The Exchanges, every show

Q And now you had done a lot of the foundational work. You had gotten it on the legs of Pamela Anderson, and people were sort of becoming aware of it. But what did they do that turned this into a, an iconic global phenomenon? How did, how do you think they did that?

A After they did the acquisition, they immediately hired a guy Who had come out of a company called L.A. Gear, and he tried to turn the brand into a street cool product. He lasted less than a year, and then they brought in a young lady called Connie Rishwain, who had spent time in a lot of the New York high fashion footwear industry, and she's the one that started advertising in, you know, the, the really, really high-end women's fashion mags. That Teamed up with the fact that we'd sent boots to Oprah, and she ordered pairs for her staff and everything, and if we had announced that Oprah was, was wearing our shoes or boots, it would have killed the company when I owned the company, because I didn't have the capital to build the product to take on that demand. That, in conjunction with Connie Rishwain, who knew New York fashion, those two things coincided to make our, like, Break through the hundred million dollar barrier and the 200,000,500 million.

AI assessment note: “they brought in a young lady called Connie Rishwain, who had spent time”

Q And, and here, here's a question I have for you. I remember you said that early on, you would cringe. It was so hard for you to go into these shops and try and sell them. You were embarrassed. You were, you were nervous. Now it sounds like you were really excited to do it. So what changed?

A There was a couple of things. Um, by being out there with the customers, it was so much easier for me to, you know, get a rapport going and introduce the product by having them try the boots on. Now, that turned out to be the biggest factor in, uh, closing our first orders was having the buyer try them on. But while I was in the stores, I, I, uh, This girl walked into the shop one day, I think I was in, in Newport Beach somewhere, and she was touching the Ugg boots, and she obviously loved the look of them, the feel of them, and, and she was asking the, the staff guy there, you know, what are these like? Well, I'm not really sure, you know, well, are they, are they hot? Um, not really sure, you know, what happens if I get them dirty? And the guy was useless, right? Yeah. And I saw that interaction, and I came up with what I called the six-pair stocking plan, and if a store would open up with six pairs, I'd give a free pair to the store manager, and now, you know, I was in a different surf shop, you know, a month or two later, and a guy walked in, and he says, you know, what are these boots like, and the, and the, the sales guy says, oh, they're fantastic. I'm wearing them now. He says, aren't your feet hot? No, they breathe, you know, so, Well, what happens if you get them wet or do it? Oh, you can wash, you know. I mean, it was just like night and day, and so the guy bought a …

AI assessment note: “There was a couple of things. Um, by being out there with the customers”

Q So, okay, this is 1988, um, and so you're, you're running the business, but apparently the accounting was a mess. A total, like, the books were just a mess. Checks hadn't been cashed, um, POS hadn't, you know, been paid, and then you guys had outstanding bills that you had to pay. What did you discover?

A It was, what you said, a mess, and, ah, I had to try and reconcile everything, and it ended up about 87,000 dollars in the hole when I finally finished the accounting. Had no leads on financing for the following year. My supplier at Country Leather had just had three fabulous years Working with Neil, and he got his money on time all the time, and when I called him up and told him the news about Neil, he started to clam up, and he was, I knew he was thinking back to when I was running the company before Neil, and he, you know, I always paid him, but he never knew when or, you know, the money was coming, and so he started to get very cautious, and I said, George, don't worry. I'm going to do a business plan. I'm going to go out and refinance the company, And I'll have plenty of money to start production, right? But it didn't work out that way. It, you know, I wrote a business plan, but I got nowhere with the bankers. Friends and family were way beyond that. So, you know, I really was desperate for three or four months on a, who the hell can I approach?

AI assessment note: “ended up about 87,000 dollars in the hole when I finally finished the accounting.”

Q Um, so how did you regain your ownership? I mean, if, if his, Neil's widow owns the company, did you say, go to her and say, hey, let's figure this out. Maybe you don't want this business. Maybe I can buy it out. Like, what, what did you do?

