cc >> Jeanan Yasiri Moe: Good
afternoon, everybody. This
Society. It is a is Entrepreneurship in
through the University of Wisconsin School of Human
Ecology. I'm Jeanan Yasiri Moe.
We, of course, want to start by thanking our partners in this
course, the Office of Corporate Relations, the College of
Engineering Media Services for
providing us with space, and we also want to thank our financial
partners, the Ewing Marion
financing this course over the Kauffman Foundation for
able to provide it. They many semesters that we've been
of Kansas City, Missouri. We are a foundation based out
partners in this course, also like to thank our media
their University Place crew Wifor taping today's lecture.nd
I'm very pleased to introduce a special guest to this class
today. His name is
He is a 2006 graduate of Troy Vosseller.
undergraduate here he started UW-Sconnie Nation, a t-shirt an
company which he continues
Troy's company focuses on producing apparel that targets
people who herald from
people who go to school here, Wbut in some way identify withe,
Sconnie. And I know that Troy is going to
share more with us about what that means, that identity means
in his talk. After earning
degree, Troy went on to earn his undergraduate
management and a law degree, his MBA in entrepreneurial
And in addition to running both here from the UW.
works as a supervising attorney with the UW Law School's Law and
Entrepreneurship Clinic. That's a program providing free
legal services to start-up
Please join me in welcoming Troy businesses and entrepreneurs.
of how, as a student, he Vosseller to tell his story
[APPLAUSE] >> Troy started Sconnie Nation.
All right, thank you Vosseller: Thank you.
It's a pleasure to come here and for having me today.
fondly sitting in your shoes, whether you're an underclassman,
a upperclassman, maybe some of
are thinking about owning your you own your businesses here or
maybe the corporate world owand taking a job otherwise.to
Hopefully there's tidbits here
appreciate and learn from, for all of you to be able to
an entrepreneur yourself or thinking about it or even with a
traditional job, the concept
intrapreneurship, so being able to think entrepreneurial within
an existing corporate structure is also very important.
For today's presentation, I think we'll kind of divide the
history of Sconnie Nation, the
distinct parts. So we'll company, into three kind of
of the company, the ideation start with the founding
came up with the idea and how we phase, how myself and my partner
starting a company. Next, ultwe'll move into kind ofnto
how we grew the company and scaled it while we were still
students here at UW, and we'll
that we made during that time. talk about some partnerships
bit on where we currently are as And then we'll reflect a little
things we are looking to do in a company and some of the new
guys will get a sneak peak the very near future that you
background I'm originally from of. So to begin with, as a
just north of Milwaukee. I Brown Deer, Wisconsin, which is
fall of 2003 as a freshman. Lived in Kronshage Residence
Hall, specifically in the Turner
on my floor named Ben Fiechtner. House, and met a guy who lived
other before. We had Now, Ben and I never knew each
nothing like that, but we quickly became friends just by
virtue of living on the same
we both had this entrepreneurial floor and quickly realized that
spirit, and we wanted to bug, this entrepreneurial
So we made just an informal pact that we would constantly
brainstorm different ideas and
for a few reasons. One, tryto make a little bit ofher
money on the side, but perhaps
the process, the entrepreneurial more importantly to go through
So even if that company that we were starting wasn't ultimately
successful, we would still have a fantastic learning experience
that we could hopefully parlay
future endeavors. So Ben into future experiences and
brainstorm different ideas. At and I would constantly
there was an insert in the the time, on a monthly basis,
called Young Money, and it was Badger Herald, I think it was
college magazine. And kindit would talk abouturial
different businesses being
college students. And starwe would always thumby by
through the pages of that magazine and think of different
companies that we could potentially start.
So that kind of got the ball
wanted to do together. So, rolling in terms of what we
ranged all over the map. So teverything from an onlineas
dating service just for UW
Facebook and a lot of other online platforms that facilitate
that now, all the way to the
was to fill up gasoline ocontainers with gas off campus
and bring those back to campus
that if you had a moped you didn't have to drive off-campus.
But needless to say, we weren't too passionate about smelling
like gasoline all day or
kept constantly going back to athe drawing board until onest
night, it was the spring of our freshman year, so the spring of
2004, when we decided why don't we start a t-shirt company.
So Ben and I had both used the
as a way to refer to people from Wisconsin, like myself, ort
anything Wisconsin-esque. So really synonymous with
Cheesehead. Now, to be very clear, we did
not coin the word, we did not come up with the word, we didn't
create the word, and we never claim to have done that.
The word had been around, and people had been using it.
We weren't the first to say it. We had heard it.
That's where we got it, and that's where it became part of
our vocabulary. But we
what it stood for and our interpretation of the word,
again, similar to Cheesehead in a way of gently poking fun at
Wisconsin stereotypes like
And so we decided that we were beer, brats, and cheese.
