During an early morning service appointment at Tempe Power Toyota, I tried my best to stay awake by browsing through the latest Forbes magazine (it wasn’t the best idea since the elderly couple sitting next to me provided more entertainment than the magazine). I came across an article featuring Zazzle, an e-commerce company who specializes in customizable apparel, prints, stamps, et cetera. The Forbes article was a bit anorexic in terms of Zazzle’s business philosophies and history, so I did a Google search and came across a cool podcast from their January 25th ETL presentation at Stanford. The podcast was especially refreshing because I initially thought that Zazzle was just another Cafepress clone, but it turns out that they started with very different business philosophies.

Both Cafepress and Zazzle started in 1999. Cafepress hit the ground running by incorporating 2 months after their inception and using an advertising blitz where they emailed 100 new websites a day, receiving a 20% response rate. They secured Series A venture funding 8 months later, and the rest of Cafepress’s timeline reads like a Michael Jordan resume. Zazzle on the other hand didn’t truly go public until 2003. In stark contrast to Cafepress, Zazzle’s co-founders Bobby and Jeff Beaver (hereafter known as “The Beavs”) never really tried to become popular, it just kind of happened that way. They started off with the hopes creating something meaningful and interesting that individuals and artists could utilize.

The early days consisted of hand delivering products to local customers, toiling away in their 2800 square foot office/warehouse/server room, and trying to figure out a way to apply on-demand manufacturing to customer created apparel. They did everything themselves from cleaning the toilets, to hand delivering local orders, to writing back-end code for the website, to figuring out methods of direct printing technology, so there was never a need for money or funding. They also never had a need to advertising since their website and word of mouth created all the viral marketing they could handle.

Today, Zazzle provides the option for users to use branded content from Family Guy, Star Wars, Coca Cola, Disney, and even image files from the Library of Congress. In addition, the community that they’ve created actually rewards creativity by allowing artists and individuals to collect royalties if their artwork and designs are purchased or used by another artist. I’m still not sure what the quality of the final product is, but the Beavs made it a point to directly ask customers how they could improve their products (this was during local deliveries). In 2004, they were approached by a venture capitalist and after weighing the pros and cons of VC, they decided to seriously look into it and joined with Kleiner Perkins for $16 Million in funding (keep in mind that they were already profitable). The company is still private, and the Beavs have been cautious with the challenge of scaling production and their team while still maintaining the founding philosophies.

Needless to say, Zazzle’s co-founders definitely made quite an impression on me so I decided to compile their ‘lessons learned’ from the podcast for all 13+ closetblog readers to enjoy! Although I would strongly suggest listening to the podcast when you get a chance; it’s really interesting and informative!

Zazzle’s Lessons Learned

1.) “You must have a passion. Starting a business can be really tough and sometimes all you have to fall back on is your vision, your passion, and the people you work with.”
I’ve heard this time and time again from successful business owners, and it really seems to serve as a means of inspiration when the going gets tough. In the Beavs case, their vision was to champion and foster creativity around the world by empowering millions of artists who didn’t have readily available means of expressing themselves. They talk about the fact that they gave up their social lives, everyone around them was skeptical of their ideas, and there were numerous setbacks with the website and printing technology, yet they persevered through it all by relying on their passion (and an addiction to Red Bull and Rockstar energy drinks).

2.) “Its amazing how much can be accomplished by a small group of people.”
In Zazzle’s case, they began small (4 or 5 people I believe) and stayed small; and all the founding fathers shared the same vision and passion for what they were creating. Even after securing funding from Kleiner Perkins and deciding to scale the company, the Beavs are still struggling to ensure that their vision and passion is not lost in the process. Case in point, it took 2 months to hire their first engineer since they wanted someone who shared the same vision and passion, and was the correct technical fit. Currently, 40% of the Beavs’s time is spent on recruiting and hiring.

3.) “Have confidence in yourself and your team to get something done, don’t be intimidated by what you don’t know.”
In the podcast, the Beavs mention that Hanes invested $50 million in R&D to find a method of direct printing onto a cotton substrate, and “got nowhere” (I didn’t research the validity of the statement, I’m just quoting what they said). Regardless, they made use of their network of friends, family, professors, and advisors when they encountered unfamiliar issues. And it’s probably not a bad network considering that the Beavs graduated from Stanford (both received a Bachelor of Arts degree in Economics). Their father had started several businesses himself and had a business acquaintance that helped with the direct printing research.

4.) “Question everything. Do not accept the status quo, ask about everything and understand why and how people do things. Do not be afraid to do something different.”
The Beavs mention that when they studied the apparel market, they found that the methods used for creating prints on t-shirts were a bit antiquated and expensive (good old fashioned silk-screening) so they tried to come up with something suited towards on-demand manufacturing. At the end of the podcast, they also mention how their initial efforts at direct printing were unsuccessful, but they continued researching ink chemistries to develop dyes that could get through the printing nozzle heads without clogging them up. They even figured out the tricky process of printing on black fabrics, which Cafepress also had a difficult time with.

5.) “Adapt or die. The business and manufacturing landscape changes all the time and there is a need to account for that by making the most of opportunities.”
I touched on this earlier; their father was a serial entrepreneur who had a wealth of experience in starting up a company. According to the Beavs, they took their father’s old school rules of focusing on margins and what you’re selling, and adapted them to the new and fast paced world of e-commerce (as a side note, they aimed for a combination of eBay’s buying community and Dell’s on-demand manufacturing). Even when it came to the user experience on their website, they began using AJAX. They mentioned that users now design their apparel as if they were working on Photoshop, instead of the obligatory step-by-step online wizard.

6.) “People are more important than anything else.”
At the end of the podcast, the Beavs mention a few things like:
– The focus of the company is the people.
– Be a missionary not a mercenary; making money has no place at Zazzle.
– Give empowerment, ownership, and trust in your team.
– You’ve got to infuse fun in what you’re doing and ensure people are enjoying the ride.

So for all intent and purposes, it really seems like Zazzle is completely focused on the culture and what they’re trying to propagate. As I mentioned before, in the beginning they used to hand deliver orders to local residents in the hopes of getting direct feedback from their customers as to how they could make things better and higher in quality. As far as hiring goes, they’ve turned away many qualified people who weren’t excited in the vision of the company.

All in all, I really like what the Beavs and Zazzle stand for. Again I have yet to try out the Zazzle, but will most likely try it out before I try out Cafepress since I feel that Zazzle and I see eye to eye on many things. Maybe some Closet Entrepreneur t-shirts may be in order for those who braved this garrulous post and read this far?

Sincerely,
The Closet Entrepreneur

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