Product Startup Podcast Episode 087: Build a Product Brand With Purpose

00:00:00 Kevin Mako: Hello, product innovators. Today we learn from the founder of one of the world's largest home product brands on how to use purpose to design and sell great consumer products.

00:00:11 Narrator: You're listening to the Product Startup Podcast, the show that helps bring your product idea to life by chatting with successful inventors, product developers,

00:00:22 Narrator: manufacturers, and hardware industry professionals. Our goal here is to get to the bottom of what makes a product successful, from initial idea to getting your product on store shelves.

00:00:32 Narrator: We're taking you step by step to build a functional product and scale your product business. Hosted by Kevin Mako, one of North America's leading experts on hardware development for small product businesses.

00:00:45 Narrator: Now, onto the show.

00:00:48 Kevin Mako: Welcome back, everyone. Today I'm very excited to introduce Paul Rowan to the show. Paul is the co-founder of Umbra, a household product company that designs, manufactures, and sells hundreds of consumer products all over the world. You likely have at least one of their products in your home right now.

00:01:02 Kevin Mako: Paul ran Umbra for 37 years, starting the entire company with just one product. Today, Paul is going to share some valuable knowledge on how inventors, startups, and small manufacturers can use both strategic purpose and higher purpose

00:01:14 Kevin Mako: to create a great first product and your first product business. From there, how do you leverage those principles to scale into a global product brand as he did with Umbra?

00:01:23 Paul Rowan: Now on to the episode.

00:01:26 Kevin Mako: Paul, welcome to the show. Hi, Kevin. Thanks for having me. This is great. Excited to have you on.

00:01:30 Paul Rowan: I see in your background, you're in like some, crazy creative art studio. That's at your farm. Yeah, well, we have these outbuildings and we converted them to studios. So yeah, my wife does a lot of painting in here and it's kind of like a very

00:01:43 Paul Rowan: quiet space to do something like this recording. So that's why I'm here. The house is really busy

00:01:49 Kevin Mako: with dogs and babies and all kinds of stuff. So this is a nice spot. That's perfect. Sounds great. It seems like a very like a Zen space there based on a little tour you gave me before the show. I want to jump in today just into the topic of purpose, which is the first time.

00:02:02 Kevin Mako: we've talked about this on the show. Obviously, it was a big element of success with Umbra, a massively successful international product company. But let's go back to the very beginning.

00:02:11 Paul Rowan: You were at Umbra for a long time, I believe, since 1980, of 37 years. Yeah, yeah, it was quite a run. It started with, it's funny, quite a few of the executives in the team that founded the company over the first few years, were musicians that we had,

00:02:25 Paul Rowan: we had bands with. So it was like, we all knew each other from that pursuit, and we were creative. We were trying to do really fun things. We were being social. We were communicating with

00:02:37 Paul Rowan: each other in the music. But that's what I really, when I look back at it, people always ask me, oh, what's, you know, the relationship between design and music? And I said, well, it's about being, you know, for me, the perfect design company or any company would be modeled on like

00:02:52 Paul Rowan: an improvisational jazz band where you have like all the different musicians like playing really unique, interesting stuff, but also having to really listen to each other to create the

00:03:02 Paul Rowan: composition. So if you can do that in business and empower your people to be really creative and contribute that way, but also be part of a team effort that's going to be working towards

00:03:14 Kevin Mako: one goal, which is like the music composition. I think that's the ideal kind of formation for a company. You know, we had quite a few episodes ago, we had a 22-year Apple executive, Michael Hageloh on the show. And he said part of the Apple executive,

00:03:28 Kevin Mako: executive team. And I think he even wrote a book on it. They operated. He coined it very much like a band. Really? I think of that episode because it wasn't all about that, but he highlights a couple

00:03:39 Kevin Mako: elements about that. But when he used to work with Steve Jobs and all that stuff, so they used to talk about it regularly. It was like this cohesive band and there's, you know, a lot of flow and interaction that happened and creativity that occurred. But he always would come back to this reference

00:03:52 Kevin Mako: of the band as they were going through. And I think it was, and also from the 80s, moving into

00:03:58 Paul Rowan: the 2000s. But it's very interesting here. Another successful product executive and yourself saying a very similar thing. So that would be the key for people's, you know, structuring their

00:04:08 Paul Rowan: businesses. Can you actually create something as free moving as a like improvisational jazz band? I mean, that's the challenge. Because you have to have, instead of people just doing your bidding,

00:04:18 Kevin Mako: you have to be able to empower them to be individually creative and and help drive your company forward with their contributions.

00:04:25 Paul Rowan: So I remember you mentioning that,

00:04:28 Kevin Mako: one of the early days in Umbra, you grew up in a hardware store.

00:04:33 Kevin Mako: Yeah, my dad had a hardware store in the west end of Toronto. Yeah, and you basically looked at the stuff and you said, I can do a lot of these products better. And that was really kind of the early idea was from what I heard from you, fairly straightforward.

00:04:46 Paul Rowan: I can do these things better. But then it evolved to something so much more. So why don't you just walk through the early days of Umbra with us? Well, yeah.

00:04:54 Paul Rowan: Yeah, so my dad really taught me everything about applied technology from sweeping the floor to plumbing, to electrical, to salesmanship, to, you know,

00:05:04 Paul Rowan: dealing with customers, to inventory, you know, knowing 50,000 skews, you know, without, you know, thinking about it, knowing the pricing. I mean, this was like all my background for like many, many years as a kid growing up there.

00:05:17 Paul Rowan: So when it came time to sort of invent my career and do something, and I was very interested in design, I went to George Brown for graphic design, I started to just be thinking about, I don't know, just being, I guess I was just a natural entrepreneur about

00:05:32 Paul Rowan: trying to develop ideas. I moved to Ottawa to work for a company that was one, a very innovative company that was doing the first computerized type setting. But as soon as I got there,

00:05:42 Paul Rowan: you know, me and the guys were thinking about ideas over beers almost immediately. What were going to do? Are we going to start a company? And I started several while I was working in that company.