So even though we didn't coin the word, we didn't create it,
we weren't the first to say it, we were the first to actually
create a brand around it and
message and a product line create kind of a marketing
which we later trademarked. So with that, we decided why
don't we just put Sconnie on a t-shirt.
And so Ben and I both had experience in high school
student council and clubs like
different events. So we thad familiarity workingor
with screen printers and t-shirt
touch with a screen printer by companies, and so we got in
who we still continue to the name of Underground Printing
So this is also a story of partner with until today.
partnership. So we kind of long-time business
Printing. Ben and I each threw in $300 of
our own money. So we
printed 100 shirts. So half sof them were just a rede
shirt with Sconnie written in white print across the chest.
The other half was a gray ringer
States logo and said Sconnie t-shirt and it had the United
Wisconsin filled in in red. So we started with $600, we
ordered 100 shirts, we got those
freshman year, and we stared shirts the spring of 2004 of our
dorm room. We ended jusup selling out of the our
entire batch in about a week, and I think we had a promotion
about one for $12 or two for
two. So we went $20, through them prettyt for
quickly, and at that point Ben
we're on to something. We and had this idea, we put ahink
little bit of money into it, and
in terms of selling it. So we had some very early success
really key in the entrepreneurial process is
having that early customer
often companies put in too much vtime and money on creating ao
product or being in stealth mode, you might have heard, and
ultimately when they launch there's not the uptake that they
think or customers actually want
functions, different designs different things, different
entrepreneurs behind than the founders, the
So I think getting out there it actually thought.
mode, so for us it was just wlet's just throw this idea outa
there and see if it sticks, and luckily it did stick for us.
Now, that's not to say we didn't
our customers, which is something we still do today, but
ultimately we had that very early customer validation which
I think was very important
So we sold out of our first batch, and at that point Ben and
I said I think we're
Even though the majority of our customers were people we knew,
friends of ours, friends of friends, people who lived in the
dorm, but we still made the decision to move forward with
that venture. And so
different people as we could, whether it was family members
that were entrepreneurs,
resources on campus and within university professors, and other
entrepreneurship. Frankly, the Madison community related to
touch on in the next segment, there wasn't nearly as much in
terms of classes. There were no classes like this
for undergrads in entrepreneurship at that time.
There were no support services
undergraduate entrepreneurship. In fact, the majority of the
campus initiatives related to entrepreneurship at the time
were really externally facing,
existing big business and seeing how they could leverage
technologies that come out of the university, and they really
weren't thinking about internal ideas that could come from
undergraduates and start
you will. So at that lifestyle small businesses, if
the business, we registered as point we formalized
Sconnie in the state of an Wisconsin and later at therd
federal level, and then we made a pact really to constantly
reinvest all the profits that we made back into the company.
So for every batch we sold we would just put that money right
back into the company, and that allowed us to order larger and
larger batches. It
product selection or our product allowed us to expand our
styles, sweatshirts, mix so we could offer girls
So it was really a bootstrap, organic growth process.
With that, we're also seeing
because for our initial batch of economies of scale kick in
were paying $6 a shirt at the time, if we were able to double
the order quantity, let's say we were able to order shirts at
just $5 a shirt. So our margin per shirt was
increasing, and that, again,
back into the company to retain as profits and to fuel really
our growth. For the most
shirts in person. So part, we're selling
campus. People might we're meeting people on
we'll meet them at the contact us and
They'll come to our dorm room. library, the Union.
there. Someone else We'will pick it up forirts
them. We're also
our initial website. So one thing I'll touch on is I
think college is a fantastic
for one, you have just such a unique, diverse group of people,
around you and that's diversity in background but really it's
also diversity in ideas and diversity in skills.
So, for me alone, I found my business partner, who is
complementary to me in terms of my skills, on my dorm floor.
Another guy from our dorm floor became the web designer for our
very first website. So that's something, again, that
as a result of being in this
we were able to find the people and resources that we needed.t
Another guy who lived on our
store manager of our store on State Street and continues to be
in that role. So the story
in the college experience and the relationships that were made
as a result of being
So we launched our first website a college student.
capabilities. So now that had rudimentary e-commerce
shirts online, which was people could order the
point you had to, essentially, fantastic because up until this
in Madison to pick up live ithat shirt for you.omeone
Now people from all over who may
online to, originally it have heard of the brand could go
later we shortened that wto just Sconnie.com,,
now those people could
shirts delivered to them order online and get their
So I'll pull up a picture, anywhere in the country.
the Wayback Machine which allows there's a cool website called
websites from long ago. So, younfortunately, there's notf
pictures anymore, but you can see kind of how basic the site
was, and it was really basic in terms of what people could order
on the site. Ultimately,
multiple iterations, that became later, through
now order online, etc. So now our we're selling online andple
we're finding a lot of
We're finding that people really traction with that.
our brand message is and get the brand and they know what
So, at this point, we're now what we're all about.
and I each have inventory, living in apartments, and Ben
in our apartments. And literally boxes of inventory,
campus in person, and we're also fulfilling online orders.
