent about $10,000 on advertising last year. We were a bit inventory constrained. So I think, I think that's great advice. Thank you.
34:07 Speaker 01 A rule of thumb is 10% of sales.
34:09 Speaker 05 Okay.
34:10 Speaker 01 So you should be spending 80.
34:12 Speaker 05 Yeah.
34:13 Speaker 00 It's hard. I'm sure that sounds hard, but, but he's right. That's right. It's a rule of thumb. All right. Colleen, the brand is called Holla Gear Stand Up Paddle Boards. Thanks for calling in. Good luck.
34:21 Speaker 05 Great. Thank you so much. I really appreciate your time and advice.
34:24 Speaker 01 Thanks, Colleen. Good to meet you.
34:26 Speaker 05 You too.
34:27 Speaker 00 Yeah. I mean, have you ever done stand up paddle boarding, like on a, on the, in the ocean?
34:33 Speaker 01 No, my wife has. But I'm 6'6" and my center of gravity does not, not conducive.
34:38 Speaker 00 Yes. Yeah, right. Cause you got, I can't imagine that. Yeah. Right. But it's great. It's great exercise, actually. It's really terrific exercise.
34:46 Speaker 01 Is it? I mean, I see them out there all the time.
34:48 Speaker 00 Yeah, it's great. Great for your shoulders. Awesome. So this just, I, I think it's amazing to imagine somebody, you know, in flat water in the ocean, I'm barely, you know, able to stay on top of it. But man, doing this in like whitewater, that's, that's intense.
35:03 Speaker 01 Yeah, that takes some skill, I would think.
35:05 Speaker 00 Yeah. All right. We're going to take another quick break, but we'll be right back with another caller. Stay with us. I'm Guy Raz and you're listening to the Advice Line right here on How I Built This Lab.
35:30 Speaker 00 Welcome back to the Advice Line on How I Built This Lab. I'm Guy Raz and I'm taking your calls with Bobby Trussell, founder of Tempur-Pedic. All right, let's bring in our next caller. Welcome to the Advice Line. You're on with Bobby Trussell. Welcome. Tell us your name, what you're, where you're calling from, and just a little bit about your business.
35:45 Speaker 06 Hi, I'm Amanda Haran, co-founder and CEO of Line & Cleat, the only women-owned US Coast Guard-approved life jacket brand in the US, based just outside of Chicago. We're redefining how modern families experience safety on the water.
35:59 Speaker 00 Awesome. Well, thanks for calling, Amanda. So this is a life jacket brand, right?
36:04 Speaker 06 Yes.
36:04 Speaker 00 Is that right?
36:05 Speaker 06 Exactly.
36:05 Speaker 00 And tell me, what is it? What do you guys do? I mean, I know life jackets. I've been on ferries and on boats. And you put on a life jacket, it's usually orange.
36:14 Speaker 06 Right, and probably not attractive, right?
36:17 Speaker 00 Yeah, I mean, I just put it on, right? And so what? Tell me about what you're doing here.
36:23 Speaker 06 Absolutely. So my husband and I, he's my other co-founder, we started the business, launched the collection in 2023. And so we design with elevation and like an elevated lifestyle in mind. And so we are bringing subtle colorways to the life jacket game. The industry's been stagnant for decades. Just like you said, a utilitarian, kind of not-so-attractive life jacket is the first thing that people think of when they think of life jackets. And it dawned on us that this is a huge blind spot in this industry and in this market. And so when we launched the collection, we really wanted to speak to those leisure boaters and water enthusiasts that are not looking to go jet skiing and not looking for that like intense water sport,
37:08 Speaker 06 but really looking to carry on those family traditions and just enjoy time together out on the water.
37:15 Speaker 00 And these are life jackets for kids?
37:17 Speaker 06 We started with our kids' collections. So that was our first launch, so 0 through 90 pounds, infant, child, and youth. But we are launching universal adult sizing for spring 2026.
37:28 Speaker 00 Got it, okay. And how did you get into life? I mean, is this, did you come from a family of people going on boats?
37:34 Speaker 06 My husband did, yeah. So my husband grew up on the Mississippi River in Iowa, and his father passed down all of, you know, his boating traditions to my husband. And so when we got married, you know, we started boating. And we have two daughters. And so when we started taking them out, it really dawned on me as a parent that there isn't much choice. As much as you think you have all these brands to choose from, a lot of them read very one note. And if you look deeper into the industry, a lot of them are under only five larger umbrella companies. And I didn't love the way they looked. I felt like it was kind of an eyesore in this, the middle of this beautiful family moment. And we saw that there was an opportunity here. And very quickly after
38:19 Speaker 06 launching the first collection, we had rapid sales and it's been growing, I feel lucky to say, you know, very quickly since then.