00:05:52 Paul Rowan: But then I moved into an apartment and the windows were bare and I just decided to do something original.

00:05:59 Paul Rowan: So I went out and bought some kind of architectural paper that sort of resembled Japanese paper and I mounted them on roller blinds and then created prints on them and hung them in all my windows and people kept coming over saying, oh, where can I buy these?

00:06:13 Paul Rowan: And, you know, I took it to my business partner in 1979 in Toronto.

00:06:24 Paul Rowan: And yeah, he said it was less amount of palm and he said, yeah, let's start this business out of this. And it was like just a big change in my life, like how, yeah, we're going to make one of these products. We're going to take it to market. So it was at the time. I just wore every hat.

00:06:39 Paul Rowan: I was a manufacturer or a designer. I was branding. I mean, it was great to have that background of graphic design. I think that was, I really encourage people to be able to be great communicators through that kind of training. and it was able to develop the company.

00:06:54 Paul Rowan: When we first took the product to the trade shows, like in Chicago, Housework Show, people thought we were a lot bigger company than just two guys, you know, because we had that professionalism about, you know, branding, trade show, booth design, like all these things. I mean,

00:07:09 Paul Rowan: I think that's really essential for startups to have that kind of

00:07:12 Paul Rowan: multidisciplinary background to be able to launch these ideas. And then eventually, once we got that idea out there and actually it wasn't even the best idea. It lasted for a few years,

00:07:25 Paul Rowan: but it put us in the market. So they sent the message here is like whatever your ideas, get embedded in the market, start learning about the sales channels, start getting sales channels in place, distribution,

00:07:37 Paul Rowan: relationship with retail customers in our case,

00:07:40 Paul Rowan: and just start growing. And then people kept coming to us after saying, like, what's your next product? We want more. We're going in, we're selling these customers. We don't just want a couple of skews. We want to build out the line, so it's much broader.

00:07:54 Paul Rowan: And then that was the challenge. It's just through the gauntlet down. I said, okay, yeah, here's our next product. We use off-cuts from the blinds to create placements. And then we started getting into more houseware items,

00:08:06 Paul Rowan: injection molding, and just expanding the line, like, so that and we realized, too, that, you know, we didn't know what nobody, you don't know

00:08:14 Paul Rowan: these products could, you know, you could work on them for a year. And then the instant you put it in the market, it could fail. It could be because it's not competitive. It could be because of competitors. It

00:08:25 Paul Rowan: could be, it didn't meet the, you know, users' needs. And so we just kept doing more and more product and just flooding the market with really interesting designs. What we did find, though, there was a big

00:08:37 Paul Rowan: void in the market for this kind of casualization of products to suit, that kind of lifestyle, like simple,

00:08:47 Paul Rowan: modern,

00:08:48 Paul Rowan: affordable, those are the kind of ideas we had. And,

00:08:53 Paul Rowan: you know, that's when we started looking back and say, okay, what is the purpose? The purpose was for us to launch our careers, to have something to do. Entrepreneurs want to get things out there done. They want to be successful. They want to get recognized for it.

00:09:06 Paul Rowan: But then we started in retrospect saying, hey, what is our purpose? And we started seeing this kind of democratization of design as the, essential purpose of the company.

00:09:17 Paul Rowan: So when we created this kind of purpose and statement, we started to write down keywords associated with the brand.

00:09:24 Paul Rowan: And then we could talk to all our vendors, our recruits, our employees about what the

00:09:32 Kevin Mako: purpose of the company was. And then that started to attract young designers, better vendors,

00:09:41 Kevin Mako: you know, global

00:09:44 Kevin Mako: vendors and customers. So I think this was really essential for our growth.

00:09:50 Kevin Mako: That's amazing. A couple of things I want to unpack there, especially from the beginning. It's like first and foremost,

00:09:57 Kevin Mako: you just started out with one product. But something else you mentioned is you worked really hard to make that a very quality version, or at least a very professionally presented, professionally built product, which you said was very important for the first.

00:10:09 Paul Rowan: I think the really interesting thing here is the fact that you started with one, you did a really good job at it. And what that allowed you to do is build the market. And then that market, the customers in particular, which would be, I guess your retailer

00:10:22 Paul Rowan: or wholesale buyers, those folks are the ones who started driving you to start expanding the product line from really what started as just one thing. It's really true. And then that just leads me to the discussion about who your stakeholders are and who you're

00:10:37 Paul Rowan: partnering with with like everyone along the line. And if you can bring them in as partners, as the virtual partners, they may not be financial, but they're all stakeholders. They're involved in what you're doing. The retailers want new, innovative product.

00:10:52 Paul Rowan: They're going to tell you the situation of the market. They're in touch with their customers, right? We're not. We're like sitting there as designers, manufacturers. The retailers are face to face with the customers. This is in the 80s, by the way.

00:11:03 Paul Rowan: So now we have the opportunity of averaging being face to face with our consumers, which changes everything. But yeah, we always. had great partners that were informing us about the business, about technology.

00:11:15 Paul Rowan: I mean, sometimes technology was the biggest driver of a new product for us. Like when we saw a new plastic material or an additive or effect,

00:11:26 Paul Rowan: we started to incorporate it in the product and really made us an innovative and stand out.

00:11:31 Paul Rowan: It's true what you said that the first product is really the most important because you've got to get it in the market. You've got to have some measure of success. It doesn't have to be perfect.

00:11:41 Paul Rowan: Yeah, some some entrepreneurs will just wait, wait and wait to get the thing perfect and like in the market can really pass them by.

00:11:48 Kevin Mako: It's really important to get something out there that's going to be good and decent enough that you can support and get it out there.

00:11:56 Kevin Mako: Now, today, of course, with the consumer as advocate and liking or not liking you, you can pretty instantly, you know, fail by a lot of bad reviews.

