Aug 30, 2021 · 55m · how-i-built-this
Springfree Trampoline: Keith Alexander & Steve Holmes (2019)
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of How I Built This, host Guy Raz chronicles how New Zealand inventor Keith Alexander and Canadian entrepreneur Steve Holmes partnered to create Springfree Trampoline, transforming an academic safety prototype into a globally recognized direct-to-consumer brand.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Guy holds 31.3% of the talking time here. How this is scored →
Guy as informed peer 1.9 Guest teaching 3.1 Guest disagreement 0.1 Guy pushing back 0.2
speaking balance: gold is Guy, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 37:18 Steve corrects Guy's margin assumption
When Guy Raz assumes Springfree had thin margins selling at $999, Steve directly reframes the premise by clarifying they were actively losing money on every unit to validate customer demand.
Hardest push from Guy ▶ 48:44 Guy presses on post-Costco workforce expansionGuy Raz directly challenges Steve to explain the counterintuitive decision to scale up to 400 employees immediately after losing their largest retail client, Costco.
Biggest teaching moment ▶ 17:24 Keith details angled rod physics and safetyKeith Alexander educates Guy Raz on mechanical trampoline design, explaining how vertical fiberglass rods would impale jumpers on impact, necessitating a 45-degree outward deflection angle.
Guy holds their own ▶ 40:22 Guy breaks down purchase order financing mechanicsGuy Raz demonstrates financial business literacy by articulating how high-interest purchase order factoring loans function as a bridge for cash-strapped suppliers waiting on big-box retailer payouts.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Guy as informed peer | Guest teaching | Guest disagreement | Guy pushing back | Why |
|---|---|---|---|---|---|---|
| The Dual Narrative of Invention and Keith Alexander's Roots | 2 | 3 | 0 | 0 | Guy Raz sets up Keith Alexander's inventor background, inviting Keith to explain his early quirky engineering projects like walk-on-water shoes and the bald patch inspector. Keith walks him through the mechanics in an amiable, story-driven exchange. | |
| Engineering Consultancy and the Drive to Solve Problems | 2 | 2 | 0 | 1 | Raz asks about Keith's transition to consulting and his persistent backyard tinkering. Raz lightly questions the scientific validity of Keith's magnetic flying machine idea, which Keith playfully concedes was unworkable. | |
| Researching Trampoline Safety and Confronting the Danger | 1 | 3 | 0 | 0 | Keith recounts wanting a trampoline for his toddler daughter and setting out to research safety data to disprove his wife's objections, only to discover empirical studies confirmed trampolines were genuinely hazardous. | |
| The Inflatable Prototype and Its Bounce Limitations | 2 | 3 | 0 | 0 | Keith describes building his first prototype out of an inflatable rubber ring. He details the practical flaws: an $800 material cost, constant air leakage, and a complete lack of bounce height. | |
| University Student Projects and the Fiberglass Rod Breakthrough | 2 | 4 | 0 | 0 | Keith explains his breakthrough idea of using flexible composite rods like fishing rods. He educates Raz on the geometric danger of vertical rods and how angling them at 45 degrees prevents users from getting impaled. | |
| University IP Transfer and Feedback from a Local Manufacturer | 2 | 3 | 0 | 0 | Keith discusses navigating university IP assignment rules and receiving tough practical feedback from a New Zealand manufacturer requiring assembly by a solo parent on Christmas Eve. | |
| Prototypes for Customer Trials and Search for an Overseas Partner | 1 | 3 | 0 | 0 | Keith describes conducting customer trials, the university declaring the prototype not market-ready, and the commercial office eventually looking overseas to Canadian investor Steve Holmes. | |
| Steve Holmes Tests the Prototype in Toronto | 2 | 2 | 0 | 0 | Steve Holmes enters the narrative, describing sending $10,000 to ship a prototype to Toronto and witnessing immediate neighborhood kids' enthusiasm on his patio. | |
| Debut at the Las Vegas Super Show and the Costco Challenge | 2 | 3 | 0 | 0 | Steve details exhibiting at the 2003 Super Show, getting warned about enclosure patents, and discovering Costco CEO Jim Sinegal's strict blanket ban on selling trampolines. | |
| Patent Acquisition and Engineering a Soft Enclosure | 2 | 3 | 0 | 0 | Steve buys out the patent rights from the university while Keith negotiates a low-risk advisory role. The duo commits a full year to developing a flexible soft enclosure that avoids existing patents. | |
| The Flexible Net Breakthrough and Costco Canada's First Order | 2 | 4 | 1 | 1 | Keith describes the breakthrough flexible enclosure netting that created a bouncy rubber room effect. Steve corrects Guy's assumption about profit margins, explaining they lost money on the initial $999 Costco Canada trial. | |
| Manufacturing Shift to China and Global Costco Expansion | 2 | 3 | 0 | 0 | Steve explains moving steel fabrication and assembly to China while keeping core IP components in New Zealand, securing purchase order financing, and expanding across global Costco divisions. | |
| The Halifax Incident and Costco's Abrupt Cancellation | 2 | 4 | 0 | 0 | Steve recounts the crisis of May 2009 when Jim Sinegal saw a prominent store display in Halifax and canceled Costco's account, giving Steve a 14-day window to harvest outstanding purchase orders. | |
| Direct-to-Consumer Pivot and Keith as Brand Ambassador | 2 | 3 | 0 | 0 | Steve describes pivoting to a direct-to-consumer model and positioning Keith as the brand's James Dyson figure. Keith humorously recalls the terrifying experience of filming promotional studio videos in Toronto. | |
| Validating Safety Data, Business Scaling, and Company Culture | 2 | 3 | 1 | 1 | Guy presses Steve on how the company scaled to 400 staff after losing Costco. Steve explains publishing clinical safety data showing a 90% injury reduction, premium pricing, and both founders reflect on luck versus grit. |
Statements from this episode (23)
Alexander Funded His PhD by Winning Walk-On-Water Shoe Competitions
“And I built these shoes to compete in this competition and I managed to win the competition two years in a row, and then won a third one in Auckland, and that helped fund my PhD.”