So first it started on a weekly basis, we let online orders
build up throughout the week, and then we'd go pull those
orders, package them, hand-write
post office, ship them out. Eventually, that became twice a
week, and then it became
it became every other day, and three times a week, and then
That really got to a point where then it became every day.
more of our time to meet the we couldn't sacrifice any
And so that forced us to think demand of the business.
could scale this business that about different ways that we
it off of our shoulders. So, took that manual labor aspect of
into third party retailers at that point, we looked
So we had this idea that we could just sell our most popular
shirts to a store on State
Now, granted, we wouldn't be Street and have them carry it.
shirt, so our margin would go down because we were selling it
wholesale, but we would be able to drop off a huge number of
shirts all at once, and then the
those. So, for us, store could take care of selling
was with the store called The Den which was an independent
novelty kind of convenience store on State Street located
where Fat Sandwich
So they occupied that spot. We Company currently is.
similar to this in terms of t-shirts and things like that.
So Ben and I literally walked in
arms. Luckily, the with a handful of shirts in our
there. He had power to buy on behalf of
the owner, buy inventory. And we literally walked out with
cash. And we said, wow, that was
pretty easy. So now we
nine, and we're thinking let's were kind of on cloud
So we took that luck, we went to the bookstore and we got in
touch with their buyer, and their buyer liked the idea and
appreciated the fact that we
look at that as kind of a bad thing but really looked at it as
a good thing saying I've seen your stuff get out in the
marketplace and I think that you
the customer base, so the target guys have a good knowledge of
So she took a shot at it. And so we left that meeting with
a purchase order for a
And so we were case of shirts, 144.
Eventually, throughout the felling pretty good.
ended up selling wholesale to hThe Den, UW Bookstore, Bucky's
Locker Room, Insignia, Name of
other areas of the state. And thethat was a very successful in
model for us because, for one,
to direct people in Madison who didn't want to order online just
to have it shipped somewhere
surrounding area. So now else in Madison or the
store. They could we see the shirt, holdo a
it, try it on,
So that was fantastic for us. It was also great in terms of
legitimacy of our brand and our business.
So up until this point we were
sophomores, meeting people on jucampus at random places, atter
random times, selling t-shirts. Now we're actually a t-shirt
that was in the store window
t-shirt at Bucky's Locker Room at the UW Bookstore or was a
formidable brands, if you will. And so people really bought into
it and saw it as not just this
college students, but a true hobby or this project of two
So, for us, that was business and a true brand.
I mentioned the online sales, those were really picking up
throughout this period, and right now we're talking like
2005-2006. And it was a very manual
process. We would have to write out
envelopes, go to the post office, and for two full-time
students, frankly, it became
having to skip class or take difficult because it meant us
studying for exams, and it also smeant we had to miss out onr
different social opportunities. So during the early part of our
company we would street vend. We had a street vending license
outside of Camp Randall for football Saturdays, but the city
has really strict rules about where you can set up and when
you have to be set up by and
and all these things, so that meant that for the most part on
Friday night before home
get things in order and ready footto prepare for the game. to
We'd have to get up really early
our friends I can guarantee you, on Saturday, way before any of
over to Camp Randall area, load the truck, take the stuff
and then sell all during the unload it, take the truck back,
After the game we have to close up, pack stuff up, and then kind
of return home. So, for us, we had make
sacrifices in terms of skipping out on social opportunities.
So whether it was going to
party with our friends before games, things that I think a lot
of college students take for
quickly say you have this gcompany and now we have peoplen
and employees that cover those
company, but when we were growing, that was all stuff that
really fell on our shoulders. And so, as an entrepreneur, I
think oftentimes you find yourself wearing many different
hats. Whether it's
salesperson, or the logistics operations person, the sales and
marketing person, the promotions
accounting person, the tax person, the legal person, the
things, and it's a matter of person, you're really all these
appropriately to budgeting your time really
So kind of at the peak of us accomplish those.
ourselves, we had moved out to a handling the online sales
Madison to store all storage unit on the east side of
But, like I mentioned, it was becoming too difficult for us.
