Brian Smith is the Founder of UGG Australia, a renowned footwear brand that has evolved into a billion-dollar global icon. Born in Australia with a passion for surfing, Brian’s journey in business began as a chartered accountant. He furthered his education at the UCLA Graduate School of Management and, with a modest start-up capital of $500, founded UGG Imports to introduce sheepskin footwear to America. Over 17 years, he grew the brand to $15 million in sales before selling it to Deckers Outdoor Corporation. The brand’s valuation has since surpassed the billion-dollar mark multiple times.
A celebrated innovator and entrepreneur, Brian has established himself as one of the country’s most sought-after business leaders and speakers. His expertise extends to team building, company culture, and addressing growth challenges, often incorporating a spiritual perspective on modern business practices. Brian is also the author of Birth of a Brand, where he narrates his own entrepreneurial journey with UGG, offering insights into the challenges and triumphs of building a successful brand.
In the fiercely competitive world of entrepreneurship, how does one transform a simple idea into a billion-dollar global brand?
According to Brian Smith, the Founder of the iconic UGG Australia brand, the journey from conception to global recognition is a testament to perseverance, innovative marketing, and understanding your audience. Brian’s story, as shared in this engaging conversation, is riddled with challenges and breakthroughs. From his initial struggles to introduce sheepskin boots in the US market to the pivotal moments that skyrocketed UGG’s popularity, Brian provides invaluable insights into the entrepreneurial process. He emphasizes the crucial role of authenticity in marketing, the importance of being in tune with consumer needs, and how seizing the right opportunities can define a brand’s success.
In this episode of America Open for Business, host Cameron Heffernan welcomes Brian Smith, the visionary behind UGG Australia. They delve into the origins of the UGG brand, Brian’s innovative approach to overcoming marketing hurdles, and the pivotal role of influential endorsements in brand growth. This conversation is an inspiring blueprint for entrepreneurs aiming to leave a lasting mark in the business world.
Cameron: 0:02
Hello, I’m Cameron Heffernan and I’m host of America Open for Business, where I talk with high growth entrepreneurs and leaders who have found success in one of the world’s most important markets. Today’s episode, which is a really special one, and I’m very excited to talk with our guest the episode is brought to you by your B2B marketing, a truly global marketing agency. You know many mid-market B2B companies. They face challenges in clearly defining their value proposition and then articulating it to their customers. So we help founders and leaders understand what makes their products and services invaluable to customers and we help them put that front and center. This empowers our clients to focus on company growth and new market entry, not marketing initiatives, and realize the best and highest use of their time. So you can discover how we can drive your expansion by visiting your B2B marketing dot co. That’s dot co, not dot com. And speaking of someone who experienced fantastic expansion with his brand, we have today on the show Brian Smith. Before I introduce Brian, I want to give a big thank you to Inc 5000 and EO, the entrepreneurs organization, where I first saw Brian deliver a fabulous keynote address and a very inspirational session that we’ll look into that a little more today. And Brian Smith is the founder of Ugg Australia brand, which has matured into a billion dollar with a B global icon. Brian’s become one of the most sought after speakers and business leaders in the country. He’s the author of Birth of a Brand. The story of his own personal journey to building this billion dollar footwear brand and his inspirational talks and media appearances on his breakthrough business strategies are widely attended by business people of all ages from all around the world. Brian has been designated by Footwear News as one of the most influential people in footwear in the past century. His website is bryansmithspeakercom. Brian Smith welcome to America. Open for business. Cameron, thank you so much for having me. Great, so glad to have you on today. I’m going to jump right in. So I looked recently and although you exited from the initiative and Ugg in 95, currently Ugg brand is doing almost $2 billion of annual sales, sold in 130 countries in the world. So I just want to note, you know, take us back to some of those early days. This is a story of origin that came from surfing. How did we get to this culmination?