00:12:06 Kevin Mako: So you have to be a lot more careful these days about the kind of quality of the product that you put out. That's certainly something that people are really, you know, judging you for and service.

00:12:17 Kevin Mako: We're a big advocate of less features, but higher quality on the features that you're doing, right? Keep it to a, we call it smart MVP and our design language that we use in the design firm is brilliantly simple design.

00:12:31 Kevin Mako: And it's something that we, especially with our startup customers, something that's really important to say, look, you don't need every bell and whistle on here. But the couple of bells and whistles are your main value add, make sure that you do those and you do those well. Because, yes, those reviews and everything like that,

00:12:44 Kevin Mako: it is much more of a dynamic, real-time environment. But I like what you say, it doesn't have to be perfect. And that I think is the real key here is for the listeners to understand here that what Paul is not saying is just to release whatever you can to the market,

00:12:58 Kevin Mako: saying release something that's of a good, a reasonable baseline quality and done in a professional format, everything from the way that you're pitching it to the actual product itself to the quality of your manufacturing, your customer relations, all your stakeholder

00:13:12 Kevin Mako: relations along the way. That has to be done well because that's going to be your initial flag in the market. And that is, you know, and Paul is a great example of where he took this

00:13:24 Kevin Mako: from being that first product and then leveraged ensuring that it was quality so that it built from there. And then, of course, now that brings us into the next portion of the topic, which I'm really excited to talk about the meat today is passion and really revolving around

00:13:39 Kevin Mako: purpose, right, and the purpose of the company. And one of the things that you mentioned, as you're kind of getting into the purpose that I think is very interesting, especially for hardware startups, is that it didn't, it wasn't a purpose that was necessarily baked in

00:13:51 Paul Rowan: or a corporate vision that was baked in from day one. It evolved over time. And it utilized something you also mentioned, number of the stakeholders throughout that process. So can you kind of go back to that time where you're forming that vision?

00:14:06 Paul Rowan: First of all, how did you do it? Is it something that you wrote down? And then how did you actually involve those stakeholders to come up with that kind of corporate purpose, personal purpose, corporate vision and all of that that kind of went into

00:14:19 Paul Rowan: growing an international huge success brand of umbrella?

00:14:24 Paul Rowan: Well, you know, I think as we said earlier, like when you first started off, I think it's really difficult to define your purpose because you don't really know what you don't know. I mean,

00:14:36 Paul Rowan: but, you know, as you see some successes from the kind of product offerings that you do, just through pure creativity, I mean, it's an intuitive process at first for designers.

00:14:46 Paul Rowan: Like, you know, usually the stuff that I see that's really good from designers is something born out of necessity.

00:14:53 Paul Rowan: So in my case, it was those window shades, right? But a lot of other designers might have some, you know, obstacle to living well. in their homes, how they want to improve things and so forth and invent things to, you know, solve that problem.

00:15:07 Paul Rowan: And so that's a good start, necessity. I mean, necessity is something that's really closed to home. As a designer, you don't have to be looking at some research reports about how a woman lives in Midwest, U.S.

00:15:20 Paul Rowan: between the ages of 20 and 30 and design something for her. I mean, that is a very difficult thing to do, actually, to really put yourself in her place. but to do something out of necessity for yourself,

00:15:32 Paul Rowan: I think that is something that you really can bank on. And then there's so many other triggers for good design. You know, like,

00:15:40 Paul Rowan: you know, at one point we said, okay, we want to do something really artistic to, you know, hardware, to product.

00:15:47 Paul Rowan: Everything should be done artistically, the way we treat it. We're going to follow the strongest art movements in Europe. We're going to look at all the kind of influences that has

00:15:57 Paul Rowan: and incorporate that into our products and become and elevate the product through art. And I think eventually this kind of collaboration with Caramachid was really a big turning point

00:16:07 Paul Rowan: for us too when we said, okay, hey, we were doing, I was doing all the design work myself and kind of overloaded. He said, well, maybe we should be farming out some design. And we worked with Caramachid and ultimately developed the garbino can, which was changed

00:16:22 Paul Rowan: the market forever for us. I mean, it was the first injection molded product. that was really sculptural and beautiful, essential, well-priced, and a terrific hot seller in the market.

00:16:36 Paul Rowan: And one of the first low-cost items as part of this democratization of design, as we call it, that was recognized by the Museum of Modern Art in New York, so in the permanent collection right beside a Lamborghini.

00:16:49 Paul Rowan: So you can imagine that notification I got from them, that letter is saying that, hey, your products is valid as a Lamborghini, I mean, that was really incentive to me to just push forward with more and more product.

00:17:01 Paul Rowan: So every way, step along the way when you look in retrospect,

00:17:07 Paul Rowan: you learn about what your purpose is and you see what the successes were.

00:17:12 Kevin Mako: At some point, you have to say, okay, we need a strategy. We're growing.

00:17:16 Paul Rowan: We've got more and more employees. We've got a global vision to expand our business. How do we bring everyone together? And you have to, we wrote it down. Yeah, we created keywords around.

00:17:27 Paul Rowan: the business and that formed the kind of idea of what our purpose was and we followed that in fact we had meetings every meeting we had where we had especially new recruits in

00:17:40 Paul Rowan: there we talked about our purpose we went around the table talking about the keywords so I think this is something whenever I talk about startups today about you know creating a brand

00:17:50 Paul Rowan: and we talk about keywords a lot like define your purpose through keywords are you able to share what some of those purpose values were. Yeah, absolutely. You know, it was modern.

00:18:03 Paul Rowan: This is a kind of checklist when you say, okay, anyone, you know, people used to come to me all the time and say, Paul, I got the perfect product for you, right? And then they'd show it to me and we were so disappointed, like, be nothing to do with anything we were doing, right?

00:18:15 Paul Rowan: So, like, there's a checklist that you have for everybody when they're showing us product, developing ideas, you know, modern. It's essential that it'd be modern, you know. It's essential that it'd be really new, you know.

