Jake Nickell: “Take Money Carefully”

Never Be Comfortable: It’s funny, I look back at some of our most successful years and see them as years that led to some of our least successful years. And during some of our most difficult years, we did the hard work that resulted in some of our best years. When you’re on top, you […]

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Never Be Comfortable: It’s funny, I look back at some of our most successful years and see them as years that led to some of our least successful years. And during some of our most difficult years, we did the hard work that resulted in some of our best years. When you’re on top, you need to work even harder. Clayton Christensen’s book The Innovator’s Dilemma keeps me on my toes to this point.

As a part of our series about entrepreneurs who transformed something they did for fun into a full-time career, I had the pleasure of interviewing Jake Nickell, the Founder, CEO and fearless entrepreneurial leader behind Threadless.

Driven by a passion for learning new things — whether it’s how to create awesome t-shirts or how to continuously evolve a successful e-commerce site — Jake’s main focus is running the global, hugely successful business that Threadless is today. A creative and unconventional thinker, he constantly keeps Threadless one step ahead by encouraging out-of-the-box ideas and challenging the “business” side of running a business. Jake maintains his geek cred through a love for programming. When he’s not working, he’s busy hanging out with his wife Shondi, daughter Arli, and son Dash.

Thank you so much for doing this with us! Can you tell us a bit about your “childhood backstory”?

I grew up on various army bases most of my childhood. It involved a lot of moving around and making new friends. Sometimes I would reinvent myself for a fresh start when I moved to a new place. Our family got our first computer when I was 12, and by the time I was 14, I got my first job as a web developer at our town’s dial-up Internet Service Provider, where I would build websites for small businesses like our local plumber. In my free time during high school I became a graffiti artist, mostly painting under bridges in the woods.

What was the catalyst from transforming your hobby or something you love into a business? Can you share the story of your “ah ha” moment with us?

For college, I went to a small art school where I studied Multimedia & Web Design. Outside of school I had a part-time job as a web developer building ecommerce websites for clients. In the little spare time I had, I mostly spent it on an online forum for digital artists called Dreamless. The art in the forum was created digitally, so there was no physical representation of it. I thought it’d be fun to start printing some of my favorite pieces on posters and t-shirts, so I built a little ecommerce site to sell those things. It took a good four years before the project grew to the point that I was able to drop out of school, quit my job, and start focusing on the project full time. The catalyst was simply looking at our sales after four years in and realizing I was finally making enough money to start paying myself a salary.

There are no shortage of good ideas out there, but people seem to struggle in taking a good idea and translating it into an actual business. How did you overcome this challenge?

I wasn’t really thinking of Threadless ever becoming a business in the first place. It was purely a hobby, and I would have continued doing it whether it made money or not. This put very little pressure on my project to perform financially, but there was a lot of social pressure that I put on myself to make it happen. I promised this community of hundreds of artists that I was going to do this thing, and felt like I had to follow through on it. The project was bootstrapped with just 1,000 dollars and for the first two years, I didn’t take a penny in salary and just used our sales to make more products. Our expenses were very low, and it was quite easy to keep the project afloat financially because of this. The concept had the room to grow slowly and steadily without much risk.

What advice would you give someone who has a hobby or pastime that they absolutely love but is reluctant to do it for a living?

The best advice I can give is you can never over-promote yourself. Many creative people don’t like to share or boast about their work, and if they do, they do so very infrequently. Getting comfortable with shouting about the things you do is very important if you want your hobby to become your living.

It’s said that the quickest way to take the fun out of doing something is to do it for a living. How do you keep from changing something you love into something you dread? How do you keep it fresh and enjoyable?

For me personally, I stay energized by staying focused on our purpose. Threadless is all about helping artists to monetize their work. If I saw what we do as just selling t-shirts all day, I would’ve been bored of it long ago. But I like to approach everything we do through the lens of how it helps our artist community, which I find incredibly inspiring. I also really enjoy keeping on top of the technology side of our business. I still commit code to our website regularly and stay ahead of the new printing and manufacturing techniques for our product. Recently, our industry has started to move more and more digital with new make-on-demand manufacturing capabilities, and that has kept me on my toes.

What is it that you enjoy most about running your own business? What are the downsides of running your own business? Can you share what you did to overcome these drawbacks?

The most difficult part is the huge amount of responsibility that rests on your shoulders for all of the people you work with. For us, that’s our employees, partners, artist community, customers, etc. I feel a strong responsibility to do right by all of them, and when things go wrong, that can be very painful. The positive side of that is the autonomy in decision making, the constant learning/growing, and working toward a vision and strategy that gives me purpose. I have many techniques for dealing with stress like a solid work-life balance, spending a lot of time outside, snowboarding, long baths, etc.

Can you share what was the most striking difference between your actual job and how you thought the job would be?