Brian Smith: 2:35
Well, I was an accountant in Australia. I’d worked and studied at night and after 10 years I finally graduated and I quit the same day because I really didn’t like accounting that much. And I did a little lot of soul searching on what I wanted to do and I thought you know, all the big brands are coming out of California. So I decided to go to California and look for the next big thing and bring it back to Australia and that was how I was going to spend my life. So I arrived in Santa Monica, rented a little house and rented a Dodge Van and I had my surfboard, because my dream thing to do was to go surf Malibu, and since I was a young kid I’d been reading surfer magazines and that was one of my sort of benefits of getting to California. And I was looking for months for some business that I could find that was new, that was inspiring and I could take it back to Australia, and it just wasn’t happening. I was there two months, three months, four months and it finally hit me when I went for a surf at Malibu in October, november of the year, and the water was getting cold and the wind was getting really chilly, and after I was finished surfing, I was with my buddy and I was pulling on my sheepskin boots that I’d brought from Australia and I just had this massive dose of goose bumps and I thought, oh my God, there are no sheepskin boots in America, and one in two Australians had some form of sheepskin footwear. So I looked at my buddy, doug, and said, oh man, we’ve got to go into business together. We are going to be instant millionaires. That’s a very common thought for every entrepreneur when they have their big aha moment. And so we did a bit of research and we found a manufacturer in Western Australia and we ordered six pairs of samples from Country Leather. And when they arrived, doug went on the road and went to probably 150 sherry tailors and came back after a month and said Brian, they tell me we’re crazy trying to sell sheepskin in California and it sounds logical, but it’s really not true, because Australia’s climate is identical to California. And so we had to figure. As every entrepreneur does, when you hit a wall, you have to figure out a way around or over it. And I thought well, how come all my friends up at Malibu think this is the best idea in the world? And it struck me that so many of them had been to Australia on their surf trips and they’d bought four or five pairs of boots back for their buddies. So within the surfing community, doug was quite well known, and so that’s how we decided okay, let’s go and sell to the surf shops. And that’s what was the beginning of everybody thinking this is the surf brand. It never really was, but it was associated that because we found the lowest hanging fruit, which was surf shops, because of the awareness, and so we went to all the surf shops up and down the coast and they all thought, oh my God, fantastic. I remember the very first store I walked into. The owner goes oh, I’ve got a pair, they’re the best and you’re going to do really, really well. And so after a couple of weeks of visiting all the surf shops on the coast and in San Fernando Valley, doug and I realized we’ve got a million dollar business here, and so we raised some money very easily. We didn’t even do a business plan, but my roommate had some contacts who were looking for investments, so we raised 20 grand, which in today’s money is about $80,000, and we sent 15 down to Australia and ordered 500 pairs, and they arrived in early December and we got a lot of customs and we loaded up our vans and went back on the road to all these surf shops and I remember that very first surf shop that told me we were going to make a fortune. Their response was oh well done, brian, but we couldn’t sell them in our store. We just sell surf boards and trunks and flip flops and turns out. After I visited all the surf shops in California, total sales for that three or four week selling period, total sales was 28 pairs. Just happened to be $1,000, it was a fluke and that was horribly disappointing, but it highlighted the fact that just because something’s of success in one country doesn’t mean it’s automatically going to be a success elsewhere. And that began a long period of me trying to figure out where I could sell the boots. And as soon as we realized how little sales were, doug went and got another job and I got stuck with all this inventory that I had to get rid of. And so it took me nearly three years and I was selling in swap meets and street fairs and the best thing I had going was the back of the van. At Malibu I had the van loaded up with product and I would go surfing at 6.30 in the morning, I’d get a coffee around 8 and just to be open for business and in today’s terms that would be called a pop-up shop and it was weird because people would see a person wearing them over in Hollywood and they’d go where’d you get those boots? There’s a guy up in the parking lot at Malibu. And so the sales went to $6,000 for the rest of that season and the next year. I thought, okay, I’m going to advertise because I got to figure out how to get more traction, and so I’ve got a couple of models and pose them on the beach at Wind Sea in La Jolla and perfect hair and clothes and the boots the main focus of the ad and the sales went to $10,000. And so the next year I got better looking models and a better photographer and the sales went to like $15,000. And the third year I actually decided I was going to give up because I had a summer job working on a golf course and I had plenty of time to think through that nobody gets. Americans don’t understand sheepskin like Australians do, and this was a vital bit of knowledge that took nearly four years to discover. Australians like a born with sheepskin knowledge. You cannot rip a sheepskin that strong. When they’re wet, you can wear them. When they’re wet, they will still insulate, so you can keep your feet warm, you can wash them. But Americans thought, oh, it’s hot, it’s prickly, you can’t wear it in the outside because we have snow and we have mud and slush and you’ll ruin them. And so there was this incredible disconnect between Australians and Americans and how that broke through. That, when I did this, was probably the biggest and most important marketing decision or sales advertising decision that I ever made, and it was so cheap. I was in a surf shop one day and this lady customer was in there and she was looking at all the boots on the shelf and she said to the manager, hey, what are these like? He says, oh, I don’t know. She said, well, they’re sort of expensive because, yeah, they’re really expensive. And she put them down and walked out and I thought what a waste. And so I thought if that manager had worn them and knew what they were like, it’d be different. So I Created this plan. It was called a six pair stocking plan. If you put, if you buy six pairs, I’ll give a free pair for the store manager. Yeah, and then a little while later I was in a store and and another person was looking at the birds say, hey, what are these like? And the guys is, oh man, they’re the best things in the world. I’m wearing them now. I’ve never been so comfortable. These things are so practical. And she bought a pair and walked out right and and that I Mean it cost me one pair of boots for every store. And it started opening up stores like crazy, because the word and I realized the word of mouth is so powerful. That’s just that’s why people were coming to me at the parking lot in Malibu and and it took four years for me to figure that out you know I’d spent a lot of money on advertising and doing all the you know what you would call the normal promotional things. If there’s a, if there’s a missing part in the link, which was what do they feel like then never going to get to the market, and so Then I started advertising to the young kids. I Hired a couple