A So what happened is that, uh, towards the end of the season, I got a call from the life insurance company, Transamerica, Because I, I made a claim when Neil died back in February, March, and I'd not heard much except they rejected, they rejected. I had a lawyer who kept pressing them, and they finally called us and said, look, we've got to get this off the books by December, 31st. Can you come to Los Angeles? And, ah, we spent a day negotiating with them, and we ended up getting 200,000 dollars as a settlement to walk away. Even though Neil didn't even have his, his, you know, physical done, so I, I was super lucky to have got that offer, and in the meantime, I'd, I'd said to Della, look, I, I think I can pay you this amount, I don't have the cash right now, but if I can keep this season together, I'll pay you, and so I signed a promissory note with her, and this 200,000 dollars was enough to pay her note out, And then by, you know, I, I owned the company 100% again. You know, who would have ever thought that that would happen again?

AI assessment note: “this 200,000 dollars was enough to pay her note out, And then by, you know, I, I owned the company 100%”

Q But yeah, you had to finance the factory. So that's also cash that you got to put out there. And meantime, most of your sales are still in What, boutiques, uh, shops, small businesses, or are, are by 1991, 92, are you starting to get into bigger retailers?

A That's the year where we started to get traction in the stores, yeah. We were huge in the surf market. Then there was the ski side. Well, snowboarding was just starting, and I picked up on that vibe very, very early, so we started advertising to the youth snowboarding thing, and that worked in the snowboarding industry. It took a long time for me to get back east because I didn't know what the kids did for sport in the winter, and I was talking to a sporting good owner from, I think it was Chicago, and he, he rolled his eyes and go, duh, they play hockey, you know, and being Australian, I had no idea of the hockey market, and when I looked it up, I went, oh my god, this is twice as big as surfing, you know, and so we started, you know, making our ads For the youth hockey players, which were all over, you know, from Chicago all the way back to Boston, and that turned out to be a huge market, and the big department stores now are seeing this happen, and so they started calling me to, you know, come and negotiate, you know, getting their product into the stores.

AI assessment note: “That's the year where we started to get traction in the stores, yeah.”

Q How do you incentivize the employee to take the time to actually fill those surveys out? I feel like people get those surveys, they ignore them.

A So, so that's the interesting part of that, right? So you did surveys suck, right? Everybody agrees that, right? And NPS specifically are, are very bad. Like you get no signal from it, from an intense standpoint to understand what to actually do with it. So one, it's the way that we ask questions. Two is the way that we score questions, right? So the way someone scores has, or answers a question, has a half-life associated with it. So that will help us understand exactly when to follow up with that person again. But to your point, We don't just take survey data and report some garbage metrics to a manager, right? What we also do is provide recommendations to both the manager and the employee to how to actually fix the things that are going wrong. So we see that an employee is burning out. We'll push a playbook to a manager to say, these are the things you should be doing. Reduce hours, whatever it is, right? Go to a four day work. We talk more about empathy, but we'll also, we have a marketplace where we've integrated into head Space and the Calm and Equinox and SoulCycle and InsightTrack and all these other things where we'll tell the company the exact service to buy for that employee based off the data that we're seeing. But on the opposite of that, we'll do the same thing with employees. We'll say, employees, this is what you're struggling with. Here's what you should do to …

AI assessment note: “What we also do is provide recommendations to both the manager and the employee”

Q And, okay, now, just the ads for a moment, what, what do they look like? Were they, like, was it just text, or were there photographs of people wearing them, or?

A No, I, I thought I was doing a brilliant job, you know, and I, um, Telling you about one of the biggest mistakes I ever made, right, which was hiring these two models, really good looking, we posed them on the beach, and I'd run those things, and, and the sales at that, you know, let's say, 8182 was about 30,000, the sales went to 35,000, like, it was like, my ads were doing nothing, and then, again, summer job, and then come back to it, and, and I used good looking models again, Sales went to, I think it was 45,000 that year, and it was like just getting nowhere, and it was probably the fourth season of me being in business. I really wanted to give up. I was working on a golf course in the summertime, right?

AI assessment note: “hiring these two models, really good looking, we posed them on the beach”