I have to move on the ball. It is how the two I can run flat out for a half mile before my hands start shaking. Then I'll see the first question. Now what is the second question?
I'm going to have to see the first question. I'm going to have an epic organism. I'm going to have an epic organism. I'm going to have an epic organism.
I'm going to have an epic organism. Me too. Paris. So.
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Hello boys and girls. This is Tim Ferriss recording in Montreal, Quebec. The Tim Ferriss Show, each and every episode is focused on deconstructing world class performers from all different fields. And this episode features Blake Mycoski.
You can say hi to Blake on the socials, Twitter and so on at Blake Mycoski. And why COSKIE. We've known each other for quite a few years. Blake is the founder and chief shoe giver of Toms.
And that makes him the person behind the one for one business model, which helps person need with every product that is purchased. But there are many, many stats and some very impressive numbers related to his bio and his business. And we will get to that shortly. It's initial intro, very, very short.
In this episode, we cover a lot. We talk about early entrepreneurial ventures. Let's try that again in English. Early.
I think that's French. English. All right. Anyway, early entrepreneurial ventures, the power of journaling, how the stool analogy changed Blake's life lessons from Ben Franklin and much, much more.
This episode comes from my new television show, Fearless, 10 episodes. It's a full season where I interview world class performers on stage in front of a studio audience about how they've overcome doubt, conquered fear and made their hardest decisions. You can watch the entire first episode of this TV show, Fearless, with illusionist David Blaine, where he actually performs magic on stage with guests from the audience as well. You watch it for free at att.net forward slash fearless.
That's att.net forward slash fearless to watch all of the episodes. And a lot of them are physical or involved demos on stage. Please visit directtvnow.com, only one T in that not direct space TV, but direct TV one where directtvnow.com or you can go to Tim.blog forward slash fearless. And we've recorded three hours of material for this particular session with Blake.
All of it was awesome. We used one hour for TV. So this podcast episode is not a duplicate. It is almost entirely brand new content that did not appear on television.
So I hope you enjoy this chat as much as I did with Blake. Bye, Casi. Welcome to Fearless. I'm your host Tim Paris.
And on this stage, we'll be deconstructing world class performers of all different types to uncover the specific tactics and strategies they've used to overcome doubt, tackle their hardest decisions and ultimately succeed on their own terms. Watch your hands. How many of you guys own a few pairs of shoes? That is everybody in the room.
How many of you own around 10 pairs of shoes? More than half. How many of you do not own a single pair of shoes? All right.
So that's zero. My guest tonight has built a company that's given away more than 60 million pairs of shoes to those who need the most. During a trip to South America, you recognize a unique opportunity to blend business and philanthropy. Since it's founding, Tom's has given away millions of shoes, helped restore eyesight, and provided safe drinking water to those who need a cross the globe.
So ladies and gentlemen, please welcome to the stage the founder of Tom's Blake, Mike Cossie. How did your mom and dad differ in terms of parenting styles? That's a good question. I think my dad was more serious and more kind of intellectual and the things that he taught us.
I think it was much more hands on caring. They both were very caring. But I think that my mom's was just so overattentive to our... I was a first child.
I think the first child gets it no matter what family it is because the parents are so afraid of messing up. I know I am. I'm a two-year-old. But my dad was always the moral...
He was the true North in the family and he was a disciplinarian when that needed to happen. He was the intellectual, I would say. What was interesting is when my mom became this best-selling author and every publishing company in the world is flying to Arlington, Texas to try to court her. Then my dad is realizing, wow, this is totally changing our family's whole financial life.
The coolest thing I learned from my dad was he cut down on his practice 50% started supporting her, traveling with her, going to the talk shows, infomercials. It was a total role reversal. I think that really taught me a lot about relationships because it was such a beautiful thing to see. I wasn't really understanding all of what I was seeing at that age.
But now, he was there putting him through medical school. My parents literally used to sell their blood to go pay their rent. They were so poor during medical school. All these stories being in New Orleans at Tulane and going in.
My mom always says my dad could get more money for his blood because it was more rare than hers and that used to piss her off. All these things, but she was working as a waitress and working here and there and everything to put him through medical school. It was all about his career for the longest time. For the moment, my mom created something that had some energy.
Instead of him being threatened by that, which I think a lot of men would have been, he said this is amazing. It's your turn now. I think that's my parents married for 47 years. Yeah.
So, I think seeing that was another part of that whole experience that really had a big impression on me, not only what my mom created, but to support my dad played in it. Was the cookie stand your first business experience? I think so. That seems like such a cliche, doesn't it?
There you go. That was the early day cookies. I was a little older when I was selling to myself, but I was trained at a young age. It is almost like one of those, I mean, I feel like there's some great cliches and entrepreneurship and they're cliches because they're, you know, they're cliches for a reason.
Like having your first business be the lemonade stand or the cookie stand. You hear that. I had a little old rage in that. My mom made these amazing cookies and I recognized my grandmother lived on a golf course.
And so on Saturdays and Sundays, you have, you know, hundreds of people who mostly know my grandmother who was a real character coming through the golf course. And so if I sat there right on the eighth hole, I think she was on the green and I was, you know, dressed cute and all that, like I could sell anything, right? And the great thing about this business model was I convinced my mom to make all the cookies but to not charge me for making them. So I had zero cost of goods sold, 100% profit margins.
Your mom is a terrible cookie flyer. Yeah. It was a fantastic business while it lasted. I did that a couple summers.
So I build up some clientele and they like the cookies so much that they wouldn't just buy them for that eating occasion. They would buy them and put them in the freezer to have for weeks. So I had a pretty good thing going. I think that was about when I was like nine or 10.
But yeah, it was, that was the first, I think, on to be real venture. The second one was, and what very few people know, because it's not, I don't think it's really been that public. But my dad, when I was 18, freshman year in college, at this point, I had never had a real job as my dad says. Like, I mean, I was training to be a professional tennis player.