Giant Conductive Ring at South Pole Could Launch Objects Into Space
“In the end, one of the best ideas would be to go to the south magnetic pole and put a big ring of conductor material around the magnetic field there and put a huge current through it, and it would actually fly into space.”
Alexander: New Zealand research showed a rise in trampoline injuries
“Even in New Zealand, there'd been some research done on the increase in injuries from trampolines. And I thought, well, they really are dangerous.”
Alexander: Traditional trampolines injure kids via perimeter bars and spring gaps
“The traditional trampoline has got a steel bar around the outside edge and springs right beside it. And then the mat that you jump on in the middle, and I can see that it's dangerous because the accident rates have gone up, and it's pretty obvious. You give th…”
Alexander: Material costs for early inflatable trampoline prototype were about $800
“Number one, the material cost for that was about 800 dollars. Back at that time. Just the material costs. So there's no manufacturing in that at all.”
Alexander: Angling flexible trampoline rods at 45 degrees prevents impalement on impact
“These things are sticking straight up, and if you're on a trampoline on the top, and you fell on it, because they're vertical, if you fell right on the edge, you can impale yourself on them. So what if we laid them over so that they're 45 degrees? Then if you …”
Alexander: New Zealand's top trampoline maker sold 400 units annually
“I looked in the yellow pages. I found the biggest trampoline manufacturer in New Zealand. He was selling 400 trampolines a year.”
Alexander: University deemed trampoline prototype not market ready, requiring up to $100K
“They had a look at it, and they said, this is not market ready. You need another 50,000, 100,000 dollars to make it market ready, and then they went away.”
Holmes: Global trampoline market was roughly $500M-$600M in 2003
“I think that we had measured that we thought that the trampoline market, that maybe it was a five to six hundred million dollar trampoline market globally.”
Costco CEO Jim Sinegal Initially Refused to Sell Trampolines Over Safety
“The CEO of Costco was a man named Jim Senegal, and Jim said, I will not sell trampolines.”
Holmes: Springfree paused sales for a year to develop soft enclosure
“So we didn't sell any products. We didn't make any products. We just spent a year building an enclosure for the spring.”
Costco Canada Placed Springfree's First Commercial Order
“We got one important order by Costco Canada.”
Costco Canada's Initial Springfree Trial Order Was 400 Units
“The first order was 400 pieces on a trial.”
Springfree Lost Money on Every Initial Unit Sold at $999
“We were losing money on every product. We had to do that to find out if we could create a market.”
Holmes: Early Springfree trampolines cost $1,450 each to manufacture in New Zealand
“They were costing about 1450 dollars. To make one.”
Holmes: Springfree kept proprietary rod manufacturing original while moving assembly to China
“Even to this day, most of the original Manufacturing components, the rods and the net material that we use, we are using the exact same manufacturing partners. They've come a long way, the whole way through the whole journey. We've never deviated from that, bu…”
Holmes: Costco placed an order for 3,265 Springfree trampolines in 2005
“Worked out to be about 3265 pieces in oh five.”
Holmes: Costco accounted for basically 90% of Springfree's Northern Hemisphere distribution
“Virtually in, in the northern hemisphere and our only. We were selling direct in places where we could, but they were basically 90% of our distribution.”
Holmes: Springfree invested $5M to build its own factory in China
“And we skipped apart guy, which is in 2008, we decided to build our own factory in China because we weren't satisfied with the quality. So I invested about five million dollars in building a Chinese factory.”
Holmes: 50% of Springfree Trampoline sales came from customer word-of-mouth
“If a spring-free customer has a spring-free trampoline, if a parent who says, well, I really don't like trampolines, they'll sell it for me to other friends and neighbors, and 50% of our sales came from our customers.”
Springfree's Redesign Eliminated 90% of Product-Related Trampoline Injuries
“Keith started writing research papers, and of measuring our statistics, and we were going, you know, we remove 90% of the product related injuries. So he's taken, his design has removed 90%”