On this episode of Honest Ecommerce, we have Preston Rutherford. Preston is the Cofounder of Chubbies Shorts, which had a 9 figure exit, and loop returns, one of the top returns and exchanges platforms on Shopify. We talk about building a positive association with customers, staying true to your brand vision, turning rough returns into smooth solutions, and so much more!
Preston Rutherford is the Cofounder of Chubbies Shorts, which was acquired for 9-figures and is now part Solo Brands, a public company.
He is also the Cofounder of Loop Returns, the top Shopify Returns & Exchanges Platform.
Preston is an expert in Marketing, Growth, Brand, E-commerce, CRO, Data, Acquisition, and Retention. He’s also a dabbler in private equity, enterprise fintech software, and real estate development.
In This Conversation We Discuss:
Resources:
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Preston Rutherford
The goal is to just help people building brands on Shopify and across channels figure out how to not have to make the same mistakes that I made.
Chase Clymer
Welcome to Honest Ecommerce, a podcast dedicated to cutting through the BS and finding actionable advice for online store owners. I'm your host, Chase Clymer. And I believe running a direct-to-consumer brand does not have to be complicated or a guessing game.
On this podcast, we interview founders and experts who are putting in the work and creating real results.
I also share my own insights from running our top Shopify consultancy, Electric Eye. We cut the fluff in favor of facts to help you grow your Ecommerce business.
Let's get on with the show.
Hey everybody, welcome back to another episode of Honest Ecommerce. I'm your host, Chase Clymer.
And today, I'm welcoming to the show an amazing guest, Preston Rutherford. He is one of the co-founders at a small company called Chubbies.
Preston, welcome to the show.
Preston Rutherford
Chase, thank you so much. I'm pumped to be here. Thanks for having me.
Chase Clymer
Oh, I'm excited. We've been trying to get this to happen for a while and we finally get it done the day after Cyber Monday, which sounds crazy to most.
So for the listeners, the ones that absolutely have been living under a rock in the D2C world, what are the types of products that Chubbies was bringing to market?
Preston Rutherford
Oh man. Mostly... I like to talk about it as weekend wear, but mostly tiny shorts for men. Swim trunks, bright prints. But it all got started with some little tiny men's khaki shorts.
Chase Clymer
Absolutely. Let's talk about that first product.
Where does the actual idea for this business come from? Was it a product idea first, or was there actually a more intensive brand first? Where did we go?
Preston Rutherford
Great question. I'd say it was a little bit of both. But yeah, absolutely. The product drove it in that there was a feeling that you can take yourself back to 2011, which is crazy.
I mean, at the time, it was very much the Abercrombie & Fitch vibe. Today, it's different. It’s just like house music, sprinkle it on your face, people with six-packs stand outside the front door of the store, making you feel like you're not cool enough to walk in.
But product-wise, long, many-pocketed cargo shorts, kind of like hiding the legs of the human was sort of the thing.
So at the time, there was like a product gap, where it was just kind of like… I played rugby, two of the other founders played soccer at Sanford. The other one spent a lot of time growing up in the Southeast where shorter shorts are the norm.
We all just loved the retro vibe, the pictures of our dads on spring break, more in the shorter shorts, having a great time. And so there was this, this ethos, this nostalgia that we felt that needed to come back. This fun, this levity.
So to your point, there was both sort of like a big product gap where we felt like we just want this thing and the only way we can get it right now is to either cut our shorts or to go to Goodwill.
And the brand component as well, which was, we just don't like the vibe of where we get our clothes, which is why we get stuff at Goodwill because it's like, I'm not going to go to a place that's super coming off as taking themselves too seriously. I'm not cool enough to shop there. Let's just flip the whole thing on its head. And let's do the opposite thing. Let's just do some tiny shorts and have a lot of fun doing it.
Chase Clymer
Absolutely.
So do you remember where the ideation of, “Hey, let's make our own shorts” came from?
Preston Rutherford
So there were four of us and we all had been working for four or five years at a college. I think we all realized around the same time that we're not really good at working for other people. So a little bit it was for entrepreneurs looking for a company, looking for something to do, and so I'd say that was one point.
The other was none of us studied computer science in college, so none of us were going to create the new social media platform, etc., etc. Whereas if you're like, “One of our friends started Instagram,” “One of our friends started Snapchat.”
I mean, it was kind of just crazy that that stuff was happening. That wasn't in the cards for us. So I was like, okay, well, we could do shorts.
And then outside of that, it was the idea of, “Hey, yeah, we like shorts. We couldn't find it. Let's just try to do it.”
One of us, one of the four founders, Rainer, actually knew how to make clothing. He had actually done that before, so he knew how to go about getting a sample and trying to figure that out.