So every single day after school, I trained from 330 till literally bedtime. And I was incredibly obsessed with tennis. And my parents totally supported that. But then when I went to college, I was playing college tennis.
And I remember my dad after the season was over and he said, you know, this summer, I really think you need a job. I had a younger brother and sister. My brother and sister had, like, they were eight years younger and four years younger. They had jobs like the dry cleaners or the clothing store, the mall or that, all these were places and they were much younger than me.
And my dad's like, you know, you've got a college scholarship. You're doing your thing. But this summer, like, you need to have a job. And I was like, okay.
And I wasn't really excited about that. But I said fine. And it wasn't because I didn't like to work. I worked really hard.
I worked hard on something I cared about and I was tennis. And so I talked to people and said, how can you make the most amount of money when you're 18 years old in a part-time job? Because I still need to practice tennis. And the answer I got time and time again was to get a job at a restaurant that had high price points but that had a pretty quick turnover.
So not fine dining, but like a, you know, but a more expensive restaurant than kind of fast service. And so there was this asking for it. But I was asking, like, anyone in college that I thought was over me that had made some money or that had any form of, you know, like, that's work experience. And in friends of mine who were older in me in school had done that and some of them were even putting themselves through school that way.
And so there's this restaurant called Pop-a-Dose in Texas. I don't know if you've been there. It's a couple of people. So it's like seafood.
Anyways, it's pretty expensive, but the tables turn fast. And so I went and even I had no experience. And some people, this is their career. I mean, this is an important time job.
It's that good of a restaurant job. But luckily, the hiring manager was a huge tennis fan. And so we talked about tennis and she played in college at a rival school that I was playing at. And I was like, I can do this job.
Like, I mean, I really had this seller on me doing it. So I got the jobs. I came home and I was like to my dad. I was like, I got a job.
I got a job. I got a job I wanted to make, like, a lot of money this summer. And so the next part of, if you're working at a restaurant, is memorizing the menu. I hate memorizing things.
I mean, I just like that. It's like the worst for me. Like, studying and cramming for tennis is not my thing. And so after like two or three days of this, I was like, I just, this is miserable.
Like, I'm not going to memorize this menu. And I found out that you don't even get paid the first two weeks because it's training. And my summer is only like nine weeks long. So I'm like, that's like 15% of my paying.
So this is, this is sounding less and less appealing every day. So this is where the moment came in. I think this was truly my first entrepreneurial kind of synopsis went off my brain. In our house, next to our house, there was a tennis court.
And I clearly had, you know, learned to become a great tennis player. And I knew that there were a lot of kids in our neighborhood that could use tennis lessons. And maybe even some other adults that wanted tennis lessons. And we had a tennis court we could use anytime.
And I knew how much my parents paid for tennis lessons from me growing up. And there's a huge investment for me. And so I just said, before I go into work this next week, this weekend, I made these flyers. And I put SMU, college tennis player, you know, training for the next eight weeks, kids, adults, classes, the whole thing, the same way as you'd see it like a country club.
And I made 5,000 flyers and it really took me like two days every single mailbox in the entire neighborhood. And then at that point I had my own phone line and I changed my voicemail to like Blake's tennis camp or something. And I started getting calls. And like within a week, I had like every hour of the day booked.
And instead of making, like I was charging, I was, I think it popped a dose with tips and stuff I had to average where I was going to be making like maybe $14 or $15 an hour, which would have been really good back then. But teaching tennis, because I had each kid paying like $15 an hour to have five kids at time, I was making like 80 bucks an hour. And so I had this set up. My dad came home.
He thought I was supposed to be a worker, a papa dose. And he sees me teaching like a whole group of kids. And my mom delivering cookies and lemonade to their parents. And he goes, what's going on here?
And I said, you know, this is a still job. And I'm making four times the money than I was. So that was the moment where I really felt like I kind of started my entrepreneurial journey. Yeah.
Did your dad want you to get a job to earn money or was it because you wanted to have the experience of like reporting to someone else? I mean, clearly it was a ladder, but I trumped him with earning. Well, he couldn't argue with 18. You'll make $80 an hour.
I mean, it was crazy. Every time I want to airplane, the first thing I do if it's not getting a cup of coffee is start journaling. I have a massive safe in my office. It has hundreds and hundreds of journals.
We're actually making a documentary film about the whole Tom's experience and a big part of the film is going back and grabbing random journals and reading these entries. And you're like, I can't believe I was saying this or thinking this because you tend early time I tended to be more popular. Even though I confess all my fears, I tended to kind of use the journal as a way of positively setting the tone for the next day, the next week, the next month, and it's something that I love doing. And it's something I'm really glad I did because I think it helps me understand my life, which I think is good because understanding your past is how you can really think be more proactive for your future.
Totally. I have, so this is a shared habit. So I have probably about eight bookshelves worth of journals. I've kept them all since around the same age, 15, 16, but it started with weightlifting.
I wanted to track my progress and to be able to understand what worked and so on. But it's turned into what I've heard described. I think her name is Julia Cameron. She wrote a book called The Artist's Way.
She described journaling the first type that you confessional as spiritual with. Spiritual windshield wipers. Meaning you get that down, especially in the morning. And the way I look at it, sort of trapping my monkey mind and my anxieties on the page is that I get on with the day.
And the morning journaling habit was actually introduced to me by, and by the way, guys, the morning journaling specifically isn't something I started until about, I want to say three years ago, at the recommendation, because I think it's a lot of people I had been journaling for a long time and then I stopped for a while. And I would only use it for goals. But I didn't do that other point, which I was so critical. And I was like, ah, that's like the rah-rah positive thinking, like I don't even get all the secret, like I don't want to get all that.