So we went to Underground Printing, who, for the most part
since our very first batch of shirts up until today, has been
the only screen printer that
a great working relationship we've worked with, and we've had
So we approached them and said with that company.
of when to order more shirts, you gukind of that idea of terms
just-in-time production from
You guys have expertise in order an operation standpoint.
packing, pulling, and shipping fulfillment, which is the
DHL, FedEx come into their of orders, because they had UPS,
They had labeling capabilities, they had staff in place to
handle all those things because they were already doing it.
So we approached them and said
orders? Can you be our can you guys handle our online
contractor, essentially? order fulfillment
We eventually negotiated a They jumped at the idea.
essentially said that they would contract with them which
printer for Sconnie Nation, they would maintain all of our
inventory so Ben and I would
inventory, they would handle not have to worry about our
orders out on our behalf. thThey would handle exchanges,ip
returns, customer service,
That was one of the biggest turning points of the company
because now rather than worrying
things, aspects of the business, on all the kind of manual labor
what, to us, was our core Bencompetency, which was the on
branding, the marketing,
development for Sconnie. So that was a great move for us.
Granted, we gave up a little
So in order to have Underground Printing handle that, they're
not going to do it for free, we had to cut them a little bit
more of the profits to
That means we took a slightly smaller margin, but overall it
really paid off because the amount of volume that we were
able to increase through our
through. So now we're effortat a point where aidends
lot of stuff is kind of being taken off our shoulders, and
we're able to focus on
And so Ben and I, at this point, what we really want to do.
and that opportunity was saw a new business opportunity,
So Ben and I both were involved in a lot of different student
organizations on campus and off-campus, and we were
constantly being asked to buy a t-shirt for this or that, and we
were seeing the prices being
what the actual costs were charged for those and we knew
that industry. So we because we had been working in
room in the market to be, essentially, a middle man for
custom screen printing. So with that we, again,
approached Underground Printing,
Madison, and we said you guys know how well we're doing on the
retail side of things, what would you think of us being you
face or your sales agents here
custom screen printing orders, in Madison to go out and solicit
come with a design for a student and I'm talking orders for, you
a sorority, a local charity, a organization, a fraternity,
sports team, a local business, an intramural
So they liked the idea. We club, you name it.
with them where we got entered into an agreement
We already had wholesale garment wholesale printing prices.
manufacturers like Gildan, relationships with the big
American Apparel, Fruiall those players.das,
So we eventually created
commission-based sales a sales force of
students, and they each had ea different area of campuse
assigned to them. So they would go out, we didn't
have any storefront or anything at this time, they would go out,
they would solicit orders mostly
would meet with the individual through referrals, and they
collect all the order information, so product style,
the sizes, number of sizes, the color, the artwork, so whether
is was just an abstract idea for
artwork digital files. They artwowould collect all that had
information. The
employee, they'd collect all salesperson, who was our
Underground Printing. Underground Printing had an arto
department, they'd create the artwork proof.
They'd email that to the customer.
The customer would approve
Once the artwork was approved, it or make any changes.
that order directly to the Underground Printing would ship
Printing would invoice Sconnie customer, and then Underground
invoice the customer. So to Nthe customer, Undergroundld
Printing didn't really exist. Only Sconnie Nation existed.
That was the only interface that
Sconnie Nation was this whole kind of production black box,
you could say, that was creating
So in that middle man trelationship where Underground.
Printing was making the shirts, then they're invoicing Sconnie,
Sconnie was invoicing the customer, there was room to make
money. So that
profitable side of our business. actually became a very
enjoyed because it was all It's something that we really
It was about getting the right very much relationship-based.
different organizations, created decision maker within these
same time, because we had no trust around them, but at the
store, we didn't have a lot of overhead, we didn't have a
undercut all of our competition. other expenses, we were able to
So I'll pull up their website, So that was great for us.
So these guys, like I said, they've always been around and
been a partner of ours, Underground Printing.
Kind of concurrent with that
also were entering into a new tbusiness model where thus farey
they had just been kind of
people would go to them to place factory and warehouse where
because they came from college an order, they saw a need
older than Ben and myself, and and they were only a few years
student needing easier access to they saw a need for college
So what the Underground Printing be able to place a custom order.
opening a retail store in the guyheart of a college town.by
So their very first retail store
the University of Michigan, and the concept was a drop-int
location where anyone could go place an order for custom
t-shirts for their group
So you could see blank styles there, see all the colors, work
with a live person, and you didn't have to borrow a car or
you didn't have to have a car to
So up until the store for us potentially drive off-campus.
weren't a lot of options. So opening in Madison, there
own a car, borrow a car, and students would either have to
to Middleton to like then they'd have to drive out
or Madison Top Company. There was nothing really
convenient for students on
lifestyle of college students. campus that meshed with the
experimented to fulfill that So they saw a need and they
it was a great success for them. need in Ann Arbor, Michigan, and
open more stores so that they Sexpanded to Michigan State and
then Western Michigan. And
eyes set on opening at ta store in Madison.their
And so I can remember a time
down State Street as freshman whafter we had started theng
company, and we said, wow, this would be amazing if we could
someday have a store of our own on State Street.