And Kyle, one of the other co-founders, was in private equity and one of the spaces that he was analyzing was commerce and commerce enablements, so he knew that Shopify was not just getting started, but very, very early and had completely changed the cost, the time, the investment to just get a store up and running online.
So we had both of those things and then Tom and myself, we would just, let's say we’re utility players, obsessed with consumer psychology, trying to make people laugh, things like that. And so the four of us coming together I think made it possible to get something started.
But more than anything it was because we hate working for other people, let's try to start something and there are all these tailwinds on the Shopify front. There's this product gap. Let's just see if there's something fun we can do here.
Chase Clymer
Absolutely.
Now, did you all jump all in or were some people still working a full-time gig and this was a side hustle?
Preston Rutherford
Yeah, no. It was the latter. So for the first... I don't know how long, more than a year, I think, we work nights and weekends. Maybe on the surface, it seems like we're a bunch of dumb idiots but we were pretty risk averse in that we had salaries and we had rent to pay and all this kind of stuff.
So I think we were close to like a $2 million run rate before we said, “Hey, let's actually go all in on this.”
And there were others, not just revenue, but there were other markers where it seemed like, “Okay, there's real traction here. There's a real pull here that 's demanding our full time.”
But no, it was very much nights and weekends. Let's just get this going and see if there's something there.
Chase Clymer
Cool. I want to come back to those markers and just talk about them. Maybe there's some listeners out there now that are needing to understand if it's the right time to finally jump ship and go all in on what they've been building.
But before that, I want to talk about you launching a new product in a new space. How the hell do you get people to pay attention to you? How are you getting people's eyes on your product? How are you getting customers?
Preston Rutherford
So funny. So 2011-ish. So TLDR, we started in person with most of it in San Francisco. We all live in San Francisco. All of our friends lived in San Francisco at the time, and the square card reader, I mean, I feel so old saying this had just become a thing where you could just plug it into your iPhone and swipe a credit card.
Like Venmo, not a thing. PayPal too, you know. That's how you had to take a credit card transaction then.
What was really interesting is we would just wear the product ourselves and then sell it to a few of our friends and we would get some test runs, put the product in our backpacks and go to brunch out in the city.
We would just be doing our thing and people would come up to us either to tell us, “You guys look like a bunch of idiots. I hate you,” Or “What is going on? This is awesome. Where'd you get those shorts? What is this?”
And we give them a little bit of background and let them know that we have some. Then they would be like, “Okay, let me just put them on right now. I'll buy them off of you.”
And so that's sort of how it started, like real in person interactions where we were effectively our customers, and then friends of ours were customers and friends of friends were customers. And it was just one of those things where you got a lot of feedback in person before anything else.
And then that started a little bit of a process of word of mouth or whatever it might be. So that allowed us to kind of get a… you were talking about markers, like, “Is there something here or not?”
And I think all of our previous experiences, we had all had instances where it was like, “Okay, it's not clearly not working, but there's kind of apathy towards what we're doing.” I know I specifically had an experience like that in a previous company.
That was one of my biggest things. I just don't want to create something where people are kind of just like, “Meh.” And when we started to get the polarity of response, especially in an in-person context, it became obvious that there's something that we should at least keep pulling on the thread and see where it goes. And we can only really get that by doing things in person.
Not that I'm telling people today to just do your lemonade stand, but in some ways, try it. See what you can learn there.
And then the second thing was we found that… one of the things that we did was this kind of like college ambassador program where we found out how we can get into communities of people who would be super pumped about this product.
I think that was maybe the second thing, where we just kind of started this college ambassador program where there are people who just couldn't get the product we were making as well. So it was also a little bit of validation, “Hey, there are other people outside of the four of us who are totally crazy and our crazy friends who also seem to have this need. So, okay, seemingly there's something else there as well.”
And then the third thing was, I mean, of course, all these things are so obvious today, but just like UGC. It was way less obvious that you should just take pictures of your friends and put them up on your company Instagram page, but that's all we did. And that's all we did for the whole life of our business, which is just normal people doing normal stuff, having fun, wearing the product rather than the traditional overly produced expensive only hire a certain type of model, do a traditional photo shoot where everyone's just looking really serious, etc.
We made a lot of fun of that over time, very much just posting pictures of friends. And then it made it a lot easier to get those people who were tagged to share it and just get this whole, again, all this stuff is obvious right now, but at the time it was not very obvious, but just getting the ball rolling of people feeling like, “Hey, I love being a part of this, this is cool, this is something special. I don't feel like I'm selling anything to anyone. People are buying into this thing because it's authentic and it's fun.”
All of the things that make it so possible for these things to gain steam, if there's some foundational components there, which it did seem like there were.
Chase Clymer
Absolutely. It's something that I've talked about a few times on this.
