NEW YORK (WCBS 880) — In just over four years, Bombas has grown 400 percent year-to-year, and has made $50 million in revenue, by selling creative and cozy socks.
Founder Dave Heath explained to WCBS 880’s Joe Connolly how he found a way to make socks interesting and fun – and how he is challenging the big clothing companies now in sale of socks.
Heath explained that he was working for a media startup back in 2011, but he had a family background and longstanding interest in entrepreneurship and was always looking for business ideas.
“I was combing Facebook one day – and I came across this post that somebody had put up that said socks were the number one most requested clothing item at homeless shelters. And it kind of stopped me in my tracks, you know?” he said.
The revelation didn’t immediately spark the idea to for a business plan, though Heath found it both fascinating and sad. But meanwhile, he was following businesses that were relatively new at the time such as TOMS shoes and Warby Parker – and it occurred to him that he could do with socks what those companies did with shoes and eyewear, respectively.
“I mean, I don’t think anybody ever grows up being like: ‘You know what I really want to do? I really want to start a sock company,’” he said. “But that was kind of the immediate opportunity, and you know, it kind of snowballed from there.”
He noted that the market for socks was largely a binary between cheap socks that might go for $10 for a 12-pack, and single pairs of socks worth $34 at retail.
“(I) really tried to figure out, you know, the technological differences and what separated those two categories, and the more and more I got, you know, involved in the industry, I really started to understand that the premium side of the market – which was typically focused on niche endemic categories like running and skiing and hiking and basketball – have all of these technology improvements in the premium category, but none of that was coming down to the mass-market, everyday type of sock that you and I would wear to work. So once I pulled out these technology features,” Heath said.
Heath said there was no one really playing in the $10 to $12 sock market that “took all the innovation and technology of a running sock, but made it for the everyday consumer.”
In launching his own research, Heath looked back on his own experience with uncomfortable socks as a kid.
“So the first thing I did was, so, I grew up as a child with ADD. I had hypersensitivity issues. So toe seams were like, drove me insane. I don’t know if you have kids – you like, try to put a pair of socks on a kid and they’re like, ‘But the toe seam!’” he said. “So my first thing was like, we’ve got to eliminate that. We’ve got to get rid of it. Then we created our own arch support; our comfort foot bed.”
Heath contacted factories as he examined different socks for their various qualities.
“I had no manufacturing experience whatsoever. I was truly coming at it from the consumer’s mindset. And I think that that’s what gave us the differentiating, you know, component in our product was that I didn’t come from manufacturing, so I wasn’t coming at this from being like, well, ‘The margin has to be this,’ and it’s, ‘You know, we’ve got to make it out of this, because this is more affordable,’” he said. “I really just came at it from creating the best product possible, and that’s what we ended up with?”
Now, Heath said, business is “fantastic.”
“I mean, I truly wake up every day and feel incredibly blessed for, you know, the success of it all. I’m surrounded by an incredible team. We’re about 50 people right now. We’re only four years old, but we’ve just crossed the $50 million revenue mark. We’ve donated our 6 1/2 millionth pair of socks to the homeless community,” he said.
Heath explained that a combination of approaches got Bombas to take off. He said he got “a ton of word of mouth” – noting that Connolly himself had found out about Bombas from a friend. But he added that the company’s marketing team is “fantastic” at digital marketing through social media, as well as podcasts, radio and television.
And the word of mouth aspect to growing Bombas as a business started before it even began. Heath said he launched the business on the crowdfunding platform Indiegogo and made a three-minute video to share with friends and family to see if people would resonate with the mission.
“We did just under $150,000 in our first 30 days, just through kind of word of mouth and the momentum that, you know, a crowdfunding campaign can create,” he said.
Heath said he also told everyone with whom he had an opportunity to strike up a conversation about his plan for a sock company, and got impressive traction in doing so.
“I think the initial success was driven by the fact that for the two and a half years that I had spent research and developing, I mean, anybody that had ears heard me talk about, you know, ‘I’m starting a sock company!’ I mean, people on the airplane, you know, people in a restaurant – anytime I had a free minute and a willing listener, I was telling them about this company, and I’d take their information and, you know, I’d say, ‘Can I email you?’ and I launched my campaign,” he said.
Heath now has a couple of overseas plants manufacturing Bombas socks, as well as one in Canada and one opening in the U.S. In the interest of quality, ski socks are manufactured in one factory, running socks in another, and dress socks in another still.
Bombas has also come up with new sock designs as a response to need.
“We talk to our customers, and I think one of the benefits of running a direct-to-consumer company is that you have that dialogue with your customers directly, right? And so we’re getting feedback from the customer service department, and kids purely launched off the fact that we have parents that were coming back and they were like: ‘I love your product. My kids steal our socks, but they’re too big for them. How do, you know, can you create products for our kids? And so that was how ‘kids’ started,” Heath said.
Discussion among the team at Bombas also sparked the idea to offer Merino wool socks for winter.
As to advice for others looking to start a business, Heath said the plan that worked for him was to “stick to the thing I know really, really well and that I’m really, really good at.”
“So you know, I remember that about six months into the business, I was like, ‘We’ve got to start producing underwear and T-shirts and sweat pants and sweat shirts and you know, one of my mentors who was early on at Tom’s – I was talking with him and he was an advisor for the business – and he goes, ‘We sold one style of shoe in four colors for the first three years of our business, and that resonated with me so much,” Heath said.
“And he said, ‘You’ve got to think about the brands that you really respect, right?’ Nike started with running shoes. Lululemon started with yoga pants. Under Armour started with base layers. They didn’t have all of these product categories on day one, right?” Heath continued. “And so, it’s much easier to start and build a brand when you’re known for one thing really, really well.”
To see more Small Business Spotlight segments, click here.