00:18:26 Paul Rowan: unique and innovative. So if it's not innovative, it's not modern, we're not going to do that product, right?

00:18:32 Kevin Mako: It also has to be affordable, accessible, you priced.

00:18:36 Kevin Mako: So that's a huge, you know,

00:18:40 Kevin Mako: definer of what the product is. Like anybody can do anything at any price, but can you do it so that it's accessible so it could be, you know, mass produced so you can deliver it and it can be accessible, you know,

00:18:55 Kevin Mako: functional. okay so we don't do just frivolous things we just we don't do everything we do has a kind of function to it so you have to build in that form and function balance

00:19:05 Paul Rowan: innovative modern and accessible so those are things that we talk about all the time now eventually that purpose you know has to evolve too because those are kind of kind of functional

00:19:16 Paul Rowan: purposes there's other purposes that are even more important than that today so

00:19:25 Paul Rowan: can you go through those as well. Because I find that quite interesting because earlier in the business, generally, like, your first purpose is to pay the bills.

00:19:36 Paul Rowan: And you said it earlier, your original purpose was to make a career for yourself.

00:19:41 Paul Rowan: But as the business evolves, it becomes more strategic. And that's when you get into your functional purpose, which is what you highlighted there. And then you had

00:19:50 Paul Rowan: the luxury, as the business became kind of a world-class company, you had the luxury and the ability and the foresight to actually evolve the purpose to something even more. So can you walk

00:20:02 Paul Rowan: into what that more was for Umbra and for you?

00:20:08 Paul Rowan: Well, I think it's around a community. You know, like the first thing that you think about is like, why, who are we and why are people attracted to us and how can we create a community around that? And, you know, when you talk to people

00:20:20 Paul Rowan: but umber particularly there's always um so many um positive um you know reports and like criticisms whatever of the product that it's just overwhelmingly about making their life better you know

00:20:35 Paul Rowan: like everyone just loves the idea of improving their life overcoming obstacles in their lives and even in the day-to-day you know drudgery of doing your kitchen work or you know bathroom things or

00:20:47 Paul Rowan: whatever, the kind of things that you really hate doing, cleaning, you know,

00:20:53 Paul Rowan: anything to do with that is like horrible. And how can you make it better, easier? And also make it like a piece of art when you look and you walk, walk in, you see your soap pump on your, on your bathroom vanity that

00:21:04 Paul Rowan: it looks like a piece of sculptural art. I mean, transforming, you know, day-to-day product into art is like such an important purpose for the company.

00:21:15 Paul Rowan: You know, and today now, everything has to to revolve around,

00:21:20 Paul Rowan: there's new purposes that are mainstream now. If you look at surveys from millennials that are, you know,

00:21:29 Paul Rowan: growing and purchasing power in the market, there are other definitions that they're looking for, for how they decide to make their product buying decisions. So certainly sustainability is a big one.

00:21:42 Paul Rowan: Now, when we were developing a product, we always had a sustainable idea, but it was very difficult. For example, in plastic, just to get recycled plastics and to be able to use them, you know, 20 years ago in a consistent way was almost impossible.

00:21:57 Paul Rowan: You know, you couldn't get it, you couldn't buy it.

00:21:59 Kevin Mako: It was inconsistent a distribution of those products. You could only do them in black, you know, because it was always reground, you know, really. It was kind of ugly, the situation to do things sustainably. Now that's changed.

00:22:13 Kevin Mako: Now you have options, right?

00:22:16 Kevin Mako: I'd say, you know, the way you treat your workers, the community around your workers, how you have to treat them. And it's not like management versus employees anymore. It's a much more transparent relationship, right?

00:22:30 Kevin Mako: So those are really important. And then when you realize, you know, at the beginning you're thinking, oh, you have employees, okay, like either do what I say or just get out of my way kind of thing. It's a horrible type of mentality that I admit that I'm guilty of.

00:22:43 Kevin Mako: But I think today now you have this kind of relationship with your employees that's a lot different, that to attract them, to be able to, you know, keep them, to train them.

00:22:55 Kevin Mako: I mean, these are really important things,

00:22:58 Kevin Mako: you know, the environment.

00:23:02 Kevin Mako: Just, you know, things are, things are a lot different today about those kind of buying decisions that people are making.

00:23:10 Paul Rowan: I feel like I had a very similar trajectory when building Mako Design where at first you know, you're paying the bills and then you get into your real kind of functional purpose, which creates an incredible firm with incredible services.

00:23:24 Paul Rowan: And then you eventually get to a point where the community and these greater purposes. And I find a lot of that was actually things that I discovered as the feedback was coming back in, something you mentioned, the reviews when people say, oh, this thing changed my life.

00:23:38 Paul Rowan: I could no longer do this and now I can or this is beautiful or whatever else. So now you're improving lives. And that kind of comes around in the end. And I feel like I was much like you or it evolved over time.

00:23:49 Paul Rowan: So what I want to know from your perspective is, are there things looking back where you have these greater purpose and values that developed over years and years that people who are in the early stages of developing a hardware startup can maybe get ahead of the curve,

00:24:04 Paul Rowan: things that maybe they could implement early so that they can start attaining some of the value and the benefits earlier on, or things that you wish you had have done earlier that would have really kind of amplified that as opposed to, you know, getting there 10, 20 years down the

00:24:18 Paul Rowan: road, as I feel both you and I did with our respective firms.

00:24:23 Paul Rowan: Well,

00:24:24 Paul Rowan: I did a lot of things wrong. I mean, I also did so a few things right, you know, like, but I maybe did things wrong, actually, because I think this is the kind of thing that you can, can you build a business when you know you're going to make a ton of mistakes?

00:24:38 Paul Rowan: it's going to be really costly.

00:24:41 Paul Rowan: And can you, do you have the pocket, deep pockets to be able to survive like a failure?

00:24:46 Paul Rowan: Do you have, you know, the right people that will be able to stick by you?