It's just like when you have an amazing product, it makes everything else so much easier. And if you get that flywheel started, everything starts to fall into place.
Preston Rutherford
Yeah. And to be clear, thank you for saying it’s an amazing product, it was a very notable product.
We had a lot of room to improve on quality. A lot of people just ripped the seams. There were a lot of things to do to get to having a great product that I think fulfilled the promise that we would make in mind of the consumer or the customer.
But no, I think having a notable product that in some ways did the selling for you, very distinctive. I couldn't say it wasn't of help, it was just one of those things where it was very different from what the norm was at the time.
Now it's far more normal. There are shorterish shorts everywhere, like a five and a half inch in seam or seven inch in seam, which was very short in 2011.
Again, I feel old, but it was just different. So part of it is just like, you kind of look dumb for a while at the beginning, but you feel like what you're doing is the right thing. And as long as you're internally validated enough to not quit while the whole world comes around to the truth that you know.
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Chase Clymer
Now obviously, you guys have had massive success and there were some exits and whatnot.
During that scaling phase, do you remember what the day to day was for you? What was your actual job trying to keep the pieces together and keep things growing?
Preston Rutherford
I mean, it was constantly changing, I would say, but there were a lot of similarities. At the beginning, it was very much Tom and I just trying to figure out, “What are we going to do? What are we going to talk about? Who are we going to be?”
The only leverage we had were product descriptions, product names, product photos. And then we started doing a little bit of Facebook advertising. We were just trying to figure out how do we stand out? How do we look like something that doesn't look like an ad? How do we show people that we're putting so much effort into this and that it's surprising, that they're just like, holy shit, this is fun, this is awesome. Rather than here's a picture of a product and some discount, blah, blah, blah.
So I'd say one of the takeaways is just a lot of effort on things that maybe would be early things to get quote unquote outsourced. We really put an inordinate amount of effort into that. To content. Doing it in-house, owning it, not necessarily having high production value or high production quality because we found out that for us, that was inversely proportional to the actual performance.
But in terms of what we did, it was just really, really working hard and doing the very, very basic things of trying to put things out into the world content-wise, product-wise, that just when people see it, they're like, “This is awesome. I love this. I feel great about this. I'm going to share this with my friends."
And then that permeated throughout everything we did and everything the team did. So for Tom and myself, it was very much to build a brand. Why do people love what we're doing? How do we make people laugh?
But then there's obviously a whole bunch of other stuff that has to happen in the business. Making amazing products, making sure the ops are such to where we're actually able to send people the product and not run out of money.
It's hugely beneficial when you have co-founders there with you who can lift you up when you're down. Push back on you when you're being an idiot, build on nuggets that you're kicking around. I mean, for me, that was like the biggest blessing of this whole thing, getting to work with three of my best friends day in and day out trying to just figure out what the heck we were doing.
But always bringing it back to trying to just brighten our customer's day and our customer being our friends. So it was just like, how do we just make our friends laugh all day every day and then give them amazing products that they love.
So yeah, I mean, in terms of what we did every day, I wouldn't say it’s too different from what anyone else is doing, but I think I’m very fortunate to have great co-founders. Very fortunate to be able to have the support to just go super, super deep on these things that I think really helped differentiate us.
The branding components, the marketing components, the fun components, the content components, I think they ended up building this, you mentioned it earlier, this flywheel, which is getting people to have this positive association, I hope, built up over time.
It's like, “Okay, I know what these people are. I know what they're doing. I like it, or I really don't like it,” and that's okay. Because there's enough people that hopefully will like it.
Chase Clymer
Absolutely.
You mentioned ops and making sure people can get the product that they wanted.
What about returns? Obviously, we need to talk about something that's very unique about the Chubbies story and the Loop story to spoil what we're going to talk about here.
It's pretty interesting to see a direct-to-consumer company build a solution for themselves, and then that solution evolves into a giant SaaS player in the same industries.
How did this happen?
Preston Rutherford
It's so funny. Totally stumbled into it to a point, and you summarized it perfectly.
It's kind of like, I mean, if anyone was operating when the genesis of this kind of came about, let's call it ‘14 ‘15, 2016 returns exchanges, super rough for the customer, for the company, for the team. There was clearly a problem to solve there.
And as it relates to the impact on the company, I think one of the things that was such a bummer when you always saw it happen was, oh my gosh, that could have been an exchange, but it ended up being a return. There's something you can do about that.
And then the amount of time our customer service team was spending just back and forth, “Hey, send me a picture of your product,” I mean, everyone I think gets the problems that existed, but maybe some people don't, if they didn't have to deal with that kind of stuff. It was just rough.
And then from the customer perspective, it was like, “Why don't I have to go through? Why do you want me to send you a picture of the product to make sure I adhere to the return policy?” blah, blah, blah. That was the most important thing: for the customer, it was a really rough experience.
