The History of Stripes
Time and time again I find myself sharing the history of Stripes39. Moreover, I often find that people are typically more intrigued by the story than they are by our current successes. Because our history has proven to be one of our greatest assets, and also a point of interest and inspiration for others, I thought it fitting to finally put pen to paper and write out a publishable version for our website. Of course, with this comes some disclaimers.
Admittedly, I am bad at putting things from the past in chronological order so I apologize in advance if anything is out of place. And of course, please be forgiving if any specific details are a smidge off.
I do want to mention that there are many people who are no longer with us whose names were not included in my below rendition. The intent isn’t to write them out of our history, as regardless of what is shared here, the truth will always remain the truth, and these people were instrumental to our success, and for that we will be forever grateful.
Also, for those who remain with us I skewed the inclusion of names toward those who are working for Stripes39 vs. those working for one of our specific ventures. This is by no means an indication that their contribution was any less significant than that of those named.
I do hope that one day I will find the time to write something more comprehensive such that disclaimers like these are no longer necessary.
Though some early work was done in 2004, Stripes39 officially began in 2005, with seven founders: Salil Jain, Carl Ng, Quang Dinh, Sam Franada, Haley Ha, Wing Yew Lum, and James Hua. We had seed investment from my sister, Sungeeta Jain and were based out of my parent’s home in Seattle.
We were seven kids who didn’t know what we were doing, but knew we wanted to do something different – build a company where we were able to work with friends, do good, find success, and change the world. At the time, we had a friend who was operating a wildly successful ecommerce store and we wanted to follow in his footsteps. Our first project was an online Christian T-shirt brand we called JesusBranded.
Unlike your typical t-shirt company, we decided against using American Apparel blanks and going to a local screen printing shop. Instead I flew to Tirupur, India and built a relationship with a manufacturer there that enabled us to make t-shirts to our exacting specifications from the ground up. We chose how the cotton was grown, the specifications for the yarn it was turned into, and the details behind how that yarn was knitted into fabric and how that fabric was treated. From there we made our own patterns for fits, used some of the most advanced printing and embellishing processes available, and finally controlled the details of how our garments were treated and finished.
Despite our ambition, as we got going we realized that the needs of an early stage Christian T-shirt company were not great enough to support such a large team. So we did what any great, unprofitable, inexperienced startup does – we diversified.
Unfortunately, instead of our diversification being in-line with our ecommerce thesis, we somehow decided that we would go full steam ahead into the world of fashion. Specifically, we grabbed ahold of the vision of building the world’s most premium organic fair trade denim company. From that vision Sling & Stones was born.
Quang & Carl took a road trip to California as we began to immerse ourselves in the exciting new world of fashion. Just as we had been with JesusBranded, we were intentional about every detail of Sling & Stones. To set our foundation, we decided that the best fabric we could use would be 13oz organic supima Japanese selvedge denim – a unicorn fabric that for six months we were told simply did not exist.
Fortunately we persevered and we found it loomed by a small mill, a museum of sorts run by men truly passionate about denim in Japan. From there, we decided to make our own 24 carat recycled-gold plated square buttons in India, and to use 24 carat gold plated thread to embroider our logo on the pocket. We sourced our organic pima pocket bag lining from Peru – where a man operated a Fair Trade factory that enabled local farmers to earn an honest living instead of being forced to grow drugs. This factory used its excess electricity to power the village, and its earnings to do good in the community by taking on initiatives such as vaccinating and immunizing the local children.
We sought out the most advanced and environmentally friendly washing procedures in Los Angeles, and partnered with the only factory we could find that was using an ozone machine for washing. This process resulted in not only a much more natural fade, but also did not utilize any environmentally harmful chemicals that are typically used in denim production.
Our first season out the gate, the goal was to sell about $50,000 worth of denim. Somehow, we sold closer to ten times that amount by finding favor not only with local boutiques, but with a distributor who put us in the top boutiques in all of Asia & Europe. After taking some more money from Sungeeta to fund production, we were off to the races!
As we delivered the first shipment of jeans and consumers began buying them, the most unexpected thing happened…all our buttons began falling off! Though at first we thought we were doomed, we somehow found a solution that consisted of super glue and a rare sewing machine that used thread to weave in the holes from where the original button had fallen off. Though our German supplier, who we are pretty sure had a massive crush on Quang, stepped up and still made payment for our useless shipment – we were still left massively in debt.