00:24:50 Paul Rowan: I mean, these, you know, because this mistakes are just enormous. Like almost every business plan I look at, I say, well, whatever your cash, whatever cash you need, pretty well double it. Like almost every proposal I've ever seen. It's wrong.

00:25:03 Paul Rowan: It's way more expensive than you think because you're going to make so many mistakes along the way.

00:25:07 Kevin Mako: So that's one thing I would say to start us is like for sure, like whatever you don't know what you don't know, so you better have a strategy to be able to, you know, be able to respond to a, you know, a bad situation,

00:25:20 Kevin Mako: you know, but luckily, you know, being able to stay in the game until you really can get that product that will catapult you with success, you know, you'll have

00:25:29 Kevin Mako: so many items that will maybe just keep you afloat, but then you're wait for that one that will really sort of get you that brand.

00:25:38 Kevin Mako: recognition that you know a product that will be aligned in in buyer's minds with your brand you

00:25:44 Paul Rowan: know something that's really unique you know that's what you really sort of strive for and you don't know what that is until you can actually sort of get yourself into the market like deep into the market where you can actually sort of emerge with the solution that nobody else has ever thought

00:25:59 Paul Rowan: of i mean this is the kind of moment the epiphany just so exciting you know so i've had those maybe in in the 110 degree office in Indonesia, you know, working on some product when they bring me a sample.

00:26:14 Paul Rowan: And I thought, oh, this is it. All right. This is it.

00:26:18 Paul Rowan: You know, but how many years and how many hours of toil and working in really bad conditions in Asia and different factories and until you hit that moment? I mean, you just have to immerse yourself in a lot of work and a lot of trial and error.

00:26:32 Paul Rowan: I mean, something I like that you mentioned earlier, too, especially when we're talking about scaling is that when you scale, it's a good idea to experiment. You mentioned that the way that you did experimentation was trying a number of different products because you knew inevitably some

00:26:47 Paul Rowan: were going to fail.

00:26:49 Paul Rowan: So your way to essentially overcome that was diversify the portfolio, invest in more products so that when a few fail, it's no big deal. And the ones that end up doing

00:27:00 Paul Rowan: well, do well. And then like you mentioned, you hit some that are just the home runs. And that can

00:27:06 Kevin Mako: really scale a business. But it all comes back to that first one and doing your best, doing a good quality project professionally presented on that first product. So you at least can get into the market to start getting some of that market intelligence back to you.

00:27:19 Kevin Mako: You must get into the market in some decent way, I think, at least to get some excitement. Right. You know, it's the old 80-20 rule. Like, you know, when you look at most companies,

00:27:27 Kevin Mako: you know, 80%, only 20% of their, all the skews that they make are driving probably 80% of their product,

00:27:36 Kevin Mako: 80% of their profits.

00:27:39 Kevin Mako: You know, it's, it's, it's like you really, most products on the shelf are about keeping shelf space,

00:27:47 Kevin Mako: but there's always going to be, I would say like almost every brand that's out there. I don't know. I was really shocked, yes, a couple of days ago. I was in the grocery store looking at, you know, I like looking at brands and how they're displayed. I go by the Cheerio section.

00:28:00 Kevin Mako: I never realized that the Cheerios actually had about 50 skews across about 8. eight feet of grocery store shelves and the main one Cheerio is the plane whatever that one is is

00:28:13 Kevin Mako: probably 80% of their sales but they maintain that you know eight feet of brand just to keep that shelf space to maintain their brand so there is this idea of creating collections like we we

00:28:26 Kevin Mako: immediately started to create collections around individual products so that we could have that kind

00:28:31 Paul Rowan: of visibility on the shelf i think that's something that we learn pretty quickly create collections, create excitement, and create a story around your product. You know, one item is really good, but you're not going to get that visibility necessarily

00:28:43 Paul Rowan: that you need to move your company forward. And if we look at the, you know, whether you want to call it, you know, the purpose that

00:28:54 Paul Rowan: kind of evolves over time, are there things at like a mature product company's purpose that you can start doing as a startup? And we see a lot of this today where, you know, it's essentially purpose. purpose-driven startups. And it's a coin term now.

00:29:09 Paul Rowan: I think it's a very exciting thing. One of the big things that we have with our clients is be the human behind your product, like you yourself, as an individual. I understand, you know, you might not be in sales or you might not be in design

00:29:22 Paul Rowan: or whatever else, but you're the one who's created this in innovation or invention or your kind of first starting product. Put yourself behind that. That you, of course, believe in it, but that there's a personality, a human, an individual that cares about, you know,

00:29:38 Paul Rowan: XYZ problem that you're solving. And immediately that creates a whole new level, I would say, of passion or purpose behind the brand, especially in the eyes of your customers. But it allows you to be much more engaged and interactive, which is something you said

00:29:51 Paul Rowan: was key, no matter what size of hardware company that you are, is to be part of that stakeholder community and getting that constant feedback. So are things that you find over almost 40 years running a, running a,

00:30:03 Paul Rowan: highly successful hardware company that startups can do today specifically around purpose to give themselves that that edge of a mature product company maybe early on in the game or at least part of that edge.

00:30:15 Paul Rowan: Well, Kevin, I think you've done it too, like by calling your company, you know, make or design. I mean,

00:30:23 Paul Rowan: that's a great example.

00:30:25 Paul Rowan: I should be interviewing you, I think, Kevin, about all your business and design insights rather than me. But I think, yeah, I see a lot of startups. And they hide behind some kind of ambiguous name for their brand when it's actually them. They invented it.

00:30:39 Paul Rowan: I say, like, why do you call it after yourself? I mean, like, you're behind it. You're the personality.

00:30:46 Kevin Mako: Yeah, so making that whole concept more personal about your own, like, personal passion over the idea and like, and just to gather, like, people around you that believe in the same idea. I think that's a really good point.