So I then ran into any Brian Copleman, who's a screenwriter, along with his writing partner, the illusionist, a solitary man, Ocean's 13, billions of co-creators of that show, which is the current huge hit. He does it every morning. And he said, you have to start morning journaling. So since I was coming from him, I started and it was immediate, the difference in not just my performance, but also my well-being.
Well, I think, and I haven't heard the spiritual windshield wiper, which I like that term, because that's what it kind of does for me. And anything that is controlling my thoughts, like stress-related or I feel like I have too many things in my mind or my to-do list or everything, once I get on the page, then I can just like singularly focus on the most important things of the day. And I know you've spoken about like, do the two most important things right away in your day. And by journaling, A, help me organize what are those really things?
Because when you're writing about it, whatever's being the most attention typically is the thing you don't want to have to do with it, you need to do. But it really does, I think, help you clean your day. And at the end of the day, too, I think it also can serve as a way to allow yourself to relax and get ready for bed and get over with the day if you've had some stuff on your mind. So it's interesting by writing it, you would think it would make it even more something you'd be thinking about.
But I find once I've written it and I let it go and I close the book, it's like the problems are in the book and they're no longer with me anymore. And if it's a positive thing, then I think it is potentially reinforcing that. I never forget this. There's so much thing going back to these little moments in your life that can really change trajectory.
And oftentimes it can be someone that you meet or you hear listen to or book you read. So there was a guy named Bob Dedman and Bob Dedman has passed now, but he was a self-made billionaire and he gave more money to SMU in University of Texas, I think than anyone ever. He grew up in a trailer park and he started off as a lawyer and then ultimately where he made his real fortune was he recognized that golf clubs, country clubs were becoming more and more popular in the 70s and the 80s. But it was very expensive to maintain the golf course and the restaurant and everything and you made money by selling the real estate around it.
So what he started doing is creating clubs with multiple courses, but one crew that could serve as multiple courses. So now you'll need one greenskeeper for three clubs and three times the amount of real estate sales, one kitchen, all these things. And it became the sync of club court, when he passed away, he was the largest owner of golf courses in tennis courts in the world. And he's this amazing guy and he lives in Dallas, Texas and he loved tennis.
So he'd come out and watch our tennis matches. And he was kind of a centric billionaire guy who'd watch our tennis matches and for whatever reason, I forget what it was, I think it was raining, we couldn't practice that day. And our coach said, you know what, you guys have seen Mr. Dedman many times watching the matches since rain today, we can't practice.
We're going to watch a video of a commencement speech that he gave for the MBA program at University of Texas a couple of weeks ago. And just so you can have some more frame of reference of how wise this guy is. And he, he, the speech was basically about having a life path and thinking of your life as a stool. And every stool has three or four legs.
And what are they going to be the legs of your life? What are your path? I mean, one is your talents. One is your interest.
One is, you know, all these different things. I can't remember exactly what it was. But I remember leaving that day and I just started myself thinking, you know, I don't think my stool is going to be a professional tennis player. And I actually think my life is about other things.
And I started recognizing these kind of pallets, you know, talents was definitely self discipline and all these different things. And so I remember watching that video and having peace at the idea of not continuing down this tennis path. Another great Ben Franklin story that I've read that actually had a huge impact on early days of Tom's. I was reading the biography, one of the ones many written.
And so when he had the Farmers' Almanac, right? And that was, they allowed to recognize that that is, that's how he made his first fortune was, was through the Almanac. And most of the things we know of Ben Franklin for actually happened after he retired age 40. So he sold the Farmers' Almanac, had money at the time, retired.
And then all this, inventions and then came out of the Triocities afterwards. But what my favorite stories was is there was this person that would advertise the Farmers' Almanac. Ben Franklin did not agree with his ethics and his morals and his ideals, but he needed to take advertising money to keep his Almanac going. And so what he decided to do was that night, he instead of sleeping in his bed and his home, he slept in his office on the floor with only a piece of bread to eat.
And he woke up the next morning and was just as happy as he was the day before. And that's when he said he would never take advertising dollars from someone he didn't believe with. And so that was a huge thing with me with earlier the Tom's. It's like, we will stay 100% focused on the mission whether we make it or not, because we're going to be happier doing it the way we feel that is the right thing to do than cutting corners to make extra money.
And when I read that, that was a huge thing. So I was just going to say, not only that, but that you can live with the worst case scenario. That's what he proved. So we're going to keep kind of peeling back the onion here because I mentioned Stowe's this earlier.
Part of the reason I suspect Ben Franklin did that is he was a huge Seneca fan. Yes. And Seneca, specifically, he has a collection of letters called the Moral Letters to Lucilius. Don't worry, this is going to be long.
And there's a letter I think it's 13 called on feasting, on festivals and fasting. That's it. And I know the name because I've read it so many times. And part of it is set aside a few days, I'm making up the time period every month where you will go with the cheapest address, the scantiest affair, sort of the roughest of bed, asking yourself, all the while, is this the condition I so feared?
Yes. And I have a close buddy, Kevin Kelly, who's a maid. And Kevin Kelly is the founding editor of Wired Magazine and has done a million just incredible things. And what he would say to himself to kind of bring it into contemporary times because he'd spent a lot of time backpacking as a kid.
And he was like, I was always thrilled, even as just like a dirt bag, college student, backpacker to have sleeping bag and oatmeal. He's like, it's like, it's a lot of stuff sleeping bag, no, no. I'm fine. I don't have to sell out.
So this isn't selling out. This is dropping out. And so, but I started this thing and it was kind of working and I had employees and I had this responsibility. And that felt much more real than going to class like talking about Descartes or whoever, whatever philosopher I was talking about at the time.
And so I remember calling my dad and I was really nervous because my dad, as we talked about before, is this really accomplished doctor? I mean, how many years of school, college, medical school, residency? I mean, he had made a life of education. And I was going to tell him after 18 months that I was going to drop out of college.