We then did what again, every non-profitable startup that just had its world fall apart should, we diversified further, this time within fashion by launching multiple new lines.
- Seeing demand for a lower price point denim line with a story similar to Sling & stones, we started GoodSociety to be exactly that.
- We leased the domain FannyPack.com and brought back the FannyPack by working with the Bhopal Rehabilitation Center in India.
- After discovering some unique fabric sourcing opportunities, we began Academi Jeans, offering a premium product for denim connoisseurs at an even lower price point than GoodSociety.
- We created a line of t-shirts braded Deconstruction Reconstruction – where we took vintage shirts apart, put them back together with a modern fit, and printed over them – with the proceeds from the brand going to help free women from brothels through the International Justice Mission.
- We also got to the idea and sampling stage on a few other projects including Sanjuku, an iPod case line, and an unnamed attempt to bring hypercolor products back onto the market.
On the sales side, we were building relationships with showrooms, attending fashion tradeshows, and driving around the country to grow our line of business with boutiques. Meanwhile, on the production side, we had my father setup two factories for us in India. Quang lived out the factory for six months at the time, and was responsible for training workers despite never having sewn a pair in his life.
On the backend we were still preparing shipments stateside. I vividly recall Carl, Quang, & I once flying to LA and buttoning jeans for nearly 100 hours straight to meet a deadline. About 72 hours in I started hallucinating and repeatedly saw former Seattle Supersonics star Sam Perkins where there was nothing but a stack of cardboard boxes.
I should mention that at the same time all this was going on, we were still operating JesusBranded online while driving across the country selling t-shirts at festivals and also doing merchandise for bands and non-profits.
Naturally, along the way we lost some team members who decided to pursue life outside of the startup world, and added others. Notably, we were joined by a kid named Chris Kim who impressed us by showing us the pair of jeans he had sewn himself.
Even this far into the game though, the most we could afford to pay anybody was little more than a pittance.
Our sales were growing though, and with every new season came a new sales record for us. On top of just sales numbers we began to see some other fun successes:
- Urban Outfitters became a big fan of GoodSociety which allowed us to expand the line into t-shirts and shorts as well, but also to have an open door with them to sell our other lines including FannyPack and Academi.
- We started picking up a good deal of press from magazines. Notably, a sample we made in 15 minutes made it on the cover of the most respected fashion industry magazine, Sportswear International, and a pair of Good Society jeans was featured on the lead-in page of the InStyle summer denim guide.
- Bands like Paramour and artists like Feist began rocking our jeans and loving them.
The problem with how the fashion industry works is that as a manufacturer, every time you grow you end up having to invest back in everything you earned the previous, plus more into production. Not only that, but the turn on money is long, as you have to fund production many months before you can expect to be paid by stores.
We should have seen the warning signs in early 2008 as stores began fall behind schedule on paying us, but we went ahead with producing against our largest sales season ever.
At this point we had not only taken both my sisters’ entire life savings (worth mentioning that neither of them were working at this time as they had both devoted themselves to overseas missions work) and a good chunk of my parents’ savings, but we had also maxed out three lines of credit from three different banks.
Unfortunately, the economy tanked and a vast majority of stores were unable to pay us. Instead of checks, day after day we received new Chapter 11 notices – meaning our investment was as good as gone. In the end, the unpaid invoices from our final season left us nearly three quarter of a million dollars in debt.
Back to E-Commerce
I had sensed our demise in fashion coming well before it fully materialized. Furthermore, I was frustrated with the industry and how little control I felt I had over our success – it didn’t seem well matched to my strengths. Also, I was beginning to fear that I would spend the next 20 years of my life working a crappy job as a programmer just to earn back what I had lost.
Somehow, I convinced my mom and dad to lend me $100,000 in order to try my hand at ecommerce once again. Given my track record and staggering debt, it wasn’t a very wise move on their part, but I agreed to give them 50% of the business in exchange for taking one last bet on me. With that cash in the bank, along with a friend, Allen Leng, I began exploring the world of ecommerce and search engine optimization.
Soon after, we decided it was time to close up shop on denim at Stripes39. Instead of closing the doors on Stripes39, I decided to, in order to keep the team together, merge the two companies together.
