Josh Udashkin went to college, law school and business school in Canada, and he was able to emerge with no student loans at all. Higher education in Canada is much less expensive than it is in the United States, so his summer jobs as a legal associate and other gigs, as well as some help from his parents, provided him with what he needed to pay tuition and get by.
When he moved to the U.S. to work as a lawyer and then to launch his luggage startup Raden, Udashkin realized just how lucky he was. He couldn't believe how much debt American grads haul around.
Now, as a CEO, he's in a position to help.
Udashkin has started offering to match the student loan payments of his employees. The goal, says the 33-year-old, is to help young employees get out of debt faster. That way, he hopes, they will be more likely to go off and become entrepreneurs on their own right.
"I have never really been able to understand how my generation and generations below mine are going to be able to start businesses if they already start their lives encumbered by other liabilities," says Udashkin. "And those are liabilities that previous generations didn't have."
As of September, 2016, outstanding student loans in the U.S. totaled $1.28 trillion, according to a report from the New York Federal Reserve Bank of New York, which tracks consumer debt. That's a five-fold increase since 2004, when the total was $0.26 trillion.
"I just always marveled at this idea that if entrepreneurship of every economy, but especially the U.S. economy, how are we incentivizing young people to start businesses, let alone buy homes or start families or anything else, when they start their lives so deeply in debt," says Udashkin.
Udashkin got the idea for his start-up when, after a brief and largely unsatisfying stint as a lawyer in New York, he worked for a couple of years as an international director for ALDO Shoes. The job had him on the road almost non-stop.
As he traveled, he started to notice how clunky most luggage is. "I was wondering why the product was so unstreamlined, so not beautiful, so poorly industrially designed, so expensive in some cases, and it just kind of opened my eyes to an ugly business category that I don't think anybody young had really taken a look at," says Udashkin.
"I knew I kind of wanted to be an entrepreneur and I knew that by the time I was 30 I was going to try to be self-employed, but I felt like almost every other category felt completely saturated."
On nights and weekends, Udashkin studied the luggage industry, making phone calls and attending trade shows. He observed that the luggage industry was dominated by older white men. He knew he could do it differently.
Udashkin saved money so that he could self-fund his first round of suitcase prototypes. He hired designers who had worked at luggage brand Tumi and headphone set Beats on a contract basis.
The brand officially launched in April 2016, selling on Raden.com and Amazon. The next-generation suitcase, which has a phone charger and built in scale and retails for $295 to $395 each, has been a runaway success.
The suitcase made Oprah's favorite things list for the holiday season and currently has a waitlist 10,000 deep. In a matter of months, Udashkin has built a team of 21 in New York City and Hong Kong; he expects to pull in $12 million in revenue in his first full year. Today, Raden items can be purchased at Net-A-Porter, Bloomingdale's, Selfridge's, and Holt Renfrew.
In June, Udashkin started the loan matching program. Currently, he has three employees taking advantage of the offer.
If an employee confirms that she pays $300 a month in student loans, Udashkin contributes an additional $300. The worker must then also demonstrate that all $600 is going towards paying down her loans.
"Our goal is really around getting to zero," says Udashkin, so as to help others feel "as free as I was ... to take a risk."
He credits his own freedom, as well as "a belief in entrepreneurship," for his sensitivity to the plight of his workers.
The student loan matching program is still new, and Udashkin is experimenting with the pilot. He doesn't even offer a retirement package yet, although that's coming soon, he says. But he thinks the idea that a retirement package is expected but a student loan matching program is novel is illogical. He thinks the goal should be to be debt free.
"If you are at zero and don't owe anybody anything, you are free to make choices about whether you want to save for retirement or start a company," says Udashkin.
Raden isn't an especially fancy start-up when it comes to perks. The team works out of a basic coworking space. "We don't really have many other frills or benefits," says Udashkin. And the student loan repayment program is still pretty small so far.
But Udashkin says he believes in it so deeply that if it needs to come off the top of his own paycheck, he's okay with that.
Currently, the student loan matching program costs less than $1000 a month. "Some companies spend more than that on Ubers," Udashkin says.
The CEO's idea is resonating both with the young employees who benefit and with the Bay Area venture capital set.
"We have some Silicon Valley investors and I think people in the Valley are very interested in motivational tools and I think they are very interested in young workers and engineers and so I don't get any pushback at all," says Udashkin.
He adds, "Raden is not a place to work if you want a free vacation, but it may be a place to work if you want to start your own company one day because you don't own anybody anything."