00:31:01 Kevin Mako: And I just don't like when people. hide behind some ambiguous name like what is this like why don't you just call it after yourself

00:31:08 Kevin Mako: because you're the inventor so yeah that's a really good point i think you know umbra i think the key was

00:31:17 Kevin Mako: that uh we always did all the for example our b our 90% of our marketing effort was through these trade shows you know around the world and there's dozens of them and we went to everyone

00:31:33 Kevin Mako: Europe,

00:31:34 Kevin Mako: Asia, all through North America, pretty well, like, nine months a year, you're on the road visiting people, seeing people. So it was a very personal, you know, effort. There was myself and my partner behind the brand and all the people associated with it.

00:31:48 Kevin Mako: We're always there at the show. A lot of travel, a lot of travel, a lot of relationship building. And, you know, you need that kind of thing, particularly when you have, when you get above the radar,

00:32:01 Kevin Mako: of the competitors and they start seeing what you're doing and they start to mimic you, you need to have those relationships with your customers to be able to fend off the copies

00:32:12 Kevin Mako: and get competitive information from the retailers and everything on what's on the market so far because you can't be everywhere at once. People, if you have these relationships with customers, they'll help you protect your brand.

00:32:26 Kevin Mako: So you need to be out there face-to-face with people.

00:32:29 Kevin Mako: Maybe you can do that on Zoom today, but it's better, I think it was better.

00:32:34 Kevin Mako: There is some value to the trade shows. I hope they do come back when people are able to travel again, because you have that sort of personal connection with customers. That's really invaluable.

00:32:45 Kevin Mako: That's great.

00:32:46 Paul Rowan: I mean, the more information that you can get, especially as you scale at your business,

00:32:52 Paul Rowan: the better. And what better person to tell you than your customers? And in your situation, it was your retailers or distributors, wholesalers, etc.

00:33:01 Paul Rowan: But it, I even think of it from an early startup phase and something that we recommend our clients is call every one of your first couple hundred customers or send them an email at least and really get in touch with those folks because those are the people. And for everyone

00:33:15 Paul Rowan: listening right now to think about how this applies to Paul's story. I mean, look at what he built a massive company off of one product all because that product was good and people started to ask you for more product. And I really want that to sink in.

00:33:29 Paul Rowan: is a main message or one of the main messages of many out of this conversation because I think everybody listening here and understand that the easiest way you're going to get that information is from your customers, the small you are, the easier it is to access your customers and to

00:33:41 Paul Rowan: really build relationships with them. If it is wholesalers, distributors, whatnot, then you may have even few direct customers to you. So take the time to get to know them because when they

00:33:55 Paul Rowan: come up with a key piece of information, you want them to call you first before the other whatever, your competitor or other options that they have or alternative products or whatnot,

00:34:06 Paul Rowan: you want them to get in touch with you. So the easiest way that you can do is just establish that relationship, keep in touch, ask them how they're doing, you know, both from a business

00:34:15 Paul Rowan: and a personal level, really get to know what makes them as individuals and also their business tick. What are those key pain points that they're looking to solve? And that might help you

00:34:25 Paul Rowan: get that one P keys of insight, key insight that helps you develop your next product, which they're already telling you that they want. So like something you also mentioned was a big thing,

00:34:35 Paul Rowan: your customers were almost surefire ways to sell more product. They were telling you what they wanted. So you knew that now you had the ability to take what you had in-house, make the product

00:34:47 Paul Rowan: that they wanted, and you knew that you'd start making sales. Well, yeah, we reverse engineered a lot of products based on the, you know, surveys in the market and working with customers and then we'd

00:34:57 Paul Rowan: go back and develop the product. At the same time, we wouldn't do everything they asked because we thought, yeah,

00:35:04 Paul Rowan: a lot of the staff working in sales and these big retail chains,

00:35:11 Paul Rowan: they know the market inside out. They know they know the sales history of every single product, like top to bottom,

00:35:18 Kevin Mako: but they don't know the future. And like they're depending on us to give them these kind of these ideas that are going to be, you know, highly innovative because nobody really has seen

00:35:27 Kevin Mako: innovation until you show it to them. You know, so these are, you have to have a kind of blend of, you know,

00:35:35 Kevin Mako: incorporating your customers that is with this idea about the future, you know, and, you know, lifestyle, where we're going.

00:35:43 Kevin Mako: And those are the, those are the products that are really going to be, you know, outstanding, right? So, yeah, they're going to be, I think you need this kind of blend. It's just like in a design studio, like you need a blend of, you know, fee-based

00:35:56 Kevin Mako: customers. You need people that are going to give you royalties. You need a kind of balance between things. We always sort of balanced out intuitively how to run the business. Like if, you know, expanding into

00:36:07 Kevin Mako: Europe, you know, when U.S. sales were down with some sort of recession, Europe was up. So we had a chance

00:36:13 Paul Rowan: to sell in Europe and so forth. And it was reversed. We did the opposite. And then with currency fluctuations, you have opportunities to do different things. Also, if you have a diverse product

00:36:24 Paul Rowan: line, you can withstand a lot of the worst case scenarios. Like we were huge in photo frames, for example, and then what happens, you know,

00:36:35 Paul Rowan: the iPhone has all your photos in it right now and nobody's, you know, printing. So what happens to the frame business, right? It really plummets. So luckily, we were in a lot of other different categories to be able to keep the business

00:36:47 Paul Rowan: buoyant. At the same time, we had to think of different ways how people have changed their lifestyle with, you know, printing and so forth. There's a

00:36:55 Paul Rowan: casualization. We gave them things that they could just hang up rather than formalize the framing. We gave them little clips and all kinds of stuff to hang in their in their rooms. And

00:37:05 Paul Rowan: so we responded to, you know, the changing market really quickly. And that was really important too. I think you see there's so many can do so many stories about like, I guess code.

00:37:17 Paul Rowan: the most famous about, you know, not being able to change with technology.