Chris was writing hundreds of pages of content every week, and put in a few all-nighters to pick up HTML & CSS. Carl learned how to work PPC, manage the books, and build simple websites. Quang was finishing out denim and beginning his journey toward becoming a growth hacker, and I was fighting depression while trying to guide the strategy and lead the team.
A Sidenote About my Depression
In hindsight, as someone who had mostly experienced a healthy dose of success in all his endeavors, our experience thus far had taken their toll on me.
It took every bit of strength I had to keep moving forward, as I felt like little more than a shell of who I had once been. I was nearly 235lbs, about 70 more than I had been when we had started Stripes. I was unable to form complete and cohesive sentences. I rarely left my bed, showered, or shaved – and would literally have meetings with people coming into my bedroom without me bothering to even get up.
To add to all of this, I was frightened by the possibility that things wouldn’t work out and that I’d be spending the next 20 years of my life working some crappy programming job at Microsoft and hoping to pay my family and the bank back.
Finally I felt like I was letting a lot of people down. Not the least of which were Carl & Quang’s parents. I had convinced their sons to embark on an insane journey and here we were many years removed from college, massively in debt, and barely drawing salaries. (As a side note, I know Carl & Quang would want me to thank their parents for them here, as they are incredibly appreciative that they were even put in a position to take such a crazy risk).
I know each of us, at this point, must have had our concerns and doubts and issues we were dealing with, but thank God we somehow stuck together and forged ahead.
“It took every bit of strength I had to keep moving forward, as I felt like little more than a shell of who I had once been.”
By early 2009 we were rockin and rollin with an ecommerce portfolio – selling everything – wedding favors, easels, train horns, bunk beds, umbrellas, Halloween costumes, samurai swords, lace wigs, and more. We were doing anything and everything we needed to do to find success.
Thankfully along the way we were able to partner with and learn from the most brilliant viral marketing expert of our time who will go unnamed as he has moved on from the online marketing world and wants to be disassociated from it entirely.
By mid 2009 we were actually making some pretty decent revenue and though we didn’t particularly love the business or the margins, we decided that we were going to build a niche ecommerce empire.
More, But Different, Ecommerce Success
One fateful event changed this all – Quang was able to connect with the owner of a domain we had been trying to buy for quite some time. That domain opened up doors that eventually led to us selling our ecommerce business.
Deciding to sell was a more difficult decision than it probably should have been given our situation, but we truly believed we could have built an ecommerce empire. However when we did sell, the feeling of being able to pay down a third of our debt was amazing.
Not only were we able to pay off all of our debt, but we were also able to pay ourselves $30,000 each while also keeping enough money in the bank to give ourselves some cushion while deciding what business to build next.
Two New Paths Emerge
Part of our decision to sell was driven by the advice of Patrick Gavin, CEO of Consumer Media Network. Patrick had seen our work and was impressed by it. He believed we understood how to leverage quality content and content marketing to rank well in Google. His advice was simple – we were doing all the right things, we just had to get out of ecommerce and get into lead gen. When he found out we were planning our next move, he gave us a generous deal to do some services work for him – web site creation, content creation, and viral content marketing work.
Finally, Some Focus
Soon after we got started on the services work for him, Patrick made us an offer we could not refuse. He seeded a new business for us with a hundred thousand dollar loan along with a set of premium domains. Our task was to build up a sister company to his within education.
The business was a success and we grew the original set of websites and added more.
At this time we also began growing our team, including key players who are still with us or our portfolio companies today including Jennifer Hong and Parmeshta Jain.
All In and On Fire
From there we focused in and grew like wildfire. In just over a year we had gone from a handful of folks in my house to a few dozen in a small and ghetto one thousand square foot office to over 170 employees and contractors in a gorgeous 25,000 square foot office that previously was the legendary Microsoft Pioneer Studios.
We were victims of our own success, growing our revenues despite having only one person amongst 170 with any kind of management experience, never establishing an explicit culture or set of values to hire against, and lacking processes, systems, procedures, and policies to guide and monitor the work people were doing.
We thought that things would be okay though, as Patrick indicated his company may have interest in acquiring ours in the short term. Unfortunately, over time it became clear that sale would not happen in the timeframe we expected.