So yeah, I think more than anything, before we started the business, we're really a bunch of nerds and we love technology. We love building software to solve problems, and that's what we did. We did the bunch to solve internal problems that we dealt with in the business.
So this just happened to be another one of those instances, but where the product ended up being externally facing. And it was just enough of, “Hey, this is a problem facing other folks, other brands,” and when they saw the returns experience, it was just kind of like, they came to us saying, “Hey, can we have that? Can we have that thing, that product that you have where you're facilitating this returns and exchanges experience?”
And we were like, “What? I don't know what you're talking about.” This is just something that, you know, one of many things that we just built, and so it kind of organically happened. There was a pull there and it was just a crazy process.
And then ended up spinning up an entity, putting a great team in place to go out and actually pursue this vision, this great opportunity. And it's amazing to see what the team has done.
Very excited to see how the business has grown. I mean, it's been crazy, but yeah, super wild in the way that that transpired.
And I know a lot of operators are like, “Oh, I've had this software idea that I've wanted to get out there,” “Oh, I built this tool for myself.” It's possible. It happened. I don't know if out of a hundred, how many times you could replicate it, but I know that a lot of Ecomm operators out there have felt like they have something they want to make available to other folks.
And I don't know, it's interesting. The thing we struggled with was distraction. Could we handle both a consumer brand and a software business? And we determined that we could not, so we decided to continue to focus 100% on, let's not say 100%, but effectively 100% on Chubbies, on the consumer brand, because we had seen other brands that had kind of tried to do both.
Not to say that's not possible. We just realized we couldn't really do it. So yeah, totally, totally crazy story.
Chase Clymer
Yeah. And I mean, just to highlight some things that resonated with me, is you went into it solving your own problem with no expectations of building a second business.
And then it turned out that other people needed that same problem solved and it grew organically. I think that is maybe the best way that these types of things can happen.
I think founders can get distracted by shiny objects. And if you go at a problem, expecting it to be a $50 million company, you lose sight of the thing that's making you your real money right now. And then you have two potential failures on your hands.
Preston Rutherford
Yeah, totally. It is such an ideal way, but it’s hard to plan around that though, right? But it is something to be open to. And I think we made the right call staying focused because the shining object can be like the worst possible thing and we can make so many mistakes just pursuing shining object syndrome over and over again.
So yeah, you're right. It's sort of lightning in the bottle moment, but the fundamentals of having a problem, understanding it so deeply, not even caring whether or not you'll be able to sell this to other people, just let me solve this problem the way that it needs to be solved so that it solves my problem.
And then whatever's gonna happen is gonna happen.
Chase Clymer
Absolutely.
Now Preston, you've shared so much stuff with us so far.
Is there anything I didn't ask you about that you think would resonate with our audience?
Preston Rutherford
I think one thing is, after having this whole thing, what I'm trying to do now is trying to be helpful to other folks who are building brands because it's hard. We were very fortunate.
And the benefit of being able to build something on Shopify where you can make a product and make people's lives better and bring your vision of what the world should look like to the world so easily is just one of the coolest things ever. It just gets me excited to no end.
So one of the things that I think where I hope I can be helpful is that one of the biggest mistakes we made over a long period of time was not understanding how to allocate our marketing resources to build for these longer term outcomes, which was like actual profit generation.
And I think that's one of the things that's affecting a lot of folks right now because the meta D2C customer acquisition economics are, for a lot of folks, somewhat challenging. And we had to deal with stuff almost a half decade ago because we just... Men's tiny shorts are very kind of like discretionary purchases.
I think that one of the things I'm trying to do is just write about it on LinkedIn. If there's anything I can do to give back outside of this 25 minute conversation that we're having, it would be to write about all the mistakes I made on LinkedIn.
And if you want to read it, great. The goal is to just help people build brands on Shopify and across channels, like figure out how to not have to make the same mistakes that I made.
So to the extent that's helpful, great. Check it out. Would love your feedback. Would love to just try to learn collaboratively because that's the goal. It's not just like dictates.
I think that's the one thing I would just want to mention, that I hope I can actually give back to everyone who's listening to this episode in such a way that I hope is very tactically beneficial to the bottom line.
Chase Clymer
Absolutely. And I'll make sure to link to that in the show notes.
Preston, I can't thank you enough for coming on and I'm sure I'll have you back.
Preston Rutherford
Awesome Chase. Grateful to be here, man. It was super fun. Have a good day. Love what you're doing, man.
Chase Clymer
We can't thank our guests enough for coming on the show and sharing their knowledge and journey with us. We've got a lot to think about and potentially add into our own business. You can find all the links in the show notes.
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Until next time!