of young prosurface through some contacts that I had, and Instead of posing them on the beach with the, with the boots being the main focus, I just did a couple of shots where I photographed these kids walk and turn from the beach and, and I picked two iconic spots trestles in San Onofre and Blacks Beach in La Jolla and and every little kid who read Surfer magazine Would know these walks right. Yeah and and I, and I figured that if they were walking with Mike Parsons or Ted Robinson, who are the two young pros that I thought it would be a big draw. Well, what happened? When I did that season? The sales went to 200,000 plus. Mm-hmm, right, yeah, and the with. The weird thing is in the first ads the boots were like half of the ad page, but the two shots are years walking to him from the beach. You could hardly even see the Ugg boots. Right, it was all about I figured out that every little kid would just die to be walking down to Blacks Beach with Mike Parsons or Down trestles with Ted Robinson. You know, and, and it started this, this absolute wealth Raise, I guess, is a good word for it. If you’re at Malibu High, you had to have a pair of Ugg boots or you were not cool, right and so with that Christmas, all the, all the kids are going mom, I want a pair of Uggs for Christmas. You know, all the cool kids at school have got them, and it was that Simple, simple marketing trick that made this available to the, to the entire surfing community. So anywhere in the country, who, anyone who read Surfer magazine would, would want a pair of these Ugg boots and that became so successful that I duplicated that in snowboarding and skiing Couple years later I was wrecking my brain says no, what are what are people in Minnesota do? What do they do in New York? They don’t surf and a lot of snowboarding. And I found out through, you know, asking some retailers. You know, what do the kids do for sport? They go well, hockey. And when I researched I go, oh my god, that’s bigger than surfing. Yeah, and, and I had no, being Australian, I mean we never Play a thought, ice or grass. Exactly, you know, and so when I started doing, you know, the youth hockey magazines it, that’s when it became sort of nationally well known in as youth, a youth sort of Product, and and that drove the peer pressure, you know, when they were in a school or go to college, then you know Especially the Californians who went back east, like you know the college. Yeah, they’re wearing their Ugg boots in the snow and people are going what the hell are those, you know? Oh, these are hugs. They’re the best. And so it took four or five years To get that national awareness, and but even even though it was a national, it was still in a very, very tiny niche. Right right but that that was really the beginning of the brand.
Cameron: 15:39
There are several places in your story where the things that you did you were ahead of your time, right. So like that to me is basically influencer marketing where you have right and we can look at those To today when they’re talking exactly influencer marketing.
Brian Smith: 15:54
Yeah, yep, yep, and you were ahead of that, and that was 45 years ago.
Cameron: 15:58
Right. So that’s just cool to me about marketing and and brands and how we position them. Those decisions are fundamental. You know, 200 years ago and two years ago, a lot of the things still apply you were working with and also you chose deliberately the people who are authentic to your brand. There’s a in the book you talk about. Sometimes you chose models who were too attractive. You wouldn’t ever surf. That didn’t work either.
Brian Smith: 16:21
Yeah, well, the how I found that out. I was, you know, coming into this season and really wanted to get out of the business because it was, you know, it was so hard. And I, before I advertised that third year, I had a beer with one of my surf shop retailers and I was explaining this problem with marketing and he got shut up, brian, and he calls all these little kids out from the back store you know who stored their surfboards in the shop, you know? And he says what do you guys think are hugs? And Every one of them just went oh, those hugs, man, they’re so fake. Have you seen those ads? Those models can’t surf and when I saw it through their eyes I was like so embarrassed at how bad these ads were. Right, it was what, like every everybody else was using models and stuff, but it was an unauthentic and and when I use Mike and Ted, you know, mike and Ted, the authenticity was what reached the kids, mm-hmm, and that was what set this thing on fire.
Cameron: 17:28
And is also that you were in touch with your consumer audience right? That’s called out a data point. Today it’s more sophisticated market research. You know hundreds of dollars.
Brian Smith: 17:37
I had. I had no. You know, there were no texts about it, there was no webcast and you know, seminars. There was nothing. I was flying by the seat of my pants, so I inadvertently Sort of fell into the influencer marketing phase.
Cameron: 17:55
Uh-huh, but also that wouldn’t have come about if you weren’t listening to your customers and opening open to their feedback. That’s right. I want to touch on the something you brought up there about you know Australia. This is a common let’s even say commoditized product. You couldn’t get a trademark because it’s. You can’t trademark something that’s so basically known and there’s so many different commodity Options for. But in this country you’re introducing it brand new for the first time from scratch, and a lot of the clients that I work with and and the people listen to our show are overseas based and they’re thinking about these kind of Challenges right now. Right, so you brought in your case, you brought a new idea or concept to the US market for the first time. Some of our clients are established in other countries. Maybe they’re coming here for the first time and trying to grow for the first time. What kind of? What best practices or tips would you share with them?
Brian Smith: 18:44
Firstly, do a full search on trademarks to make sure you don’t come in and and Contradicts somebody else’s trademark. That was very big for me, even though the law in Australia with trademarks is the first guy in with ten dollars and fill out the form, you own the trademark. But in America and the rest of the world is if you can establish first use and Continual use, you have trademark rights. So it’s really important that you do the research Because if you come in and you start your business and you get it going and you’re doing a half a million dollars and you find you get a letter in the mail from some law firm saying hey, you’re, you’re, you know, contradicting this trademark or this patent, then that’s devastating. So do the research beforehand and have a legal firm do a search on whether it’s trademark or patent. Get that out of the way first, because it’ll save you a lot of money if you get caught out afterwards. The other thing is to Really start to test the product with the market right in a small way. You know, I I started with. You know that. Twenty thousand dollars a capital If I had had a million dollars to start, I Would have blown 900,000 on Advertising. The the wrong, the wrong type of avatar like my advertising was absolutely hurting me. I didn’t have no idea, but it was turning people away from you know my target market. You got to get the research done, get a bunch of users and and have them validate that yeah, this, I love this product, even though it’s, you know, from Germany or it’s from Venezuela, I Love this. This is so practical. So so get a Really good test program going with potential users before you start any big marketing launch. Or, you know, swamp the product with. You know, get buying an inventory. You know a warehouse full of inventory before you got sales. You know that that hurt me for many years.