And sure enough, that's kind of where the path started unveiling
itself for us. And
beginning of 2007. I so now we're in the
Ben was graduating in the spring had graduated in 2006.
were up in the air. I wasn't of 2007, and so a lot of things
go to law school. Ben had already accepted a job
doing sales. And so we
turning point in terms were kind of at this
The company was making money, but at the same time it wasn't
enough for both of us to be able to sustain or live off of
post-graduation. So Underground Printing
approached us again and said
Madison, we know what kind of volume you guys are doing for
Sconnie retail because we're
they're for wholesale or sales printing all your shirts whether
and furthermore, we know the coming directly to Sconnie.com,
as this middle man for custom screen printing and we would
love to be able to capture that market and grow it in Madison.
So we entered in to a new relationship with Underground
Printing where they would open a
at 521 State Street. Same storelocation it always hasdison
been. That store
of 2007. And under opened in the summer
it's really Underground Printing's store, and they
manage all the employees. They
majority of costs associated pay, for the most part, the
this was going to be an wexperiment for Underground,
Printing because up until now there other stores had only been
drop-in custom screen printing locations.
None of them had a retail component where you could go in
and buy a production
So with the Madison store they shirt off the rack.
having both things. They were going to experiment by
screen printing, which they would control and fulfill, and
they were going to have a retail
Nation inventory would component where all the Sconnie
So that store went live in the be available for sale.
And since then it's summebeen a great success.reet.
We continue to grow year after
terms of revenue, number of customers, number of orders, all
things, and it's been a fantastic relationship.
I should say that part of that
company agreeing no longer to solicit custom screen printing
orders. So Sconnie
partakes in the custom screen printing side of things.
That's completely Underground Printing's realm and territory.
But, again, that was a
that relationship there really partnership that were it not for
to have a store on our own would not have been a way for us
weren't doing enough volume to because of the fact that we
associated with it. bLikewise, for Undergroundts
Printing, they were able to maximize their revenue per
square foot by subsidizing their
retail component. So it revreally was a win/win foris
both of us because a lot of customers came in and they knew
about one or the other. So
place custom screen printing they were going there to
about the retail side of things. shirts, but they didn't know
Sconnie shirt, and they didn't Other people came just to buy a
t-shirts for my student reaorg here as well. buy
So it really worked both
relationship. Jumping wayforward to today, Ireat
mentioned I eventually went off to law school so I was staying
in Madison, and I really had an interest in taking the company
and growing it even further and really focusing on growth.
At the same time, my partner, Ben, who I had started the
company with, he graduated and
was becoming more removed from took a job in sales, and so he
differences in terms of strategy the company, and frankly our
bubble to the surface. So I mentioned we were at thiso
turning point now where as a
business go? So I papproached Ben and wanteds
to buy him out. So we were 50/50 partners up
until that point, and I wanted to buy him out.
Unfortunately, we did not have
agreement, no operating aagreement, no buyout agreement
or anything like that, so there was no framework around which to
negotiate a buyout, no process
unfortunate. So from the which, frankly, was rather
subject of buying Ben out until that actually happened that took
about a year, and, frankly, it
because I wasn't too motivated was a very long and tough year
was putting in 100% of the to grow a company that I felt I
benefit. And so I efforwasn't interested in the
continuing to do
And at the same time Ben had that necessarily.
were warranted to not want to walk away from something that he
really helped to create as well.
tied to these things. And so So there was a lot of emotion
buyout. That happened we uabout three yearson a
ago now. So since then
Nation 100% and have been able I've owned Sconnie
I wanted it to go. Ben to take it in the direction that
has a very successful career, but unfortunately one thing that
fell by the wayside was really our friendship.
So a lot of people start
partnerships are great and I these companies, and I think
oftentimes you'll have think they're important because
One might be a technical person and one might be more of a sales
and marketing person. There's other complementary
skills that fit together. But if you don't think about it
carefully or plan ahead by
go their separate ways. At having things in writing, people
just 19-year-olds, and people told us you should put something
in writing, have a partnership
agreement, but we always agreement, have an operating
comments, and we said we're good just kind of dismissed those
dorms, we're doing this thing and it's doing all right, we
don't need to worry about that, nothing will every come of it.