And I was also the oldest grandchild of all my other cousins and stuff too. So I was like the one everyone was looking at, you know? And his response to that was like the most amazing into this day. I still kind of baffled to understand how his response was this way.
But he basically said, you've taken on this thing. You have a responsibility now to a lot of people. And it seems like you're having a lot of fun. And so I think it's a great idea.
And I was just like, this is a joke. I've been working like a month on the preparation for this call. I was too scared to do it in person. Like I did it.
And even though my parents would live an hour away, like I did this as a phone call just because at any point in time I needed to just hang up and get out of it. And he was totally supportive. And I think it's a big testament to my dad and his belief of giving people the chance to fail and to learn. But it was an amazing point because his confidence or his ability for me to kind of be curious and try something.
And also him stressing how I had really, now that I had employees, I had taken on more responsibility than just doing something for myself. It was bigger than just me. And that has really stayed with me through all the different businesses. And I think that's why we invested so much in our employees at Tom's.
And they're full well-being, not just their financial well-being. And also the point was my dad and I made them too was I was going to be on my own financially. So if I dropped out, I was being supported by my parents when I was in college. A lot of kids, or not every kid has that fortune, but many of the kids in my school were like, OK, if you're dropping out, your business needs to support you.
You need to be able to support yourself. And so that was a real difficult reality at first too, which created a lot of fear and a lot of like, oh my gosh, now I have to make this work because my parents aren't supporting me anymore. And that also is a great motivation. I think that was a great move on his part.
Oh, yeah, I've got to keep your feet to the fire. Yeah. No parental safety net. One of the things, a question I get all the time when I speak at universities now is they talk about people choosing to become entrepreneurs.
And I think, in my opinion, a lot of people will disagree with me, that you cannot choose to be an entrepreneur, like you choose to be a lawyer or a doctor or a teacher. Like, I mean, if you go into it saying, OK, I'm going to study entrepreneurship and my career path is becoming an entrepreneur. That is, I think a recipe sometimes for a disaster. Because then what happens if you've chosen that path and you don't have anything that's bothering you, you don't have any issues you need to scratch, then all of a sudden you're looking at the world like, how can I make money?
How can I create something that people want? But it's never really your want. It's never really your dying passion, your thing that you're willing to sacrifice everything to solve in the world. And so you end up creating a business that is to make money and to do all these things that they taught you in entrepreneurial textbooks.
But it doesn't ever have that same intensity of the person that just is trying to solve a problem and then ends up creating a business. Yeah, and it's actually point out too, this is really super important. This is a step spoken to classes as well about entrepreneurship. And there are cases of people, say, dropping out of college and becoming huge success, right?
Yeah. But there are also a lot to do not. Of course. So it's not necessarily causation.
There's a lot of people who say go to a Harvard MBA program and they do go in to become an entrepreneur and there are successful examples. But my position has always been exactly what you said. If I'm at least scratching my own itch, I know for a fact there is one customer. Yes.
I know for a fact there's one customer. It's like with the fore I work with you in my first book, I went in to find the book. I covered it and I couldn't find it. I was like, all right, there's Jack Welter over here.
I had to build a fortune company, not interested. Then there's like money's not important, give away everything. I'm like, I'm not sure I'm in that camp either. Yeah.
Where's the thing in the middle? And so it just ended up being a collection of those experiments for myself. My country, by the way. I mean, since you brought up, I want to make sure at least I was able to say this on the show is like, I read for our work week right when I started Tops.
And there's so many things that I took from that book that allowed Toms to have this incredible growth. We never had investors which is unheard of when you go from zero to 500 million in seven years. And the reason we were able to build so rapidly is we outsourced so many things. And I never would have understood how you could operate so lean had I not read that book.
So I think that I'd send too many pictures of the over the years of me going like this. And then number four, because it's usually like when I'm sailing or playing polo or doing something fun. People that we've outsourced a lot of this work to, they're working really hard right now. But I'm not and things are contained to do great.
And I know that wasn't the only purpose of the book, but it really made an impact on me and a lot of our early staff already because when you're building a company, when you try to do everything yourself, it's really hard to grow as fast as you can. But the minute you kind of let go of some of that control and you're outsourcing as many different things as you can, yeah, your margin might not be the same initially, but you can prove the model, you can get the top line sales and you can always come back and improve the margin later by bringing that stuff in house. But anyways, thank you. Well, thank you.
That makes my day. One of the things, I think one of the negatives of starting as an entrepreneur at age 18 is you're so focused on your work that you have very little time for other stuff in your life. And I was seeing that my friends were having these much more fun social lives than me because I was working all the time. So the way that I was kind of made a deal with myself was, and that was my way of still having some form of balance in my life.
And I think the word balance and that we can have a whole two-hour conversation about the concept of balance because I think that people look at it some different ways. But for me, the only way I could even have a thought of balance was this 11 months, just like going crazy in a working as entrepreneur and then that month off in this place. So my sister and I have been in all these amazing countries on the amazing race. And one of the countries we kind of quickly went through was Brazil and Argentina.
And I always liked really immersing myself in whatever that country was known for. So I got a guidebook. And as you know very well, the first thing that came up and that Argentina is known for is the tango. And so I had not read your book yet.
And so I didn't know that it was possible to learn the tango at the level that you did. I was a little bit, I guess, more, well, I just didn't have the rhythm of the dancing skills. And frankly, I didn't want to spend my month off learning something that I probably thought I would never use again. So I decided not to do tango.
And instead, I turned to Horse Polo. I grew up in Texas and had ridden horses before. Argentina is really well known for polo. I always thought it was a very romantic, cool, just adrenaline sport.
And so I kind of signed up for polo camp. And so I spent a little bit of the tardé. And so I got there. And after being there for a few days, I got the horse of bonds almost went to the hospital the first week.