38:27 Speaker 00 And you're selling direct to consumer through your website?
38:30 Speaker 06 Yes, 90% direct to consumer. We'd love to push wholesale too.
38:34 Speaker 00 All right, let's dive in. What's your question for us?
38:36 Speaker 06 So my question is, we recently opened our pre-seed round to bring on strategic partners and raise capital to meet the growing customer demand. But we're not from the traditional startup world. So I'd love some advice around breaking through that cold email phase and getting in front of VCs and angel investors with not having those established relationships. So any advice around that?
38:56 Speaker 00 All right. How much are you looking to raise, by the way?
38:58 Speaker 06 Our pre-seed right now is 400. We've secured 50. It's all a safe note with a $2 million cap.
39:04 Speaker 00 Okay. I have a lot of thoughts for you. I want to bring in Bobby. Questions for Amanda before we dive into her question?
39:12 Speaker 01 I guess on the product itself, is there a functional part of it that's a point of difference? Or is it just the designs?
39:21 Speaker 06 Great question. So most of life jackets out there are made with a very tough ripstop nylon. That's a little bit uncomfortable. We use a softer neoprene fabric that wears more like a swimsuit. And even on our nylon option, it's a much lighter weight nylon. So kids are less cranky when they're out there for a long time out on the water with their family.
39:41 Speaker 01 And how, how big is the market?
39:43 Speaker 06 Um, so it's a 1.3 billion dollar market and then we're hoping to move into boating accessories, which is even larger at 16 billion.
39:51 Speaker 01 Yeah. Well, that's important because, uh, so many people are used to looking at the downside of, of a business and fail to look at the upside.
40:00 Speaker 06 Mm-hmm.
40:01 Speaker 01 So where, how big can it be if it works?
40:03 Speaker 06 Right.
40:04 Speaker 01 Uh, not how much can I lose if it goes, goes wrong?
40:07 Speaker 06 Yeah.
40:07 Speaker 01 And so, uh, it's important to have, uh, a upside in the market, uh, in a niche that you're in and apparently you, you have that.
40:18 Speaker 06 Yeah, I, I hope so. I, I believe so.
40:21 Speaker 01 Yeah.
40:21 Speaker 00 Amanda, let me, let me ask you a question.
40:23 Speaker 06 Yeah.
40:23 Speaker 00 What do you, what do you want to do with the cash that you raise?
40:26 Speaker 06 So the majority of it is going to go to scaling inventory. Um, because we do have, right now, we have a waiting list, for example, for some of our best sellers. We get a lot of inquiries around wholesale accounts and we want to push to like luxury hotels and, uh, different avenues, but we are constrained on our inventory because we've been bootstrapped this entire time. So, um, it's really time for us to scale it. We, this would open up more collaborations for us. We've had a lot of interest around there. Um, but as the brand, we want to be able to support that, you know, product. Um, and so that's the majority. And then also making sure that once we get the inventory, we have the proper marketing to push it out to the proper channels to move that inventory through.
41:07 Speaker 00 So it sounds like, I mean, can you do part of this without, uh, without raising capital?
41:13 Speaker 06 We, we can. It's tight. We did, uh, recently create a partnership for some inventory financing. That's a little bit more unique, not your traditional bank financing, which has been a blessing. Um, but we've put everything we personally can into it. Um, and so we're also really looking from a strategy standpoint to, you know, maybe work with someone that has done outdoor products or children products or, you know, things that can kind of help us take this to the next level. And the feedback that we've gotten from VCs is we absolutely love what you're doing. Call us when you're bigger. You know, we, we love, we see potential here. We want you to hit that million dollar. So we've done about a quarter of a million
41:54 Speaker 06 so far. Um, but I know we can hit it if we have the inventory.
41:59 Speaker 00 It, it's, I'm, I'm gonna, so I'm gonna give you my take on this and I, and it's based on, you know, the people we talked to in the interviews we've done. Having a quarter million sales is hard to raise venture money. It's just hard, especially in a consumer product. It's really where you want to go to anyone you know, right? And so your question was like, how do we raise money when we don't have the connections and contacts? And the reality is, it's not about connections and contacts. It's about what the data shows, what you can prove. Because investors don't make investments because they know, they met somebody. They make investments because they think they're going to make money back, right? And they need that assurance. And so I wonder whether, I mean, you said you're outside of Chicago, right?