And to be honest, people never
have a disagreement over how disagree over or people never
nothing. They only to split a pie which is worth
over how to split something when have a disagreement
And so for us, we waited, iwaited, waited, never put.
anything in writing, and then all of the sudden we're at this
decision point where we had differences of opinion, we had
differences in terms of where our lives were going, and we had
this pie which had
And so that's what really lead significant value.
was a difficult experience to walk away from that, and I'd say
the biggest regret I have with
one of my best friends that I thestarted the business with.y,
So I think that's an important
in writing because one piece of advice I'll say is you'll never
agree more than at the beginning.
You'll only tend to disagree
due to lifestyle, that's due to molife decision, that's due to's
finances, and it's due to just differences of opinion.
And it's not to say one is right
it becomes difficult. So and one is wrong, it's just that
and definitely have don'tthings in writing.htly,
So for the last segment, to jump to where we are today, we
continue to partner with
Now the arrangement is in the form of a license.
So Sconnie Nation grants
exclusive license of our Underground Printing an
the license to all trademark, Sconnie, as well as
And then Underground Printing is free to sell them on
Sconnie.com, which they completely manage and operate,
and they're also free to sell our product in their store
on State Street. And that license is in exchange
for a royalty. So since that license exclusive,
we've pulled out of other third-party retailers.
So you can't find our shirts, with a few exceptions, anywhere
but Sconnie.com, and then the Underground Printing
Sconnie Nation store
And that, again, has been a fantastic partnership.
There are some drawbacks
At the time I originally entered in a license like that.
full-time student here at UW, inand so it made sense for me a
because I had other things on my plate.
It allowed them to really focus again on the things that they
were good at, and it allowed
competencies. But mover time there are,e
especially after I've graduated and had more time to devote to
the company and reflect on it,
handle differently. For thinstance, customer serviced
issues or store layout issues or employee management issues.
There are things that I would handle differently, but,
unfortunately, I've kind of relinquished those rights to
Underground Printing. But,
sort of licensing agreement. frankly, that's true in any
relationships and life. There's always a give and take.
People sometimes say it's your
demand certain things? brand, can't you go in and
That's drafted And to an extent I can.
But then there are other things with any sort of contract that
always come up that aren't
but the parties just agree and really defined in the contract
going on. And so there's continue on and business keeps
that if you push to hard on certain things, other things
will start to fall off. And so really it's about finding
that homeostasis point where
happy. That being both said, the licensingnd be
agreement isn't perpetual. It has defined timelines, and
so there will be future renegotiations where certain
concerns that I have, certain concerns that they have can be
re-looked at and improved in terms of that.
My role with the company today
I want. I'm free to is limbe as hands-on oratever
hands-off as I want to be. I
product development, product choose to still be involved in
well as social media, so I still design, approving new shirts, as
For instance, if you went manto Facebook.com/Sconnie,es.
that would be our Facebook page where we post all different
things, and we really try to
product, product, product, but make it be not just about
to the brand in general. about things that are relevant
by Bo Ryan, or things about the Brewers or Internet memes,
or sports articles, other things
in the world, things like abouthat. So you name it.stash
I manage those things. I also manage our Twitter page.
So just @Sconnie would be our Twitter account, which I
encourage you guys to follow. So we find a lot of traction
around social media. We began, really, as a word of
mouth company in the dorms. I think we continue to be a word
of mouth company in terms of the
products and promotions that viral nature of the different
Some more reflection on wwhat we currently do..
One thing that we noticed was that we were having really
uneven cash flows between the store and online, and we were
finding we had a lot
So when students moved back to of seasonality.
found big spikes. We found Madison at the end of summer, we
the fall and continuing through the Christmas shopping season,
but then in the first and second
would drop off a lot. quarteThat's not uncommon.evenue
That's very common in retail. First quarter is traditionally
the lowest for all of retail, but we wanted to find a way
where we could improve on that. So for us the spark came by
saying why don't we diversify.
the Wisconsin lifestyle, Since our slogan is celebrating
bucket is fair game. Why anything that fits into that
And so that's when we came out don't we try and diversify?
forget you, Brent" Brett Favre with our famous "We'll never
like crazy all parody t-shirt which went viral
It was just the perfect storm of across the country.
in terms of Brett Favre's nwaffling, his retirement ands
unretirement and his
And so it really became the gift trade and whatnot.
kept going through these that kept on giving because he
different turmoil. So we different, dragging fans through
It was a huge hit. We continued to do other Green
Bay inspired t-shirts. So whether it was for the
Super Bowl last year
or our champ belt shirt. So we had a lot of success with
that. So we were able to really smooth
our revenue year-round because
different times of the year, and now we were finding customers at
the brand, and it was we'rabsolutely fantastic. into
Another way we try to capitalize
community specific to onthat product really.a
So that's when we created a Facebook page devoted just to
"We'll never forget you, Brent" which ultimately became kind of
a sounding board and a way for
about the Favre situation, but fans to come together to talk
about the Packers in general. realSo Packers news, rumors,log
discussion, etc. And it's a page that is actually
more active than
It has more fans, more followers our Sconnie page.