Cameron: 20:55
Yeah, one of the big breakthroughs that I recall from the book was when you talked about the for the first time, getting anyone really but the sales people at these different shops to actually take off their socks and Step into the, to the, to the, to the footwear. That was a huge thing for you. How, how did that become so important? Well, the.
Brian Smith: 21:16
There was another instance in Las Vegas. We’re a big ski trade show, right, and we’ve been there for three or four days and hardly had any sales. And On the fourth day this woman came by and I knew that she owned like 15 ski shops in New England. She’s a huge retailer and she was looking at the boots and I could hear her talking to the salesperson, my salesperson. She said no, this will never work. We have mud and we have slush. They’ll never work in New England. And I just couldn’t stand it anymore. So I walked over to her and I said excuse me, man, would you mind taking off your socks, shoes and socks and try one of these? Oh no, I don’t need to do that. I can see how soft that. And I said no, just please do me a favor. And so she’s wearing Reeboks and socks, right. So she took them off and she put the Ugg boot on and she just went oh my God, these are so comfortable. I could sell these in the after ski department.
Cameron: 22:22
Right.
Brian Smith: 22:23
Just like that. We got an order of like 30 pairs, for I think it was 10 stores, like 300 pairs. That was more than we sold the whole previous season, right, yeah, and one retailer. And then from then, the penny dropped, you know. And then I instructed my staff from then on, never, ever try and sell a pair of these boots until the person you’re speaking to has tried one on. And so I had a small cadre of sales reps that were all over the country and every time they went out on the road now, instead of getting shut out, shut out, shut out they started with trying the boots on, and they nearly always got an order. Small to large Didn’t matter, as soon as the buyer had firsthand knowledge of how good they were.
Cameron: 23:12
That changed the entire face of the company from then on, and you even managed to pull this trick off with one of the best known conservative radio talk show hosts in the country. Tell us a little about that experience. I thought it was a hoot in the book. You mean Rush Limbaugh?
Brian Smith: 23:27
That’s right. Rush Limbaugh, that was a bit of a. It wasn’t a disaster, but it was. You know, I had a you know a lot of board of directors and investors, you know, and they were in love with Rush Limbaugh. Right, they were going to do anything to get the product on Rush Limbaugh, but I’d been carefully developing this really cool underground surfer, snowboarder, you know, skater type image and it had tremendous power and none of them looked up to Rush Limbaugh, right, yeah, and so what happened is that, you know, I got out, voted and we spent nearly a million dollars of advertising in one season with Rush Limbaugh and our sales didn’t increase. I mean, they increased, but not any more than I would have increased them without Rush Limbaugh. Right, and what it did? It took all my cool, cool customers and transformed them into Rush. You know followers who would walk into a store and say, hey, I need to buy a pair of Ugg boots. Rush Limbaugh told me I got a pair of, you know, and they had no charisma. They were just, like, you know, sheep following Rush.
Cameron: 24:40
Right.
Brian Smith: 24:41
So it was an interesting exercise. We didn’t lose money, but we didn’t really make any more than had. I continued on. You know grassroots marketing efforts, did you?
Cameron: 24:54
feel you were being inauthentic to the brand and you were kind of compromising to play, I did.
Brian Smith: 24:59
Yeah, I did. My partners didn’t. They didn’t really understand the marketing part of it.
Cameron: 25:04
Yeah, one of my favorite parts of the book and I let me actually show. Some of the listeners watch this on YouTube, so as I’m talking, I’m going to bring it up. But some of the sorry. One of the concepts that I love in the audio version of the book is that you set up as eight chapters. I don’t know if the print book is like that, but the audible version. Can you see the your cover?
Brian Smith: 25:35
No, I’ve got a menu of all of your, your. Let’s see, it’s not right, here we go.
Cameron: 25:41
There we go, there you go, it’s just my smiling mug in the book and it’s broken up into 18 chapters deliberately to reflect Brian’s concept in the book you can’t give birth to adults. And every chapter is infancy, kindergarten, toddler years and all that, tell us a little bit about how that.
Brian Smith: 26:03
Well, I just having you know I didn’t write that book until after I’d sold the company. And I look back and I, for you, know 20 years that I had the business. You know, if something interesting came up on a piece of paper, I’d shove it in a folder and go, that’d be good in a book one day, right.
Cameron: 26:22
Right right.