It was dangerous, but it was a good danger. It was just like every morning I would go, I'm going to tackle this horse. And I'm going to hit this ball. And so I did that for a couple of weeks.
But the other thing that Argentina is really well known for is their Malbec wines. And if you'd like to drink red wine, Malbecs are fantastic. And so I decided to spend, when I wasn't playing polo time, in these different vineyards and wine cafes. And so in the wine cafes is when I ultimately met a few women that were doing some volunteer work, which ultimately led to the idea that there were all these kids that didn't have shoes.
I'm jumping a little forward in the story. But I chose Argentina ultimately because it was my way of taking a month off and recharging and learning something new, which was polo. So let's jump right into it. You mentioned meeting these women.
Yeah. So I've been in Argentina for about three weeks. But here you have Buenos Aires, which is an amazing city. And there's some poverty in homeless and all the same things we have problems in our major cities in the United States.
But you go an hour outside or even two hours outside the city where we were going a lot for the horses and the fields to play polo. And as I was seeing this and going to and from the city almost every day for the polo and the people for getting out to the farms, I think it was having an impression on me, but it wasn't something that was leading to an action. It was just kind of like, gosh, this is really intense. This is really sad.
I can't believe this much poverty just an hour from this great city. Now almost everyone was speaking Spanish the whole time I was there. I was trying to learn it, but I was not doing a good job. I mean, I could kind of get around with Spanish that I learned in three weeks, but it was getting exhausting.
I mean, you're much better at learning languages and learning very quickly as we know from reading your books. But for me, I had not been blessed with that ability yet. And so I was just sitting at dinner most nights listening to everyone speak Spanish. It was like Charlie Brown's teachers.
And so I'd be like mental solitary in my head until they finally would, you know, someone could speak English. That's my question. So when I hear three women speaking English, I'm just like, you know, be on honey. I'm like, whoa, what are you guys doing?
And like it's so fun to talk to these women. And so they had been there for about the same amount of time as me to her from the US, one was from the UK. And so they were going around to wealthy families and Buenos Aires collecting these slightly issues and then taking them to these towns and these villages outside the city, work, kids, and shoes. And it was amazing because I'd just been like for three weeks seeing kids on the streets, not in school clearly, and not wearing shoes.
And I was amazed by the fact that this was like the limiting factor in their education, but also believed it because I'd seen all these kids on the streets. And so, you know, I'm a very curious person. And I've been playing polo for three weeks and I've kind of like looking for something more to round out my month experience. And so I said, I've never done anything like this, but can I come and help somewhat, you know, I mean, if you're going to be distributing all these shoes the next week, like, can you just use another set of hands?
And I said, absolutely, we love where you come in. And we got there, the kids had been told that they were going to get shoes this day. So there's already this incredible excitement in the air. And when we pulled in, I mean, the kids and some of the parents just started kind of just appearing from all these nooks and crannies in this town that was kind of right next to a garbage dump.
I mean, exactly what you can picture if you see in some bug millionaire. I mean, that's what exactly what it felt like. But there was incredible excitement and enthusiasm because of getting these shoes. And it was hard because the kids, a lot of them, most of them didn't even know what size they were because all they had was like a pair of flip flops and they didn't have a proper shoe.
And so trying to get them fitted and understanding that was a challenge, but we worked through it. And after all the kids had shoes, we played soccer and, you know, and it was just a great day. It was like, that's pretty cool. I mean, he was actually kind of, you know, he first thought it was cool that anyone was doing this for these kids because he knew the area.
But second, he thought it was a nice gesture. And so I was talking about how awesome it was and how excited and how much fun and he was listening really intently. And this time, like, I was, you know, young guy, he's 23 years old, a great ball player, and he's kind of listening. And I mean, he got so excited.
I mean, it's actually his enthusiasm, the reason I'm pretty much sitting here because he's like, this is an amazing idea. We have to do this. Just to put it in perspective, too, the Argentines, especially the, the Portenios, who live in Capitale Fédéon, in Buenos Aires, they're a mixture of all sorts of immigrant blood. So you've got like a lot of Italian, which is where they get the look.
Yeah, they got a lot of Italian. They got a little bit of German and then all sorts of other bits and pieces. But yeah, so very enthusiastic bunch. Yes.
And so Leo, you know, professional polo player, 23 years old, doesn't know a thing about shoes, tells me, and it's not, it's not, at first it's not we, you have to do this. Like, like, your idea, you do it. But I will help you, you know, I will figure this out, you know. And so literally by lunch, you know, I mean, he's, you know, he's, this is the guy who has two cell phones, not because he has a work phone to personal phone because he has two conversations going on at all times.
I mean, it's like, he's talking to someone, so his brother and so his cousin and someone is in the fiddly, and it's all in Spanish, so I don't understand anything he's saying. But it's, it's with enthusiasts and they don't yell at me, and it's like, this is what's happening. And so by lunch, he had already figured out someone friend of a friend who made Albreggad as like in their garage, you know, an hour away. And, and like before I could even say, no, like we're going, I mean, it's like, you know, we are in this.
And I'm just leaving like four days. And so, you know, in that long car ride there and back, because we really kind of talked about it, like my entrepreneur brain started thinking, it's like, you know, I think this, I think this could work. Because first off, I've been wearing this out for God. I love it.
It's like super lightweight, super comfortable. If it gets wet, it dries right away. And there's nothing like this. I mean, the only shoes that are in this kind of canvas slip on are like converse or vans, and they're heavier and they're clunkier and, and I've worn those all these years, but this is a different, so I started really kind of falling in love with the product as well as the idea.
And, and then I recognized that like this didn't have to, it was the first time I had an idea in my life that I didn't think of as a business really, even though I was structuring it as we're going to sell something and give something and it's going to be a business, not a charity. I didn't think of like, I need to do this to make money. Like I had made some money. I had the driver's ed business was going great.
