Each week on the StartupCamp Podcast we bring you incredible stories of founders and angel investors. The goal is to give you insider tips and tricks on how to build your business or become a successful angel investor.
This is the summary of our most recent podcast where we spoke with foundering and entrepreneur, Tim Morse. We spoke about his incredible journey and his one-in-a-million exit story.
Here’s the interesting thing about Tim’s company, RicherPoorer…
He successfully sold the company in 2015. It was a textbook exit — acquired, partnered, ready to scale, done.
But then, through a strange turn of events, Tim ended up buying back his own company a year later for pennies on the dollar. And today, the business has never been better.
You are going to love this conversation. Let’s get started.
Tim Morse’s Background
Tim Morse was born and raised in Laguna Beach, California. He grew up surrounded by surfing culture, bumping elbows with people who would go on to create famous street-wear brands.
During his high school years, he watched apparel brands like Stussy, Gotcha, and later, Volcom, take over the surf scene and contribute to the culture he loved.
During this period the branding part of his brain really came online.
The spark went off for Tim when he noticed that these companies built their brands on something real — something that was changing in society. His favorite brands connected with the rebelliousness of youth and surf culture. These clothing companies weren’t just businesses, they were part of a movement.
This thinking followed him into his college days. During the summer he worked at Gotcha, an apparel company where he met his mentor Dave Gilovich, Brand Director at Surfline.
By then knew his passion was in apparel, but still didn’t know in what regard or to what extent.
Working in Silicon Valley
Fast forward to when Tim graduated from college. Life took a different turn, and he found himself working in Silicon Valley.
He discovered an interesting connection between the blossoming Bay Area tech culture of the late 90s and the familiar surf culture of his youth.
There was a rebelliousness and thriftiness that defined those engineers and founders. They dared to challenge the possibilities and conventions of tech and business.
Tim looked up to figures like Sergey Brin and Larry Page, who at the time were still tinkering with server setups. Back then, those two were still sleeping on data-center floors. They were chasing their dreams and struggling to get by — just like the fashion entrepreneurs of Tim’s college days.
(In case you don’t know, Sergey and Larry would go on to build a little company called Google.)
And so, this strange relationship revealed itself. Laguna Beach and Silicon Valley. Volcom and Google. Surfers and Engineers.
Over the next ten years, Tim saw the Bay Area culture shift from people wearing suits to green-haired engineers showing up in jeans and t-shirts.
Counterculture had invaded the tech capital of the world. Tim, being both a student of fashion and a Silicon Valley techy, found his finger right on the pulse.
The first concrete opportunity presented itself to Tim through his own fashion choices.
He would always search for unique socks that added to his outfit. He realized that there wasn’t much on the market that fit his needs.
J.Crew and The Gap could satisfy his taste occasionally, but there wasn’t a single company on the market that focused on unique, stylish socks.
He found a white-space in the market.
So, he combined his tech and marketing experience with his passion for clothing and founded the company, RicherPoorer.
Think about this for a second, RicherPoorer started off nipping at the heels of the financial crisis of 2007-2008.
At this moment in time, people were moving away from bedazzled jeans and Hummer SUVs — away from excess.
While Tim wanted to offer something unique, he also wanted to bring things “back to the basics”.
The big idea was, what if you could upgrade an outfit with a $12 dollar pair of socks instead of a $150 pair of jeans?
The timing was just right. Tim was ahead of the curve on the huge sock trend that would surge over the coming years.
Tim and his business partner, Iva Pawling, were making strides with RicherPoorer. He was the ideas guy and she was the business gal.
They honed in on the wholesale channel, establishing a visceral connection with consumers.
They went to trade shows, made partnerships with retailers, and hustled their way towards success.
Time to Expand
Soon, it came time to scale the company.
RicherPoorer had started with only men’s socks but decided to venture into other items. They added women’s socks and men’s boxer briefs.
Tim and Iva knew that male shoppers like to buy socks and boxers from the same company, and he took this as a chance to upsell from one item to the other.
Short-term, the additions didn’t pay off as they had expected.
Then, as time went by and they added t-shirts to the lineup, sales took off. Once the trifecta of socks, underwear, and t-shirts had aligned, customers gobbled them up in bundles.
This was the birth of the new vision for RicherPoorer that would take them to new heights — “to own your top drawer.”
Exit and Buy Back
In 2015 Tim and Iva sold RicherPoorer to Shoes.com.
At the time, they were in the market for a partner that could help them scale. RicherPoorer needed some help with digital marketing and could use a wider consumer base.
Shoes.com’s marketing reached over eight million customers each day. Tim sold socks, they sold shoes. It seemed to be the perfect fit — no pun intended.
Shortly after a clean acquisition, Shoes.com began a rapid decline into bankruptcy. Just in time, Tim and Iva negotiated a sinking-ship deal in which they purchased RicherPoorer for pennies on the dollar and took some board members with them.
In a million-dollar game of musical chairs, Tim found himself planted in the seat he started in.
In the end, they learned that the grass isn’t always greener. Tim and Iva had thought there was someone else who could better run RicherPoorer. Someone with a silver bullet who could take things to the next level.
They had been the best team for the job all along
Post Buy-Back and Future
Now an established wholesale and Direct to Consumer business with a decade of success in the industry, Tim still has his sights set high.
The current RicherPoorer roadmap is to continue to make great products and listen to and inspire customers.
Tim’s perspective is that brands shouldn’t push what they like onto consumers, but rather listen to the data, see what consumers want, and then create those products in your own light.
This will keep customers coming back for more.
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