Brian Smith: 26:23
You know, fast forward 20 years. I sold the company and I thought, you know now’s be a good time to write the book. And I had a file folder, you know, ring binder, with about you know three or four inches worth of papers, and I went through and I started, you know, organizing it and I started writing the book. And in 79, which is when I founded it, and when I got to about 82, 83, I’m thinking God, was that 82 or was that 83? And I had all my records of what the sales were through all these years, right, yeah, and so I just had this brilliant piece of luck. I thought, you know, I had all these diaries, you know, the daily planners. And when I, you know, I found this little bag in my garage that I’d moved from house to house and it was all corroded, shut. So I cut it open and there was all my daily planner since the day I arrived. So I was able to go through each planner for each year and pull out oh, that’d be good in a book, that’d be good in the book, that’d be good in the book. So it was. It turned out to be a chronological progression and it made me realize that the theme is you know, I’d had young children and I thought, you know, this is identical to raising children. It’s not identical to raising a baby, because everything starts in a business with conception. Someone has an idea right and then they put it into action. That’s the birth. So me buying six pairs of samples was like the birth of our, and then every business just goes into this horrible infancy and it lies there and it lies there and it lies there and it has potential it has to keep feeding it you know, change the diapers and every now and again you get a giggle out of it, but it just that. Infancy is the worst and that’s when most entrepreneurs give up because they think it’s not working. Yeah, but an infant can’t get it up and go to college, right, right. So eventually it’ll start toddling, and that’s a great phase because, you know, the magazines are starting to write articles about you and all your true believer friends are out telling all their friends and that that infancy goes into toddling. And then, after a year or two, it’ll hit the youth phase, which to me is the best you know you got. You know sales and marketing is working, shipping and receiving is working, accounting is working, the sales force is working and everything clicks together. You can run a 20 or 30 million dollar business in that youth phase. But if it’s a really great product or service, it’s going to hit the teenage years. And do you recall? You know, as a teenager, on Saturday night you want to be every party in town. Yeah Well, it’s the same in business. You want to be in every major trade show and you want to be every mass retailer. And it’s suicide to go that fast. You’re running out of capital and and you can just lose your business. But if you’re lucky then you know the controls get put in and it becomes a mature business. But every single if you look at the stock exchange page on the Wall Street Journal, every single company there started with like a thousand dollars, like I did in sale Right.
Cameron: 29:35
Those teenage years is where the distractions come in. You know you have the opportunity to enter a new segment. You can get into hockey skates, you can get into the Asian market. Is that really where you want to be for the long term growth of your business?
Brian Smith: 29:48
Yeah, it’s super dangerous and it requires a lot of control to manage that. Yeah, and again, like, like, I didn’t have any peer groups to talk to, Like. Now there’s EO and YPO and you know all these great organizations you can join and you can tell them your problems and they’ll give you a solution. Well, I was flying by the seat of my pants for nearly 20 years, wow.
Cameron: 30:11
And not only that. In addition to that, the other complication for you must have been you weren’t, you were introducing an entire new category. So, you know, in positioning and marketing we look at where do we, where’s our product service, at least as a starting point, we’re there and let’s evolve and grow it. You were defining a new category that is so difficult, like you mentioned in the book Jack Burton with a snowboard at different events. People laughed at that at the beginning. Right, absolutely.
Brian Smith: 30:35
Yeah.
Cameron: 30:35
That must have been one of the hardest things to overcome.
Brian Smith: 30:38
It really was and it was. It was frustrating because every time I’d get depressed and think, oh, this is never going to work, I want to give up. I would just think, well, how come half of Australia owns a pair of sheepskin boots, right? So I knew it wasn’t the product, it had to be me, and that sort of was a kick in the butt to get up and figure out. Okay, well, if it’s that good, over there American buyers and consumers are identical to Australians, so it just took a long time for the word of mouth to get out there, and that’s really highlights the fact that you can’t give birth to adults.
Cameron: 31:19
One thing I wrote down, a quote from your book disasters don’t make you go backward, they are just new level challenges to face. So how did you come so perseverant and willing just to stay at it Was part of it naivete.
Brian Smith: 31:32
Well, yeah, I was very naive, but the thing is, every entrepreneur has to have some level of ignorance going in, Because if you knew what was ahead, then there is no way you would do it right. So you have to be sort of ignorant and naive is a good word and it took a long time to you know just to realize what is the key selling points that it always came back to trying them on, and once I did that, it then became very, very easy.
Cameron: 32:11
When I think of clients that I work with, that you know all across the world and have you know, services, professional services how much easier that is to get started versus what you did. Not only is it a physical product with a, you know, very complicated supply chain, but you had to have multiple versions of each size, men and women. You can’t just have you know two size six and two size 12 of boots. You had to cover the whole range. That must have been a constant headache.
Brian Smith: 32:38
It was a horrible and that’s one of the reasons I wanted to give up at one point is that the cost of inventory. Just to satisfy, you know, some girl who comes in, I want a pair of seven tall sand, right, we had to have from five through 12, and not only tall but short ones. And sand color is one color. What about natural? And you know that the inventory requirement was the biggest hurdle and the fact that you know it’s still the same today. You know, 40 years later, if you have a product-based business, you are gunned. The more successful you are, the harder the business is going to be to keep going because of the requirement for inventory. And most businesses have to pay 50% deposit, you know, to get the order started. Then they have to pay the balance before they ship it to you. So you’re out all that money for three to six months, whatever this production cycle is, and then you sell it the whole sale and you’ve got to wait 30 to 60 days to get the money in. It was a nightmare and, if I look back, my biggest regret, even though I was an accountant, like you know a CPA. I had no idea about finance right and there were no business plan templates online. There were no. Everything I did was on 13 column sheet, you know, written sheets. All my orders were just, you know, done that way and the ability to finance product was like an alien thought to me right, yeah. Yeah, you’ve been helping, mentoring a lot of people and there are alternatives to this. If you have a evergreen product where the finance you know, your people will actually bankroll your inventory and take payment when you sell. That’s the. That’s the. If that had been around 40 years ago, I’d probably still own the company you know, Are there successes like that you can share for our listeners?