Like that is, you know, it's just, it's just sales or just, or just skyrocketing. I'm a little bit less interested in like starting a business to make money. And, but I'm really thinking this could be fun. And that's the thing I always try to like make sure that people really understand in terms of the beginning motivation.
It was this is, I was connected to these kids and I think we, I think this could work and help them. And it was me a ton of fun because now I was going to go back to Argentina four times a year. I mean, this is a great excuse to go to this country that I'd fallen in love with and Alejo is so fun and other people were, you know, so long story short, we get, you know, we get to this guy, you know, and he's, and we're telling him like, no, we don't want to have like a nice, insole and arch support and all these things are going to make the shoe cost like five times as much money. And he's like, no one will ever buy this.
Like, no one will ever buy this. It's too expensive. And I'm like, no, but we got to make it, it's got to last long because these things were out a couple weeks and like, oh, I just think that even though I didn't know experience in shoes, I just, as a customer, I would want the shoe to look this way, but I want to perform a different way. So, you know, after a couple of days going back and forth and meanwhile, I've now called my partners to the drivers that business and told them it's not going to be a one month vacation, but two months this year.
And so I'm taking, I'm taking another couple of weeks to see if I can figure out the shoe thing. And I hadn't told any of my friends without thinking of doing it or anyone. And, and I, you know, I just, I just started like calling, you know, my sister and girlfriends and friends of mine that I thought, you know, would appreciate the shoe and not telling them the story initially. That was one of the key points.
So selling the product on the products, Maritz? I knew that I knew that the story would get people excited, but I didn't want to like really go into making this a venture unless I felt the product could stand on its own. And so, and plus I also didn't know how much to charge. So I needed to kind of get people's reaction.
Like, do you like it? Number one, number two, how much would you pay for it? You know, because it was such a different shoe than anything else out there. And so I spent a week or two really doing that.
Can I say a question about that? Yeah. So you seem to have a long history of doing market research by asking women. Yes.
You got the thing. We didn't even cover that. We didn't even cover the the theta sorority. Yeah.
Like collaboration with easy longer. That's a whole separate episode. But did you ask primarily women about the... I did.
Even though I didn't think it was, I thought men and women would buy the shoes, but I just felt like I didn't know very much at all about shoes in my life at that point. I knew nothing. What I did know is that every one in my life spent a lot of money and time on shoes. Like, I mean, whether it was my mom or my sister or my girlfriend, they're always buying shoes.
I never really saw my guy friends buying shoes. I mean, obviously they had to because they wore shoes, but it wasn't like they talked about it. So I figured like, let's go where this conversation's all happening. Let's just enter into the conversation.
And so that's why initially my kind of quick market research was women. But it was so cool because I remember this time I saw girls over to the house or the department at the time of Venice. And they thought they were coming over for like this dinner party that I was going to arrange instead of all these shoes on the table. And they were like, what's going on?
I was like, well, we're going to have dinner. But before I want to show you... Turn your dinner. Turn your dinner.
There is no free dinner. I want to hear what you think about these shoes because I'm thinking of selling them. They come from Argentina. And I didn't tell them about the story.
And as I saw them in my living room, trying them on and getting pretty positive feedback of their cute, they're comfortable. I'd wear them with this. I mean, they were kind of talking amongst themselves. Then I pulled out a bunch of photos from my trip to this village.
And I told them the story. And at this point, I've never seen women so excited by pair of shoes. I mean, they bought like three pairs each. I mean, they were telling me, oh, I'm going to call my friends.
She's got to get a pair. It was like this just like... You've been a friend of the... Being frenzy.
And it was because of the story. It was because of the idea of one for one is because up until that point they had never been offered an opportunity to buy something for themselves. They usually feel guilty about, right? Because women buying shoes doesn't always end in happiness.
A lot of it's guilt because they have too many already. This time they had no guilt. It was like the guilt-free shopping of the century, right? So they were buying multiple pairs.
They were telling me other girlfriends of theirs they would get to buy them. Some of the girls worked in PR and were telling me what stores to be in. I mean, it was just like immediately I was like, wow, we've stumbled. I mean, it was like, I hit a nerve.
And so that was really encouraging. And that's what kind of got the initial sales going and helped me figure out how much to charge for them. And the interesting thing about the charging, and this I think is like at some level why in the dictionary, under the word karma, there should be a picture of Tom's, is we charged, we create a model that was basically to break even not to make money. So we want our whole goal was to give as many kids a shoe as possible.
So we wanted to charge a price that would be the least amount that we could charge a customer and still be able to pay for another pair of shoes and have an organization. So even though we weren't a nonprofit, we went into this thinking that we're not really profit is not the motivation. You weren't maximizing the margins. Yes.
So the thing is, is we were making all the shoes by hand in garages in Argentina, which turns out is very expensive, right? So we're making shoes when Tom started to take off and all of a sudden we were selling not, you know, 100 pairs here and there, but thousands, tens of thousands and then millions. We started large-scale manufacturing, our costs went from here to here. And then all of a sudden we had this hugely profitable business.
And it's like, how did we get here? I mean, it was truly, I've never forget after that old problem. It really was this crazy moment when I went with this factory, when the first time we were moving from like garages to factory. And I was like, so how much prepare?
And he gave me a price. And I'm like, is that for sure or prepare? I'm like, I guess crazy how much less it was. And then we realized, okay, we can do the giving, we can do that and we can have a good business and we can make money.
And that was the aha moment of, okay, this is what I'm going to put all my energy by. So in the very beginning, what names did you consider for the company and how did it end up on top? Yeah, that's a great question. So how many people think their name is Tom?
