Why This 'Trep Will Start School in 2014 Entrepreneur caught up with its past 'Treps of the Year, Emerging Entrepreneur Jason Lucash, about how the year has changed him and how it's prepared him for 2014.
Opinions expressed by Entrepreneur contributors are their own.
It's been a transformational year for Jason Lucash. He and Mike Syzmcak, co-founders of OrigAudio, a four-year-old Costa Mesa-Calif.-based products maker, discovered the challenges of selling through major retailers. The two decided to steer their company away from retail sales and focus more on business-to-business. Today, about 75 percent of OrigAudio's revenue comes from companies (including Google and Los Angeles Lakers) that buy customized gifts for their employees, customers or fans.
The shift meant turning down business from Bed, Bath and Beyond and will likely mean a $1 million decline in annual revenue—from $3.75 million in 2012 to $2.75 million in 2013. "It was a tough year," for us, he says, "mostly because we're making that big shift of turning away big-box retailers."
Entrepreneur recently spoke with Lucash, age 30, about his professional and personal lessons and goals for the coming months, how he plans to achieve them.
What lessons did he learn from the past year? OrigAudio lost a lot of money after a large shipment of its popular Rock-It portable vibration speakers meant to be sold for the Christmas 2012 season didn't arrive until early February due to a port strike in Los Angeles. "We got stuck with 35,000 Rock-Its that we weren't able to sell," Lucash says, so they ended up giving them away free to customers. That experience, along with the other headaches of selling through retail channels—such as long payment terms, returned inventory, chargebacks and advertising fees—convinced him and Syzmcak they should focus on B2B sales. "A big-box retailer like Bed Bath and Beyond is going 90 to net 100 days to pay you," he says. "Instead of focusing all the time and effort on all that BS, we look at the B2B sector, where you pitch it, you send it. They're paying us in five days." OrigAudio uses a network of 7,000 distributors across the U.S. that specialize in selling promotional products to businesses. It's now one of the fastest-growing promotional products makers in the U.S. "We did so well because our stuff is so different … and has the wow factor," he says. "Custom headphones are probably more interesting than getting a pen, a mug or a T-shirt."
How does he plan to take OrigAudio to the next level in 2014? OrigAudio's Rock-It had become the company's signature product. However, the company plans to focus more on the mass customization of many types of products—not just audio products—that employers or celebrities might want to put a logo on, whether iPhone cases or T-Shirts. "We're trying to be the go-to spot for customized products," Lucash says. "Mass customization is the wave of the future. If you're not drinking that Kool-Aid yet, you should drink it." Beyond putting custom logos on products, as OrigAudio does, more companies in the future will be making products for customers on the spot using 3D printers. The advantage for those companies, Lucash says, is they won't have to keep warehouses full of inventory. This past summer, the company launched its OrigAudio Marketplace, an online store where fans can buy headphones custom-designed by celebrities or athletes—including motocross racer Jeremy Stenberg or hip-hop group Latryx. "We're able to print and ship them on demand," he says.
What's his biggest professional goal? In spring 2014, Lucash and his Syzmcak plan to launch a new company focus on the customization of travel-related gear. While won't disclose too many details about the new venture, he says the company will combine his personal love of travel with what he's learned about the power of product customization.
Any personal goals for the new year? Since being featured as Entrepreneur's Emerging Entrepreneur of 2012 and gaining recognition as a successful businessman, Lucash has been asked to give many speeches around the world. He's learned a lot about growing a successful company, and hopes to share his experiences by teaching at a college. In 2014, he plans to pursue a Master's degree in entrepreneurship by taking online courses through the University of Florida. Pursuing a degree will hopefully provide the accreditation he needs to teach college-level courses, plus the knowledge on entrepreneurship principles and experiences beyond what he's learned firsthand. He adds: "I don't want to go the MBA route. I'd rather be more focused in what I really want to do, which is entrepreneurship."