42:41 Speaker 06 Yeah.
42:43 Speaker 00 And you said you've raised about 50,000.
42:45 Speaker 06 Correct.
42:45 Speaker 00 Right, so far. And so I think that in order to attract, you know, significant capital, they are going to want to see data. For example, you know, if you were to get a distribution partner that, you know, where you're, I don't know, like, is there like a national chain of marinas or, or, or, you know, I don't know, yacht clubs? I mean, something that shows that you can actually scale.
43:11 Speaker 06 Right, right. No, that's a great point. And we have just partnered with a national e-comm distributor. So I think that that will really push.
43:19 Speaker 00 That's going to help.
43:19 Speaker 06 And I have a pitch next week, so I'm going to include that in my pitch deck. And then there's, you know, a prospect from the marina side that I'm hoping comes to fruition in 2026. But I think that's a great point to really drive that point home of the future.
43:33 Speaker 00 Bobby, how did you guys finance the first runs of the mattresses?
43:38 Speaker 01 We raised about $500,000 the first year, 1992. And we were in the same boat. We had very little sales at that point, but we had a good story. And we thought that we could show people that there could be a high degree of a big success.
44:01 Speaker 00 But who gave you that money, Bobby? Was it professional investors or was it people that you just kind of? New friends of a friends of a friend.
44:08 Speaker 01 Friends and friends of a friend, my college roommate, my mom gave fifty, my dad gave fifty. And the famous story about my Uncle Bill, who gave me fifty thousand.
44:17 Speaker 06 I listened to that on the podcast.
44:20 Speaker 00 I remember, you lost the check.
44:21 Speaker 01 I lost the check at a Burger King.
44:24 Speaker 06 But he sent you another one, right?
44:26 Speaker 01 He sent me overnight to me, and he had just lost a bunch of money with me in the horse business.
44:31 Speaker 06 That's right.
44:32 Speaker 01 And I thought, man, he's never gonna...
44:33 Speaker 06 He believed in you.
44:34 Speaker 01 But he did, and I told the story that that fifty thousand ended up paying for the college of all twenty-eight of his grandkids.
44:41 Speaker 06 It just takes one.
44:43 Speaker 01 Happy story. We did, here's what we did, we didn't want to give up equity, right? But we were okay with giving up some, so we gave for, if you give me fifty thousand, I, you'll get either one or two percent equity in the company, and a four to one payback on your money. So you give me fifty, I'll give you two hundred, plus one percent or two percent, whatever it was. So we raised money on those terms, that was Uncle Bill's terms. And that worked, because we, we gave up a small part of the company, you know, ten percent or something. And so equity is your currency. And, and you don't want to give it all up, but you gotta be prepared to give some of it up.
45:28 Speaker 01 And when we hit forty-five percent, where they own forty-five percent of our company now.
45:32 Speaker 06 Right.
45:33 Speaker 01 And I'm going, man, this is going the wrong way, but then we stopped. And it worked, so, and, and they said, years later, they told me that if, if they had gone over fifty, they would have felt like they had to run it. They didn't want to go over fifty either, so it all worked out.
45:48 Speaker 06 Yeah, they don't want to take it on, no, that's great.
45:50 Speaker 00 Yeah, I, I think that you want to start, and you prior to doing this, but, but you may have to double down on it. It's, it's, it's friends of a friends of a friends. Ask any conversation you have, and I, I remember getting this advice thirty years ago when I started as a journalist. They said, I was trying to figure out how to break into this business and people said, hey, call this person, but don't let, but when, make sure you walk out of that with another number or with another person to contact. It's very simple advice and, and it works.
46:20 Speaker 06 Yeah.
46:20 Speaker 00 So you're going to have to concurrently run this business, try to sell them, but also make the pitch to people.
46:26 Speaker 06 Right.
46:26 Speaker 00 That you know, because those are the ones who are going to, this initial round, I think it's going to be harder to get it from professional investors, VCs. They're going to want to see the data. They're going to want to see some traction.
46:38 Speaker 06 Sure. No, absolutely. I think that's a, I have to find my Uncle Bill.
46:42 Speaker 00 You gotta find your Uncle Bill.