00:37:23 Paul Rowan: And the funny things about Kodak is they actually had a digital camera, but they never pushed it, you know, like they just wanted to preserve their printing business, right?

00:37:33 Paul Rowan: So, yeah, we were lucky that way. Well, and I think that all comes around, you know, you may say luck.

00:37:39 Kevin Mako: I would say it's because coming back to this topic of purpose. So even when you're mentioning the feedback, like we would take a lot of the feedback. We wouldn't necessarily do all of that. Well, that all plays into this. you had this kind of like grand vision that you had for the company that was baked around these

00:37:52 Kevin Mako: principles. Strategic and strategic principles are very like nuts and bolts principles like you went through, but also bigger picture principles like changing the world for the better sustainability,

00:38:03 Kevin Mako: all these other things that you incorporated to really feel good about what you're doing with your life and the business. And those principles then help guide that feedback that you get from those customers. So when you're getting that feedback or as you see these market conditions changing.

00:38:19 Kevin Mako: You can rely on those principles. Your whole team understands what those principles are. As you said, you formalize them. Everybody understood what they are. And when they presented a product, they literally had a checklist that they had to check through to ensure that they were matching the values of Umbra.

00:38:33 Kevin Mako: That's very powerful. The idea is to take away that subjectivity of sitting in a room where people say, I like it, I don't like it, or kind of thing. Like, does it meet our checklist, the criteria of our checklist? One thing we touched on a little

00:38:47 Kevin Mako: bit before as about community. And I have to say that, yeah, I think it was for our 20th anniversary or something. We embarked on this whole outreach to design universities around the world to create

00:39:00 Kevin Mako: these design competitions and collaborations.

00:39:03 Kevin Mako: And that really, I think, changed a lot of our business because, well, first of all, we had a purpose that was outside just profits. It was about, you know, bringing interns into the business and training and

00:39:17 Kevin Mako: developing a new, you know, whole generation of designers,

00:39:22 Paul Rowan: you know, supporting design universities. We actually turned it into a very profitable thing by, you know, commercializing original student work, many of them to the tune of millions of dollars.

00:39:34 Paul Rowan: And we paid royalties to the students to help, you know, fund their careers. And we paid royalties to universities, too, to support their programs. So in the end, what happened was that we brought in young,

00:39:50 Paul Rowan: really the best designers that we recruited through these kind of collaborations.

00:39:55 Paul Rowan: And they ended up, you know, really keeping our business fresh in terms of our design outlook. I'm a huge fan of the University Awards, by the way.

00:40:03 Paul Rowan: And, you know, we've, before our firm could afford it, before we had the time, we, the first award we did, the University Award was Universitywide at Ryerson. Still going on to today, the Macro-Rarison Innovation Award, I just keynoted it last week.

00:40:16 Paul Rowan: And it's an amazing feel-good experience, but it's incredible to see the power of the student innovation that actually comes out of it. And I imagine you saw the same things. Now we're doing it all kinds of colleges and universities, generally on an annual basis.

00:40:30 Kevin Mako: And every year, I'm blown away by what the students are coming up with. The cool thing for us, I always thought was kind of a magnificent part of the innovation award that we did is you didn't have to be in design or engineering or whatever else.

00:40:44 Kevin Mako: It was agnostic across the school. So what we would have is folks coming up with an invention idea in the math department and then working with an engineer and then going to work with a 3D, you know, a kid who's in 3D printing and all of a sudden they come up with this innovation that is world changing.

00:40:58 Kevin Mako: And we've had many product successes come out of that.

00:41:02 Kevin Mako: Unfortunately, we don't economically, we're not tied to them in any way. But it's an amazing experience just to watch student innovation at a very early age, let alone all the intangible benefits, because you know, and we hear stories years later of how

00:41:15 Kevin Mako: that event, or even just watching their friend around that event or some media that they saw spurred them to come up with their own idea years down the road or whatever else, and they started their own business to grow from there. So that community thing, I always knew it would be

00:41:28 Kevin Mako: powerful. I just wasn't sure how. And now obviously that we've done it for many years, I can see just how powerful the compounding effect of those sorts of events and things are over time.

00:41:38 Kevin Mako: And it all comes back to really the core values of Mako Design, which is interesting to see in the broader community beyond just the core services that we offer.

00:41:50 Paul Rowan: Yeah, and to take that a step further, we partnered with like stores like Target in the U.S.

00:41:57 Paul Rowan: And created these end caps of one of them that we did that was huge was designed by students for students for a back-to-school program.

00:42:09 Paul Rowan: And the whole N-CAP was all work from Pratt in Brooklyn and Humber in Toronto, Emily Carr,

00:42:21 Paul Rowan: O-CAD,

00:42:23 Paul Rowan: NASCAR,

00:42:26 Paul Rowan: just to name a few of the contributors. I mean,

00:42:31 Paul Rowan: it was just fabulous. So Target realized that, hey,

00:42:36 Paul Rowan: and they've always been driven by purpose to really, you know, you know,

00:42:42 Paul Rowan: change the impression of a mass merchant to be like a low-cost fashion store, like with innovation and their collaborations with designers and stuff. They've had a very innovative approach in retailing.

00:42:55 Paul Rowan: And so they like the idea of, hey, we're going to buy product that's designed by students. We're going to support students. We're going to pay them royalties.

00:43:05 Paul Rowan: And our customers are going to recognize us for it, that we're doing something really community-based.

00:43:10 Paul Rowan: This is a whole other topic for an entirely another podcast, but it's amazing because now I'm seeing more than ever that the retailers, which as you know, were traditionally almost impossible to get

00:43:21 Paul Rowan: into as a one product company are starting to be more and more accepting of these one skew innovations.

00:43:29 Kevin Mako: And I think a lot of that's obviously driven by online or digital competition, right, whereas these folks are coming and creating massive brands and the retailers miss out on that entire window.