So we took that and we said, than our Sconnie page.
more brand around that, and welthat's when we createdild
BrentFavre.com, which really was
if you will. So where a plaPerez Hilton is alton,
celebrity gossip blog, we're
And so we hire bloggers to write kind of a Packers gossip blog.
year, only during the football and draft posts throughout the
But we find that we get a ton seof traffic to that site..
We get a lot of cooperation with other Packers blogs.
It's a very close-knit community.
And then we advertise the shirts
subtle manner on the site. So the site is really, truly a
blog, a news blog, gossip blog, but then we also sell t-shirts.
So it's not a t-shirt site with a blog.
It's really a blog that also sells t-shirts.
So that's been really successful for us as well.
In terms of going forward, we are, some of you may have heard,
but we're working on
So here, this is launching a Sconnie beer.
So there's the image of the can, what's it's going to be.
But this is something that's going to come out.
I mentioned the whole Sconnie brand really revolved around
what I call the Sconnie tripod, which is beer, brats, and
cheese. So beer, being
of that tripod, it's one of the legs
So it's been a side project, been a long time coming.
behalf to make this happen, and kwe're excited to announce that
it's actually going to become a reality here very quickly.
We're looking to launch here
shortly. Initially, in Aprit will just be oneally
draft, on tap, only in downtown Madison, and then eventually
we'll launch with 16 ounce
So we're really cans excited about that. here.
It's aimed at the similar demographic to like a PBR,
Miller High Life, Schlitz,
Price-wise it's on par with all those beers I just mentioned.
It's a lager beer. It's lighter.
Really broad tasting in terms of who would enjoy it.
So we're really excited about that, and we think that we'll
have a lot of fun with that and,
So that's where we are. So hopefully, a lot of success.
and I becoming friends, meeting in the dorms here at UW Madison,
starting this company, growing
We never had to take outside it, very much bootstrapping it.
ourselves. Started it monwith $600 of our ownute
money, eventually expanded into wholesale, eventually started
selling a line, and then working
opening a store on State Street, with Underground Printing,
other designs to them, and now licensing our trademark and
own. So that's kind comingof the history ofof our
our company and where we've been
And so I open it up to and where we look to be headed.
Thanks, Troy. I'm going quto hand off these micsu.
to Chuck and Alexis who have
the room, delighted gracto do so, I can tell.t up
Chuck, you want to head on to the other side?
So, folks, just go ahead and
off the mics accordingly. I'm wavgoing to, I see one righthand
back there. Can you get to her, Alexis?
I've got one right here. >> Okay, here and then we'll go
back there, great. >> Go for it.
Hi, thank you for coming, first of all.
My question is regarding your business relationship, I guess
the falling out more so, and, I guess, would you recommend
avoiding those business relationships with close friends
or is having a clause or a
That's a great question. I written agreement good enough?
people when they're young our when they're just starting out
in any business, they have
ignore the elephant in the blinders on, and I think they
relationship going to work out room, which is how is this
success. So that's if we have any measure of
it when I got started. I was exactly how I treated
frankly I heard the advice but young, I was naive, and
And I think that was my mistake. I didn't heed the advice.
can take away it is to truly So if there's one thing you guys
you're starting a business with another person, treat it like a
marriage, like you are
person of every aspect because intimately involved with that
other than business because thilife factors come up.ngs
He took a job elsewhere and that
affected me personally because affected the business and that
things. So it it affreally is more thanl these
business, and I think you have to appreciate that and
understand that, and I think the
to put something in writing. So if you're an LLC it's to makes
sure to have an operating agreement that has buyout
provisions for the partners.
things if one wants to buy out So how you're going to treat
treat that. That's the other, how are you going to
50/50 relationship because in the absence of that you really
have this deadlock where no party can act on their own, and
so then that means the
And the business is the asset so business gets neglected.
in value, and then that means twhat you're fighting for ises
decreasing, decreasing, decreasing, and that's not good
for anyone. It's not
being bought out because their good for the person
diminishing in value so that share of that asset is also
It's not good for the person means they're getting less.
because that means they're that wants to do the buying out
declining rather than tasomething on the upswing.is
So it's really bad. So I
is the most important factor, and to address your question of
do you think it's okay to start a business with a friend, or
family member let's say. I
to think about carefully think it's something you got
just business. It boils becausover into personal's not
things. So I've had times where I've had
friends that were employees over
want to discipline them in a time, and there's times you'd
your friend and you're going certain way but because they're
hanging out at the bar to be going to poker night or
So I think it's best or it's later it's awkward.
business with close friends, but easiest not to engage in
a lot of value to be had with a very close partner that you cans
confide in, that you can trust, and that you do have a good
working relationship with.
decision, and I think as long as So it's very much a personal
you're aware of what could you're comfortable with it and
writing, I think happen and you have something in
I don't know if you're going to be able to answer this question
because it's kind of new issue
connection between your brand and the whole Coastie/Sconnie
dichotomy? >> That's
[LAUGHTER] So that's not new, that's old.
hanging out there, this whole Sconnie/Coastie rivalry.