46:44 Speaker 06 I thank you.
46:46 Speaker 01 And, and do a three-year pro forma, a projection. I know you're pulling numbers out of thin air, but it's really important and people like to see it that, okay, here's what the company's worth now, X, it can be worth 5X or 10X and that's, and therefore my investment could be worth that much.
47:05 Speaker 06 Yeah. We have that now. We've been consistently, you know, two and a half year over year since just launching in a short amount of time. So, but I, I see what you're saying, like really paint the picture for them. So that way they can see it.
47:17 Speaker 01 Show them the pot at the end of the rainbow.
47:18 Speaker 06 Right.
47:19 Speaker 01 If there's no pot, then why do it for them?
47:21 Speaker 06 Exactly. Yeah. There's a pot. I believe, I have faith there's a pot. Yeah.
47:25 Speaker 01 Good.
47:25 Speaker 00 Amanda, thank you so much for calling in. The brand's called Line & Kleats. Good luck.
47:29 Speaker 06 Thank you.
47:30 Speaker 01 Very nice to meet you.
47:31 Speaker 00 All right. Nice to meet you. Uh, yeah. I mean, I just, what I love is, is when you take a category that's just boring or you just, no one really thinks about it, you know, and, and you, you reimagine it, right? You, you sort of, you say, well, why does everybody accept that life jackets are, are orange with, with reflective tape on it? And let's make them a little more interesting.
47:52 Speaker 01 Yeah. Yeah.
47:54 Speaker 00 Bobby, before I let you go, and it's been great having you on as, as usual. You're just so great. If you could go back to, you know, to where you were when you were really in dire straits and, and not just trying to figure out what, you know, and you were starting out this thing, this became Tempur-Pedic, and you could give yourself advice now that you now know, what would have been helpful for you to know back then?
48:20 Speaker 01 Yeah, because we didn't know anything about our business. We didn't know anything about mattresses. And so, but it turned out to be that that was a good thing. So, you know, we did everything the opposite of how our competition was doing it. We had one size, everyone else had like 15. We had one price, everyone else had a bunch of different prices. We never discounted, everybody else discounted. We advertised nationally and everybody else advertised locally, which turned out to be a huge advantage because national ads are much cheaper per capita than local ads. And so, I mean, that was something that would have been nice if they had told me that.
49:05 Speaker 01 But, and the other thing is, we had some internal questions in the company of how big we wanted to be. Yeah. Because when we were selling to Brookstone, that was one of our big breakthroughs. They were a major retailer and we were, became the number one product and we were starting to really coin it. And so, the question is, do you want to be a niche player or do you want to be big? And my instincts were, we got to think big. And that's also what was a huge part of our success was just that mentality that we got
49:45 Speaker 01 something no one else has and we want to exploit that advantage.
49:52 Speaker 00 Bobby Trussell, founder of Tempur-Pedic. By the way, if you haven't heard Bobby's original episode, The Tempur-Pedic Story, go back and check it out. It's incredible. It's such a fun story. It's amazing. And here's one of my favorite moments from that episode. How did you raise the money to start this venture at all?
50:10 Speaker 01 Well, that's a really good question because I had to go back to all my basic same people who had invested with me in my other horse ventures.
50:21 Speaker 00 That failed, right?
50:23 Speaker 01 Yeah, that had failed and gone broke. So, I had to convince them that even though we lost money in something that I knew a lot about, that we were going to make money in something that I knew nothing about.
50:36 Speaker 00 Hey, thanks so much for listening to the show this week. And by the way, please make sure to check out my newsletter. You can sign up for it for free at guyraz.com or on Substack. And of course, if you are working on a business and you'd like to be on this show, send us a one-minute message that tells us a little bit about your business and the questions or issues that you're currently facing, because we would love to try and help you solve them. You can send us a voice memo at [email protected] or call us at 1-800-433-1298. Leave a message there and make sure to tell us how to reach you, and we'll put all of this information in the podcast description as well. This episode was produced by Chris Messini, with music composed by Ramtin Arablouei.
51:21 Speaker 00 It was edited by Andrea Bruce. Our audio engineer was Sina LaFredo. Our production staff also includes Alex Chung, Catherine Cypher, Casey Herman, J.C. Howard, Kerry Thompson, Ramel Wood, Sam Paulson, Niva Grant, and Elaine Coats. I'm Guy Raz, and you've been listening to How I Built This.
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