Cameron: 34:49
that maybe overseas and thinking about man access, to capital Access was what’s getting in my way.
Brian Smith: 34:54
Yeah, well, there’s two things. One, as an entrepreneur, and you’re doing well where you are. Let’s say it was in a different country and you wanted to get into the US. Well, it’s a huge market here. So you have to segment it and figure out exactly which niche you’re going after. To get started, Like I started, in surf and now it’s. It’s a worldwide casual comfort footwear brand. Yeah, and it doesn’t even resemble that. I mean, surfing is not even a part of their marketing anymore. Right, but to get there, you have to find the niche, right, yeah, so my biggest advice is who is going to be the easy fruit, low hanging fruit? You know who’s going to be the easiest market to get into? And if you can figure that out and start small, that’s the way to do it. Yeah, but, like I said, if you have millions of dollars, you still got to go small and build a momentum, because you just can’t that infant just can’t get up and be, you know, a youth. You’ve got to. You’ve got to build to that.
Cameron: 36:02
Zeroing into that product market fit is just essential. So these days when you’re working with, you know speaking in front of audiences or maybe doing consulting. What are some of the things you’re seeing and sharing with those kinds of audiences and clients today?
Brian Smith: 36:15
Well, I guess the overall theme would be perseverance, right, because you’re going to hit. You know you don’t start at the bottom and then go straight up to the top, right, you hit a wall, you’ve got to get over it, then you’ll go along for a while. You hit another wall, you’ve got to get over that, and then you hit it, and that’s so. It’s a series of plateaus that you’ve got to get on top of and it, if you can overcome something that a competitor doesn’t overcome, you get market share right. So perseverance is by far the most important, and there’s a fabulous quote. In fact, my favorite quote in the whole book is that the quickest way for a tadpole to become a frog is to live every day happily as a tadpole. Right, because you know, as long as you’re plodding along, getting better and better and better each time, eventually you’ll look back and go oh, my God, I’m a frog. You know. That’s one of my favorites, and the other because of my books full of philosophy and spirituality as well, because, yeah, building a business is great, but it’s a really boring book. So I’ve intertwined my whole life into the book to where how I was feeling, all the you know the things I was going through, and the other greatest quote that I have in the book is that nearly always, your most disappointing disappointments will become your greatest blessing. And when I am speaking on stage, I always ask the question raise your hand if in the last 12 months something happened in your business or your personal life that at the time was a huge disaster, and now you look back and think, thank God that happened. And every time 80 to 90% of the audience put their hand up Fascinating. So it’s a matter of figuring out what is. What is the problem? What’s the sticking point? and figuring out a way around it, and you know it’s got so easy for me. Now. If something goes wrong, I just go ah damn, that’s good, right. And then I think okay, what’s good about it? And if you instantly switch into positive mode, like most people go oh my God, the world’s so unfair. Why did this happen to me? This isn’t, this is so. You know, if you can switch and go, what am I going to do about it? You can take a three month pity party and turn it into a one day transition that will improve what you’re doing.
Cameron: 38:52
Yeah, that came through loud and clear when I was reading your book. That concept, that shift mindset of how you look at things. There’s an author, dan Sullivan has a book called the Gap and the Gain, and the book explores that. You know, everything could be now coming up as tax season, april 15th, and I could say, oh man, I owe so much money to the government. I’m really bummed about that. You flip it around and say, would I rather be not making any money, have no profit? Great point, that’s all how you look at things. Your book that really came through to me and the number of obstacles and challenges it overcame. I couldn’t encourage anybody who’s out there looking for the next keynote speaker or someone to come and address a sales team or sales conference to reach out to Brian. His talk is not just the experiences, the stories he’s lived through, but his sense of perseverance, his relatability is just fantastic.
Brian Smith: 39:42
Thanks a lot, Cameron. That sums it up beautifully.
Cameron: 39:47
I like to close with a little rapid fire round of things that I wrote for you Best surf spot in the world.
Brian Smith: 39:56
Oh, rincon, in near Santa Barbara Nusa, which is in northern Queensland of Australia, there’s one that was famously, in the endless summer, called God. That just headed in the capes in France. There’s a zillion good spots. But the thing with surfing if the wind comes up or the swells are not there, it’s really quite crappy. All the elements have to be working the right swell, the right tide, the right temperature, and when it’s on, it’s just absolutely magic, one of the most weather-dependent sports we’ve got.
Cameron: 40:38
Maybe golf is another one, but have you seen these videos of these nuts that go get on a snowmobile and go out to Iceland or Greenland and they’re surfing with big, thick wetsuits in Northern Ireland yeah, literally having to crack through the ice? That is crazy to me. All right, launching a consumer brand in the brick and mortar mall-centric era of the world, or direct to consumer.