To be very clear, I would say we
We didn't coin the word Coastie. didn't coin the word Sconnie.
words. In fact, we We didn't coin any of those
Coastie and never have in a single piece of marketing
literature. We've never used the world in
absolutely anything that we've
never about this divide. It evwas about Sconnie being thisas
brand, an identity really, that anybody could identify with.
So it wasn't exclusively for
Wisconsin. It was penot exclusively forin
people who went to
It was for anyone that had any school in Wisconsin.
state and appreciated that sort of connection with this
things like the Wisconsin lifestyle, so beer, brats, and
cheese. If you
you can identify with Sconnie. like those things,
the definition on our web page So I'll pull up, for instance,
inclusive. So, for which we really try to make very
out loud here. So usthe idea behind it
Sconnie Nation is simple. Anyone from Wisconsin, who
attends school in Wisconsin, or just loves the dairy state in
general can identify
Sconnie is anything of or relating to Wisconsin.
Sconnie is an identity. It can be used as a noun.
For instance, I am a Sconnie. Or an adjective, look at that
Sconnie truck. You
Wisconsin to appreciate the Sconnie movement.
It's all about embracing and
Wisconsin-esque environment we call home.y
Sconnie is tailgating, bowling, bubblers, washing cheese curds
down with a beer, having a
or eating a cream puff. If tractor-shaped mailbox,
cheering for the Pack, you you like eating a brat and
So, for us, we wanted to make it know what we're talking about.
was gently poking fun at very open and inclusive, and it
We make no bones about that. those Wisconsin stereotypes.
derogatory towards But it was never meant to be
It was never meant to create Wisconsinites.
Wisconsin and people from a dioutside of Wisconsinfrom
or people from the coast. And we've never played into
that. We just completely ignore that
that divide exists. To be honest, our customers are
a huge melting pot
They're people from all over the state..
We've shipped orders to every state in the country.
We have customers that come from all over, and we sell to
students who obviously
So we really don't play into come from all over.
been about being positive and being open to anyone that wants
to identify with Sconnie. And I wish that that divide
didn't exist because I think
the more we can embrace each it's harmful, and I think that
I think the better. other >> Hey, Troy.rences,
Thanks for being here. >> Yeah.
My name is Darian. You've already given really
valuable insight on this, but I'm going to bring us back to
the whole partnership agreement that Justin just touched on.
My question is, when you're starting out you're pretty much
at this equal playing field and how do you really decide when
you're both getting all the really good advice, ideas, and
opinions, you're really coming
partnership. When you're together and collaborating as a
something in writing, do you starting off with
this one person has more of a adleading role, but how do youis
really start with that
Sure. So that's one approach.
You could make it off balance like a 51%/49%, but then there's
ramifications for that because
that mean even though you're the partner getting 49%, does
apart, does that person jufeel relegated to the back?nt
Do they not feel like they're the leader of this company?
Because I think people want to
founders of businesses and feel empowered and especially
want to have a say and control. And even if something on paper
says I'm lesser than my partner,
that arise. I think that mreally what's mostrences
important is to have, just
So make it say if one party wants to buy out the other,
here's the procedure that we're going to follow, and you're
agreeing at time zero what
Are you going to take the book that procedure is going to be.
hard assets? Are you value of the company if you have
independent accountant to do a going to take it to an
assets? What things valuatican or cannot the and its
accountant take into account in terms of coming up with that
value? If one party objects to the
valuation, can they have
Do you average those appraisals? a second appraisal done?
Do you have a third-party Do pick a third?rd?
So there's all different
Kind of as the stop-gap, ways of doing it.
partnership, the arrangement if you're talking a 50/50
people call it a shotgun, but essentially it's where you have
this procedure in writing that
I can make an offer for a dollar amount or whatever the,
consideration for the exchange
meaning you'll take that money is and you can either accept it,
you can flip it and say I'm going to pay you that much money
for your share. So that keeps everyone honest
because that means I can't low
you, you might just ball youflip it on me.low ball
So I think that's kind of a stop-gap measure that can
prevent a lot of these things.
for Troy on this topic? Well, >> I know all the studentstion
join me in thanking you so much, Troy.
Very, very much.
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