Definitely all the “management” tasks. I am very much a maker, not a manager, so learning how to properly manage a team has had its challenges. Finding the right team to help me offset my weaknesses in this area took some time!

Has there ever been a moment when you thought to yourself “I can’t take it anymore, I’m going to get a “real” job? If so, how did you overcome it?

Yes. In 2008 I actually hired a CEO, moved to another city, and set up a satellite office there. I still worked at the company, but I took on a new role. By 2011, I came back as CEO and felt a lot more confident after that break. There was a lot of frustration at the time in not being able to actually make things due to how much management I had to do, but watching someone else do it, and the seeing the way the team could be restructured to accommodate that, helped a lot in gathering back that courage.

Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?

We racked up hundreds of thousands of dollars in FedEx bills due to a simple mistake that would’ve been discovered if I would’ve just opened up our mail. It nearly put us out of business. Luckily, we were able to negotiate a payment plan, get some of the processing fees waived, and dig ourselves out of the situation. The lesson learned was that I really needed some help on the legal/accounting/HR/admin side of the business. That’s when my wife joined the company, and she’s been instrumental in keeping us organized all these years.

Who has inspired or continues to inspire you to be a great leader? Why?

Seth Godin. I love all his thoughts on marketing. They mostly boil down to the concept that the best marketing is a great product, and I really connect with that. I also like his thoughts on people and teams. So many great insights.

How have you used your success to make the world a better place?

I’ve watched too much of HBO’s Silicon Valley to not chuckle at the sentiment, but I do really believe that what we do contributes to a better world. The essence of Threadless was born from my teenage angst of despising corporate mall brands selling their logos on t-shirts. I always wore music tees and “art” tees didn’t exist when I was growing up. I believe most entrepreneurs are troublemakers who see something in the world that they don’t like and want to change.

What are your “5 Things I Wish Someone Told Me Before I Started” and why? (Please share a story or example for each.)

Honestly, I’m glad I was as ignorant as I was when I started. If I knew how hard this would all be when I started, I probably never would’ve taken the first step. And if I knew the “right” way to run a business, I probably wouldn’t have done it in all the weird, unique ways that made us special. But here are a few anyway:

  1. Create a Shareholders’ Agreement: The last thing I was thinking about when starting our company was what happens if it fails or if you and your co-founder split up. It would have been great to have this worked out in advance rather than have it turn into an issue down the line.
  2. Leverage Your Assets: When Threadless started to be successful, we started dozens of other companies, thinking that we could replicate that. We started a Threadless for music, food, patterns, etc. All of these failed, and it’s a momentous task to start a brand from scratch. I feel they would have been much more successful if we started them under the Threadless brand umbrella.
  3. Take Money Carefully: If you can bootstrap, bootstrap. Taking other people’s money comes with a whole lot of strings attached, and you should be very careful about it if you decide to do so.
  4. Never Be Comfortable: It’s funny, I look back at some of our most successful years and see them as years that led to some of our least successful years. And during some of our most difficult years, we did the hard work that resulted in some of our best years. When you’re on top, you need to work even harder. Clayton Christensen’s book The Innovator’s Dilemma keeps me on my toes to this point.
  5. Don’t Listen to “Experts”: Trust yourself. We took ourselves a little too seriously for a while when a lot of academic types started to look at our business and classify it with words like “Crowdsourcing” and “User Innovation.” This was very flattering and we learned a lot more about our own business through the process, but it was important for us to remain true to ourselves. We don’t Crowdsource, we make cool things with our friends.

What person wouldn’t want to work doing something they absolutely love. You are an incredible inspiration to a great many people. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger.

This quote comes to mind:

“I must study Politics and War that my sons may have liberty to study Mathematics and Philosophy. My sons ought to study Mathematics and Philosophy, Geography, natural History, Naval Architecture, navigation, Commerce, and Agriculture, in order to give their Children a right to study Painting, Poetry, Music, Architecture, Statuary, Tapestry, and Porcelaine.”

– John Adams — Letter to Abigail Adams, May 12, 1780

Whether you do it professionally or not, I think the arts are super important and everyone should have some sort of creative hobby. Maybe it’ll turn into your work, but that shouldn’t be the reason why you do it.

Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?

I’m going to go with this gem from Patrick Swayze in Point Break (ha!) “Fear causes hesitation. Hesitation will cause your worst fears to come true.” I think a lot of people are held back from doing what they want because “What if?” and I think that’s a really unfortunate way to live.

We are very blessed that some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US with whom you would love to have a private breakfast or lunch with, and why? He or she might just see this if we tag them.

I’d love to pick Tobi Lütke’s brain (Shopify’s CEO). They’ve built an amazing platform that has helped a lot of creatives and small businesses. As an avid snowboarder, I love his origin story of building the platform to run his snowboard company’s ecommerce. Would be a joy to swap notes.

Thank you for these fantastic insights. We greatly appreciate the time you spent on this.

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