Whoever doubted that a line of first-aid products in chic patterns and bold colors would instantly hit Editor's Pick lists and become a top giftable for the holidays doesn't understand Eric Ryan's ability to reinvigorate a simple, everyday consumer need and transform it into a lifestyle accessory.
The first-aid kits come in brightly colored reusable, stackable tins and were created to "get you back in the game with a bit of style." The products echo Welly's philosophy that bruises and scratches are the results of the "give-it-a-tryers" who need to be prepared for a life fully lived.
The co-founder of Method, the eco-friendly household and personal-care brand; and Olly, the gummy vitamins and supplements line — launched Welly in April with Doug Stukenborg, a former retail merchandising executive. His goal: to disrupt the first-aid sector, which hasn't seen much innovation in decades.
Today Ryan's three ventures have reached a collective valuation of more than $1 billion, he said.
What is Ryan's secret? "Most entrepreneurs start with an idea, and I start with a category," says the San Francisco-based serial entrepreneur. "I try to figure out what is the cultural shift that the category is missing, and then I just connect the space in between the category and this cultural shift."
Another major thing that sets Ryan apart from other entrepreneurs is that he enthusiastically embraces brick-and-mortar retailers as his main selling channel. Welly is currently sold exclusively in Target stores and online. After the first year, Welly will expand its online distribution and branch out to other retailers. But Target stores will continue to exclusively offer Welly's newest products. This is the same strategy Ryan used with Method in 2002 and later, in 2016, with Olly.
Ryan said he owes much of his strategy to his days as an account manager in the advertising industry. "What I learned in advertising that I carried forward was the importance of creativity and design to create emotional connections."
In an interview with CNBC, Eric Ryan reveals his secrets to being a mega-successful serial entrepreneur and how he juggles his work as the single dad of three adolescents.
With each of your product lines, you targeted a niche and transformed it into something playful and unique. How do you come up with your ideas?
I came out of an advertising background, so I look at everything through a consumer branding creative lens, and that's really what differentiates me as an entrepreneur. At Method it was back in the turn of the century in 2000. America was waking up to lifestyling of their homes, and nobody was really thinking of these products as an extension of their home design. Also, you polluted when you cleaned, and you're supposed to be making your home healthier, and nobody was thinking of these products as also an expression of sustainability and health and wellness, so design and sustainability were the two big culture shifts, or macro trends, that Method today is still driving its growth from.
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What were the cultural shifts that you identified to create Olly and Welly?
Olly was very much the idea that every generation has a different relationship to health. Millennials are now entering the nutrition category, and their relationship to health is making it a much bigger part of their lifestyle. So the big idea was, like, 'OK, what if we treat these products much more as a lifestyle product for millennials?'
For Welly it was the idea that injury is actually a trophy of a well-lived life. These products were always thought about as very much from a hospital to your home and very clinical. What if we designed it in a way that was much more about the accessory of life on the go and putting yourself out there. Bravery is really kind of our platform that we are building from.
Olly and Method are both based in San Francisco. Why did you decide to base Welly in Minneapolis?
I did that for a couple reasons. San Francisco has just become so expensive for start-ups. In Minnesota there's just not a lot of start-ups and everybody that I've hired has said, "Oh, my gosh, there's just not many opportunities like this in Minnesota.' So I love the fact that there's a lot of amazing talent there, and it's just much cheaper to operate.
There's also a really growing health-care scene, with Mayo Clinic. And I'm there all the time because of Target. Its a 3-hour and 15-minute flight from San Francisco. I like the idea that there is a little geography space, where I wouldn't feel the pressure to run down the street and help them over at Welly. So it's really about empowering them.
Does it get easier each time you launch a company?
Second time around, third time around, after having success it's a million times easier. But within that comes risk. Your first venture, you're unknown and you get so beat up when you are raising capital. And that's really healthy, because everybody's challenging you and that forces you to make your ideas better and better.
But when I went to raise capital for Olly, it was so easy that it freaked me out because I knew I was insecure about this idea. I knew there was a lot of risk. But people are just assuming that because of Method that, 'Oh, this will work.' And I wasn't being challenged along the way, and that really scared me to not rest on my laurels. I would have to force people to articulate to tell me why you think this will not fail, and they'd say, 'No, you've got this. You know what you are doing.' And I was like, 'No, this is hard — some of the categories are hard.' I think I really took that to heart, to be careful not to allow the track record in how easy things were getting, that ultimately it could lead to a colossal failure on the next one.
How are sales going for Welly so far?
This is our pilot year, where we are really launching and learning. We launched right around Easter time and our Easter sales were insane. And we realized people were putting them in their Easter baskets. The rainbows and unicorns just naturally had an Easter-time palette to it. We think it's very very giftable, so we are hoping to see a lot of them in stockings this year. It's so fun when you take something that is a necessity and you go from a need into a want. It's the ultimate sign of elevating a category.
You are a single dad with three young kids, ages 9, 11 and 14. How are you able to balance everything?
I have a crazy life, because I'm a very hands-on, dedicated father. Taking a domestic role as a dad helps me get ideas and spot opportunities. I think the biggest thing is, I've become much more excited about creating other entrepreneurs than doing it myself, and that's a little of what I did with Welly — where I created the concept and then pulled together the team and the capital and really empowered them to execute it and be successful. It's a much more sustainable model when you're focused on your family and you are looking to also scale at the same time.
Start-ups are such a grind, and I don't have the family space to do that anymore. So I have a greater appreciation of empowering other people to scale so I can focus on my family and still have an impact.
How did you get the entrepreneurial bug, and do you think your kids will follow in your footsteps?
They love coming to work. In the '50s my great-grandfather and my grandfather started automotive — basically, they are called machinist stamping companies — in Detroit. As a kid, I loved going to work with my dad, and I can see the same thing when my kids walk in. They just feel this sense of, like, it's the family identity, and they feel such a connection to the brands and the products. They got so mad at me when we sold Method. And then we sold Olly. They said, 'You're selling our childhood.' (He laughs)
We talk about it [ideas for products] around the dinner table all the time; it's very much a family business. We just launched kids [multivitamin] gummy worms, and that came from my youngest son, Anders. That was his idea. It's selling great, and it is just a very simple idea.
What advice would you offer other budding entrepreneurs?
I always tell entrepreneurs to focus on the second swing of the bat, not the first. And in the beginning, you are not trying to win; you are just trying to learn how to win. And that's part of breaking it down to bite-size little steps. I'm working with Unilever right now on launching Olly in Asia, and I see that these big companies have such big resources and pressure to succeed right out of the gate. As an entrepreneur, if you are doing something that hasn't been done before, your learning curve is going to be steep, so you have to build into your business approach that the first work you do is really about learning and breaking it into three phases: creating the concept; piloting, which is launch and learn; and then scale.
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In each of those phases, just keep it really focused on what you need to learn at that phase — and proving it before going to the next. What you are seeing right now with the struggles at WeWork and Uber and so many of these large start-ups is they went to scale before they really understood their business model.