00:43:39 Paul Rowan: So we're now starting to see clients that are actually getting, cracking through the door, which has always been tough. And then, you know, holding their head and saying, look, this is my only product. And you know, traditionally response was come back when you have a line.

00:43:50 Paul Rowan: And nowadays, you're starting to see more and more retailers. And I really hope this trend continues. And I think it will just because of the competitive nature driving online sales and a number of independent brands that are gaining traction.

00:44:01 Paul Rowan: I think all the retailers right now, and I'm actually talking with some that are basically saying, we want to be part of that innovative movement. We feel like we've lost out over the years. And it's programs like what you did there that I think helped show them that there's

00:44:16 Paul Rowan: some real value, financial value to them, but obviously much greater community value that results as well, if they start bringing in more than just their big corporate buyers and think there's other folks here too that are creating great products, we should also think about

00:44:30 Paul Rowan: giving them some access as well. And it can be very mutually beneficial.

00:44:35 Paul Rowan: Well, certainly we talk about how digital tech, you know, marketing has changed a lot of what we do.

00:44:42 Kevin Mako: You know, I really talk about to the designers about, like, you know, everyone always thinks about bricks and mortar as a sort of destination for their product, unless it's an app, of course, right?

00:44:57 Kevin Mako: That's on your phone. But they always think, oh, yeah, we're going to have it in a store. But like, yeah, no, that's not the where, you know, I would say digital sales,

00:45:07 Kevin Mako: product sales are going to surpass bricks and mortar pretty soon if they haven't already, you know, probably in COVID they did.

00:45:14 Kevin Mako: So, you know, how do you design a product so it's effective for digital marketing? Well, first of all, I see a lot of presentations of product and they show me something on a big screen, you know, projected and everything. I say, yeah, don't show it to me on a screen.

00:45:27 Paul Rowan: Show it to me on your phone because that's how. most people are going to be able to do your product. So when you say that to a designer and they've got a sort of ambiguous looking form to it,

00:45:38 Kevin Mako: that sort of blobby with no separation or color or definition, like how does that look on a phone? Okay, sure, maybe it looks great on a store shell,

00:45:47 Paul Rowan: but on a phone where most people are going to be looking at it, it doesn't look like anything.

00:45:51 Kevin Mako: So how can you build more, you know, interest into your product because you know that now the

00:45:57 Paul Rowan: the main marketing, you know, venue is going to be a cell phone.

00:46:03 Paul Rowan: And same with anything branding, too. Like I see a lot of, I work consult on a lot of branding right now. And I say, like, hey, show it to me on a phone where it's like in the corner of your Instagram post. I want to see the logo like that where it's only like, you know, a centimeter across. Don't show.

00:46:18 Paul Rowan: We're going to have to get you back on the show because that's a whole other topic, too. How do we design for mobile sales? Because I think that in itself is a very important topic and a growing topic, right? It's huge. It's huge. It's design.

00:46:29 Paul Rowan: I mean, that's why I say reverse engineer for like where we're going to sell and how we're going to sell it, you know. Right. The last thing I wanted to talk about really was about, you know, if you have a strategy as a startup,

00:46:41 Paul Rowan: you need to be able to design in a lot of the necessary attributes that didn't exist for me before. For example, for example,

00:46:50 Paul Rowan: or, you know,

00:46:53 Paul Rowan: employee working conditions and all that kind of stuff, salaries, whatever, bonuses.

00:46:58 Paul Rowan: anything to do with treating employees. So you realize if you want to treat your employees well and you want to be able to use sustainable materials, you need to have an innovative idea that's going to generate enough margin for you that's distinctive enough to be able to pay these people

00:47:12 Paul Rowan: and to be able to source sustainable materials. Otherwise, you're just a sweatshop. You're working on a product that's generic. It's just price-based. And then there's no bottom to a price once you start fighting it out with China

00:47:26 Paul Rowan: and other countries. So you need to be able to have a product that's going to have enough innovation that you can command a price that's reasonable for the quality that's going to give you enough margins

00:47:38 Paul Rowan: to support your employees and support your sustainable efforts.

00:47:43 Paul Rowan: So this is something that's really important. That's a great way to tie it all together. I appreciate that, Paul. And I think we talk a lot on the show about margins and innovation and making sure that your innovation ensures that you have margins.

00:47:57 Paul Rowan: You never want to be the person who's making it cheaper, but also innovating. If you're going to innovate and make it better, then you should be getting the margins accordingly. And then that allows you to treat your, let's call it the community or this all stakeholders very well.

00:48:10 Paul Rowan: And you should be able to do that if, like you said, you have certain innovation or enough innovation built in that they're going to want yours as opposed to a cheaper, not necessarily even just competitor, but an alternative, right? Which is your two things that they deal with, right?

00:48:24 Paul Rowan: I guess the last warning to people pricing products is don't, you've got to price it so that you're super competitive too, because if you have a great idea and you're overpriced, then the competitors will just come in and do it for a lower price. Or the alternatives, right?

00:48:39 Paul Rowan: If there's an alternative solution, maybe not a competitor, but an alternative, and it's a fraction of your cost, you have to factor that into how you're pricing it as well. Absolutely, yeah. I mean, this is really important decisions when you're starting off. Paul, thanks again for being on the show.

00:48:53 Paul Rowan: a lot, tons of insight today, and we'll look forward to having you back again. I enjoy it, Kevin. Thanks a lot. Thanks. Take care.

00:49:00 Narrator: Thanks for tuning in to this episode of the Product Startup Podcast, the show that teaches you what it really takes to bring your product to market and turn it into a big success.

00:49:11 Narrator: This podcast series is brought to you by Mako Design + Invent, the original and leading firm in North America to provide global caliber in-to-end physical consumer product development

00:49:23 Narrator: to startups, inventors, and small product business clients. If you're looking for product development help on your invention, head over to Mako-design.com.

00:49:32 Narrator: That's m-a-k-o-design.com for a free consultation from one of Mako-designs for design studios from coast to coast. Thanks for listening and see you next time.