Brian Smith: 41:02
Well, with the internet now, direct the consumer is definitely the way to get started because you get instant cash the minute you sell, you’ve got cash right and that’s a huge boon for Every business. But if it’s super successful and it’s a product-based business, you’re gonna have all the same issues that if you’re selling it to bricks and mortar. Yeah, but however, if you have an online product like software or business services, stuff like that, you can grow very, very, very quickly. But doesn’t matter if like. I want to tell you one last story, but yeah this, you know Frog and tadpole story. When I started out, there was another company in Oregon and they had these nylon running shoes they were importing from Japan called blue ribbon shoes, and they they were to me like a new brand and I was always watching them, competitively right, and they eventually, after about four or five years of just horrible marketing, trying to get into the running magazines, trying to get into the athletic department in high schools and colleges, and they were getting hardly any traction and then Completely outside of their control, and this is right about the time they changed their name to Nike, right, the sport of jogging took off Absolutely outside of Nike’s control right and. Everybody starts looking for running magazines and they see, here’s this blue ribbon. Blue ribbon, oh, nike, nike. And they’ve been dinking along for three or four years and and so everybody starts buying Nike’s because of this jogging Phenomenon and they, you know, quickly went into the millions and the hundreds of millions and the billions. But here’s the weird thing I Read shoe dog, which is the you know the story of Nike by Phil Knight, the founder, and he listed his sales, just like I list the sales in all of those 18 chapters. So you see the progression. Yeah, would you believe that the first five years sales of hugs was bigger than the first five years of Nike?
Cameron: 43:19
I love it. So even a company like that Went through the birth and the infancy Wow, wow, and I would submit that you couldn’t have put this all together, kept all the information, the data written, the book, if you weren’t an accountant, if you weren’t an accountant, you know, long ago, tossed all that, so it’s the least sexy and cool part of your story. But it’s not possible. It all comes together for for successful entrepreneurs, you know it turned out to be a roadmap for entrepreneurs.
Brian Smith: 43:45
You know, and I, when I did the audio, I published that in 2014, and in 2022 I did the audio version. And I’m coming into that thinking, oh great, you know, it’s eight years old, I’m gonna update it, I’m gonna fix all you, I’m gonna bring new information. And when I read it again, I didn’t change a single word. Wow, that that book is such a roadmap for entrepreneurs. It’s got a beginning, horrible middle, a Brilliant breakthrough and then the end right. Well, that’s, that’s the path every entrepreneur will will will travel if they don’t give up.
Cameron: 44:23
It was kind of like to me, one of those I don’t know if you watch Netflix series these days or these these shows that they seem to prolong them Artificially just to keep the series going like these ups and downs that seem too unrealistic. Your book, your story, was a little bit like that.
Brian Smith: 44:36
It’s just how much can one person take of inventory issues, people stealing the ideas, intellectual property theft and Everybody tells me it’s a page turner and I think the reason is they’re not sure I’m gonna be around. Next chapter.
Cameron: 44:52
Well, I hope you’ll be around for a long time. I think one of the one of the really cool part of the book I loved is the concept of an inventor versus an innovator. Right, so your, your product was new. It was an inventive product. No one had it before in this country. But that’s also opens up. You know, the the buried entry is relatively low, so innovators, copycats, can come along, and that’s probably one difference between the brick and mortar versus today’s era. It’s really simple to start up a brand new company online.
Brian Smith: 45:17
Yeah, yeah, and, and, to that point, the mantra that I developed within our company, because it was you can’t patent a shoe and you can’t patent a color. You know, and so our mantra was let’s get out front first and then run faster, right, so you can imagine asset a trade show. We’re seeing all these people from Japan, korea, china Taking photographs of our product, and I knew that they were gonna develop our product and have it on the. You know the the retail selling For the following season. So during that season we come up with new styles, new colors, new whatever. Yeah, and so the next year when we’re at the trade show, they all had out last year’s product, but we had a brand new line, yeah, and so that was how we kept ahead by by getting out front and running faster. You should never be afraid of your competitors. You should learn from them and just trying one step ahead.
Cameron: 46:22
Competition proves there’s a need or interest in the market. I sometimes my clients oh boy, a competitor? Hey, that’s shows that you should be there and there’s an opportunity here, yeah, southern California or Western Australia.
Brian Smith: 46:35
There’s so well where I live in Encinitas in San Diego, I could be in Perth, I I could be in, I could be in any suburb in Perth. In fact, this little niche here in Southern Cal is is so Australian. It’s very Surfy. You know everyone’s gone to bed by nine o’clock at night. You know it’s. It’s a really funny little town, but it is. You know there’s more eucalyptus trees here in Southern California than I remember in Australia.
Cameron: 47:03
You know, test to the gum trees up in Northern California myself. No, they got there but they ain’t going anywhere now.
Brian Smith: 47:08
Yeah.
Cameron: 47:09
Chartered accountancy or global brand entrepreneur.
Brian Smith: 47:13
Oh Brand on.
Cameron: 47:14
Well, anything but accountancy Okay which shows that people, where there’s all your story of origin, doesn’t define you right. You can all.
Brian Smith: 47:23
And I’m never Ungrateful that I have the knowledge of accounting. That’s helped me tremendously. But to, to, to live a lifestyle of you know, I think I was a latent entrepreneur even during those accounting periods, because you know I’d be in a sandwich shop in line and I’d be mentally calculating how many sandwiches do they have to make to break even. You know what the rent is and the salaries and shit. So I was always thinking in in terms of that and it was just lucky that I broke out of it.