Most people think about that. That's another one question. I mean, you know that Tim's a great interviewer because it's been an hour and 45 minutes until he's asked me that question. Nine times out of ten.
That's the leading first question because it's so obvious. So the name, Tom's. So I wore this shoe today in particular because A is one of my favorite shoes we've ever made and it's also one of the first shoes we ever made 10 years ago. And so what happened was is I originally called them tomorrow shoes.
And the reason they were called tomorrow shoes is that we thought we could make a better tomorrow by selling a pair today and giving a pair tomorrow. So that was our pitch was if you buy a pair today, we promise you that we will give a pair tomorrow to a child in need. And so thank you. And so that was.
And so for the first couple of weeks, they were called tomorrow shoes down Argentina or making them whatever. And then we started looking at all the other kind of casual shoes in the market because now we're starting to think about this a little bit more like we got it. You know, we got to figure out like how we're going to brand the same. And so we're looking at the shoe and this particular is not a lot of places to brand it.
But the most natural place would be on the back. And there's no way I could fit the word tomorrow's on the back of the shoe. It just wouldn't fit. No matter how little the font got.
So I said, okay, we'll call it Tom's shoes for a better tomorrow. And so Tom's coming from the word tomorrow and we chose the Argentine flag because that's where they were being made and we got rid of the sun and put the Tom's in there. And you know, and that's how it started. I mean, that's how the name came.
But you know, it's funny because I mean literally, I mean, still to this day, people call me Tom. And especially in the beginning, I mean, before anyone knew what I looked like and they just assumed that there was this Tom. And one of my favorite, favorite stories is in order to sell the shoes, you know, it's like anything else that's not really like the story is as important as a product. You got to make sure you have a good product, but you know you've got to convey your enthusiasm.
And so when I first got into Nordstrom, which was pretty early considering how small business we were, they said, well, we'll sell your shoes in these stores in like Southern California, but you have to commit to going like every Saturday and really sitting there next to them and like telling the story because the story was what was so interesting. And so I said, fine. Okay, I'll do whatever, you know, like so I would go and I never forget this one manager. I got there on Saturday morning bright early.
I'm all excited and I'm like, Hey, I'm Blake. I'm here for to sell the Tom shoes and she was going to me. She goes, Oh man, we have a problem. And I was like, what's wrong?
She was we've been advertising for like a week that Tom is coming. And I was like, I am Tom. So, so I used to carry my laptop everyone like quickly have it up like that. So you think, Tommy, that's me.
Like the same person. So the times that we live in right now, it's very romanticized to go out and raise hundreds of millions of dollars in venture financing was something very complicated. Yes. The businesses that have worked for you that we've talked about started off addressing a frustration or an eat of your own simple and low capital requirements, at least in the very beginning.
No, the only business I ever raised money for was the business that failed. And that was the reality team channel. So, I mean, that was the thing about Tom's is we never raised money and because we started small 250 pairs, then it was 1000 pairs and then it's 2000 pairs. And as we started growing, we were able to, you know, bank loans and things like that to finance inventory.
But I mean, that's one of the things I think that allowed us to preserve who we are today 10 years later and 75 million shoes given and all these things happen because we didn't have that influence that comes from investors and then their demands and how fast you got to grow and things you got to do. So I always say to entrepreneurs like there are some businesses that inherently have to raise money for her. So, every day, if you have a good idea and you can execute, every day that you wait, your idea and your company becomes more valuable. And the more leverage you have.
The first time I saw someone wearing Tom's is like a really special moment. You know, it's kind of like maybe an artist, the first time sees their painting hanging in a gallery. You know, I mean, anyone who's created something of any magnitude is proud when they see it. Especially they see it on someone that's a stranger that bought it without you begging them on a floor in Nordstrom, right?
So, about four or five months after we started Tom's and this is before we even in Nordstrom, we're only selling them online. And mainly the only people I've seen wearing them are my neighbors because all of our neighbors in the neighborhood that I was going through, we were kind of running the shoe company out of the apartment in Venice. So they were buying them. My interns and my family, of course.
And I was in New York City and I had actually had a very bad week. I'd gone trying to get new customers like retailers like the American Rag and I had just struck out. Like, I mean, New Yorkers wanted to have nothing to do with the shoe. And so I was going back to LA kind of a little bit with my, you know, tail between my legs.
I wasn't even wearing Tom's, I was wearing some, you know, some running shoes or something because I'd gone for a run in the park earlier that morning and then I was rushing to the airport. And I get to the American Airlines check in counter and I'm doing the kiosk. And I'm not checking back, she's doing it quickly. And I looked to my right and there's this woman and she's wearing a red pair of Tom's mid 30s, like wearing pair of jeans, pair of red Tom's.
And I'm like super excited. And, but at the same time, I'm like really curious to like, where did you get those? What do you think about them? Like, I mean, my marketing head, my focus group head just goes straight to it.
And so I say, excuse me, I couldn't help but notice these red shoes are wearing. They're really cool. What are they? And I'm still doing the checking because I don't act like I'm too interested, right?
And she looks at me and her eyes kind of widened and she goes, they're Tom's, Tom's shoes. And I'm like, oh, that's cool, you know, and that's great. And I'm kind of like just taking, you know, waiting for, she says, and I can tell she's like looking at me like, no, I have more to tell. So I kind of turned her and she looks at me like really intelligent.
She goes, no, I don't think you understand. This is the most amazing company in the world. When I bought this pair of shoes, they gave a pair to a child in Argentina. And I'm like, oh, really?
And then she continues, and there's this guy. He lives in Los Angeles. I think he lives on a boat. And he's eight feet tall.
And she literally starts telling me my life story word for word like with more passion than my mom tells it was incredible. And so she's going on and on about this and that. And at some point I was like, oh my gosh, I have to tell her who I am now. And there's other people listening.