Cameron: 47:56
Yeah, funniest customer objection oh.
Brian Smith: 48:06
Wow, I don’t know about funny, because it was heartbreaking, but it was just. These are so ugly, okay, okay, and that was. It still is very common. You know, oh, those things are so ugly, but you know, the minute you put your foot in it, that disappears.
Cameron: 48:26
That’s a nice retort. Overcoming. That is I, maybe they are, and, by the way, hug is part of the name word ugly. But just take your sock off and try it on, then you’ll reconsider how you got it out. Yeah, all right, so we’ll close with this. What is your favorite Pink Floyd song?
Brian Smith: 48:42
Well time. Okay, it’s from dark side of the moon, and I’m going to tell you why it’s so important to me. I, in that period, after I quit being in a count and I was trying to figure out what I was going to do with my life, I happened to hear this music on the radio. Car radio is driving home and I didn’t go home. I went straight to the record store and I bought dark side of the moon. And that’s when I heard the words tired of lying in the sunshine, staying home to watch the rain, you are young and life is long and there is time to kill today. And I thought, shit, he’s talking about me, right. And then one day you find 10 years have got behind you, no one told you when to run, you missed the starting gun, and those words galvanize me. I was in America six weeks later because I realized shit, I’ve been. I’ve been 10 years running on the spot in a business that I hate and I’m going to go find something that I can bring back to Australia. And so those words from Pink Floyd or, you know, mark Knopf, just galvanized me, and I’m sure there’s a zillion other songs that that that other people, other entrepreneurs have been moved by as well.
Cameron: 50:02
Right.
Brian Smith: 50:03
Great question.
Cameron: 50:05
I’ll close with one more, but before that I want to give a chance for people to visit your website, ryan Smith speaker dot com, available for speaking gigs keynotes. I thought he was one of the best speakers I’d seen on the on the EOYPO circuit as well, as you do speak in front of companies and do some consulting for companies, want to tell us a little bit more about that?
Brian Smith: 50:25
Yeah, my favorite one was booking that I got for zoom and that was before the pandemic and I spoke up in San Francisco to about 300 of their sales staff and and after the event. It was a great, you know, everybody really enjoyed it and the founders took me out for dinner afterwards and the whole conversation was around. Oh, my God, you know, we’re just not making any progress. We’re doing 200, 250 million and no matter what we do, we can’t seem to grow. And you know all of the initiatives. I think we’ve got every business in America already on zoom and there’s nowhere else to go. Well, fast forward another year and COVID hit Wow. And guess what? Zoom went into the hundreds of millions and the billions. Like that, they were the fastest ones, because that you can’t give birth to adults. Yeah, they, they had taken it all the way up to where they thought they’d saturated. And then another societal shift happened, completely outside of their control. Right, they couldn’t control COVID, but they were able to reap the benefit and they went into the billions so fast, wow. So, that that theme is very universal.
Cameron: 51:49
So be right opportunities there, be ready when it when it yeah yeah, yeah. Last question is how much of your success, your success, do you attribute to your expertise, dedication and hard work, and how much, how much of it is just due to good, old fashioned luck?
Brian Smith: 52:06
I tell you what luck. Luck is great and I am a guy sort of I think more in terms of karma. Right, okay, and if you’re out there doing the work and trying to be better every day and just working it, then when an opportunity comes up that would be called luck and you are ready to take it. But other people who are trying to do the same thing, but but we’re lazy, they’re not going to pick up on that. That luck, my, I think the biggest bit of luck that we had was for years I’d been sending boots to like 20 people in London every year that there was this girl, trudy Styler, who was Sting’s wife. And you know we want to be part of that cool scene. So I was filling orders for all her friends every Christmas. It was a pain in the butt because it was in the middle of the shipping season and everything I’d have customs didn’t work. Yeah, and anyway, because of that, for a couple of years just servicing her friends, she called me one day and said hey, Brian, I need a huge favor. I’ve just been to a seminar. It’s changed my world. I need the most perfect pair of tall, sand size whatever Ugg boots. And here’s where to send me have a pan. I go, Yep, and she goes Oprah, care of Oprah Winfrey, Chicago. Right, and call that luck or call that karma. It was the event that became a societal shift because it took a bit of a while to set this up. But when she finally announced hey, you know she’s had Uggs for best picks for Christmas and on Oprah’s favorite things, you know we had 20, 25 minutes of nothing but Ugg when Oprah was at her absolute peak of popularity and that took the business from the millions. You know they were doing about 15, 20 million. That took it into the hundreds of millions and the billions.
Cameron: 54:06
So, yeah, luck, luck is always there, but you have to be prepared to take it Unbelievable Well we’ve been talking today with Brian Smith, the author of Birth of a Brand and founder of the worldwide Ugg brand. Brian’s website again is Brian Smith speakercom, where he’s available for keynote sessions, inspirational talks with companies and events, trade associations, et cetera, and Brian thanks so much for joining us on America Open for Business.
Brian Smith: 54:35
Hey Cameron, it’s been a pleasure. Thank you very much.
Cameron: 54:38
Thank you.
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