I mean, she's animated. And so I say to her, I say, excuse me, actually, sorry to interrupt. But I'm Blake. I started Tom's.
And she just pauses. And it's like, deer in headlights. I mean, you could hear a pin drop. She looks at me.
She looks at me again. She goes, why did you cut your hair? But the interesting thing about that question, and when I learned a huge business lesson in this question, the reason she knew I cut my hair is she had watched every video on YouTube about our shoe getting. And this is right, 2006, right when YouTube saying your YouTube launched.
And because there wasn't a lot of content on there, our video's got a lot of views back then. And she'd watched it and seen it. And so I realized that she wasn't just a customer. I mean, she took the time out of her check-in to tell me the entire story.
I'm choosing evangelist for Tom's. And so much that she kind of didn't recognize me because I'd cut my hair short like this and before the video was really long and bushy. And so it was so funny because on the way home, I realized we didn't need to focus on marketing and advertising. That's not what got this girl to buy her shoes.
We need to focus on doing our giving and making sure that content was easily shareable with our customers because if she was this passionate to tell a stranger at the airport, surely she had posted on Facebook about it, tweeted about it, probably bought a pair for her friend for Christmas or whatever. And so it was an amazing experience for me. And it really has kind of dictated our whole philosophy on marketing for the past 10 years. And that is if we do what we say we're going to do and we create interesting content that allows our customers to share with pride what they've done because it's really them.
And we set it up and unless we sell shoes, we don't give them away. So it's what they've done then the momentum can build. And I think that's why we had this exponential growth. So this is a related one.
This is actually from the extended family known as the internet. Facebook. This is not like the drunk angry uncle though. This is a nicer member of that Christmas party.
So Daniel Roddick I think that's his name. And I'm going to show us a little bit. But there's a term I've heard used before called WFIO, which stands for reflect. It's over.
And essentially when your business seems like it's on the brink of death or failure running out cash, PR crisis, move back to better, et cetera, et cetera. So the question and it goes on. This is a long question. But I was just wondering if you had any particular examples.
Yeah, from Tom's if they were any sort of existential threats when you're like, oh boy. There's one just I mean, as clear as day. This is in the second year. We now have made that transition from making a big garage to a big factory and knowing nothing about how to negotiate with factories and factories can smell, nivotay, like a mile away.
We totally got screwed over by factory and we had taken all these big orders. We had taken all the cash that we had. I mean, not just Tom's, but like me personally, out of my personal checking account, the order of issues, knowing that we were going to sell them for profit and then we would be able to just a cash flow thing. And I never forget, I was my dad.
And it was actually the day I was getting the sailboat that I was going to live on. I lived on a sailboat for six years. It's a whole other story about essentialism and not having stuff you don't need in your life and simplifying your life, which I was very intent on doing after spending so much time in Argentina. So I'm going to get the boat with my dad, like it's supposed to be a great day in my life.
And I get a call and it's Sean actually, the guy you saw. And he's like, we have a problem. And I'm like, what is like every single soul on the shoes are falling off. Like they're not like not good quality.
Like they're falling off. Like the glue they use of the factory got hot on the way here, whatever. It's like, it's disintegrating. And all these people are expecting their shoes and all your money isn't this.
And like we don't have money to order my shoes. I mean, it was definitely a with the whole moment that there ever was one. And you know, it was, I really did think it was going to be over because I mean, it was like it was, it was just one, we were going to call these people and say we didn't able to deliver and it would take weeks and months to get them. And this is at the point which we now have big customers, you know, like the urban outfitters and Nordstroms and they don't just like take this news lightly.
And the second was, there was all our cash was in there. I mean, there was no more cash for our machines. I mean, ultimately, the way we saved it was we were able to convince another factory that if they would make the shoes without any initial payment that we would be able to pay them within 90 days and we would switch all of our business to them and they did and they were a great factory for a long time. But I didn't even know there was a possibility that came after like days of like probably heavy drinking and like, you know, putting myself in a hole and a whole and we shouldn't come out.
But yeah, I mean, I think every business has that and ultimately if you get through it, it makes you stronger. Yeah. But the truth is, there probably kills a lot of businesses too. In retrospect, were there any warning signs or anything that you could have, are there ways you could have avoided that?
In that particular case, I don't think so because we didn't have the brand reputation or the cash flow to have any leverage over factories, but we needed factories and at the same time, I just, we didn't have the experience level to know how to protect ourselves from that. Now in hindsight, there's lots of things you can do to protect yourself with factories and payment terms and all these things. So I think it was just a situation where we were unlucky and a factory kind of took advantage of us and they probably thought they would never get another order anyways. So they didn't take it too seriously.
And so if you were advising somebody and I know this is going to be small percentage of the audience, but actually I mean, growing percentage, we have people now launching business on Kickstarter. It's like, okay, good news bad news, right? We have 5,000 orders. Yeah.
So we've told a really good story. What advice would you give to someone who's looking at manufacturing in the first time? I mean, I would say the best thing to do when you're manufacturing for the first time is have the manufacturing as close to you physically as you can, even if it's a huge difference in margin, difference in price. Because what you're trying to do in the beginning is prove a model.
You're not trying to necessarily make money. So if you can, if it costs 80% more to do it in your hometown than doing it overseas or to do it in your hometown, you can watch it be there, then you don't have the surprises. The thing that kills you is manufacturing, especially from a far off place is the surprise when it comes not being what you thought it is and by that time it's too late. So the nice thing is, is if you're, or you just move to wherever you're manufacturing, I mean, one of my favorite, you know, entrepreneurs is Fernando and Santiago who started Reef Sandals.
And these are Argentine's actually as well that I got to know through the years being the shoe business. And Santiago moved to Brazil and lived like at the factory for those early years of Reef to literally watch every shoe being made. And that's why their quality was so good and that's why they built such a great company. So sometimes if you can't make it locally, you go there.