How I Built This with Guy Raz - TOMS: Blake Mycoskie (2019)

Episode Date: February 11, 2019

Blake Mycoskie started and sold four businesses before age 30. But only in Argentina did he discover the idea he'd want to pursue long term. After seeing a shoe drive for children, he came up with TOMS — part shoe business, part philanthropy. PLUS for our postscript "How You Built That," we check back in with Dillon Hill, who built Gamers Gift to help bedbound and disabled patients enjoy a wide range of places and experiences through virtual reality. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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made it feel less like a visit and more like we were actually living there. Plus, taking a trip is the perfect time to host your space on Airbnb. your place with all of its personal touches and its amazing location could make someone else's vacation even better. Your home might be worth more than you think. Find out how much at Airbnb.ca.com slash host. Okay, so at some point in the past decade, you or someone you know probably owned a simple pair of cloth shoes. And there's a good chance those shoes may have been Tom's. because in the past decade, Blake Mikoski built a multi-million dollar shoe empire, inspired by a simple cloth shoe he once saw in Argentina. But Blake's journey to shoes took a lot of detours.

This story first ran in 2017. Enjoy. Well, I kind of freaked out. And I got this, like, small army of interns to help basically be customer service to email and call all these people and let them know that there was no chance that. They were going to get their shoes in the four days or five days of the website. Promised, it was going to be more like a couple months. And I literally, Fruit of Buenos Aires, took a taxi to this guy's house, Juan Torres, who was making the shoes in his garage force at the time.

And I walked in, and with the little Spanish I knew, I said something like, Muchos Zapato's Rapido. From NPR, it's how I built this, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built. I'm Guy Raz, and on today's show, how Blake Mikoski turned a goodwill mission into a multi-million dollar shoe empire and created a business model

unlike anything anyone had seen before. So I should probably let you know right at the outset here that today's show is going to be a little bit different because normally in the first half of the show, we hear the story of how an entrepreneur painstakingly builds his, his or her business from the ground up, and then, you know, how it goes from there, right?

And normally it's just one business. But with Blake Mikoski, it is not just one. Because before he even turned 30, he'd already launched four companies, and some of them did pretty well. And as for his best-known business, Tom's shoes, we're not even going to get there for a while. So hang tight. Blake's very first business dates back to the mid-1990s when he was a freshman in college. Growing up, he'd been a pretty good tennis player. He even played against Andy Roddick in high school.

And Blake was recruited to play at Southern Methodist University. And everything was going according to plan. That is until one day when he injured his Achilles tendon. I had this big cast on in crutches, and I wasn't able to play tennis for several months as I did rehab. But the other thing I couldn't do is I actually couldn't carry my laundry down to the facility in the college dorm. And so my laundry was piling up in my room and my roommate was probably not liking it that much. And this is hard to believe, but this is back before any search engine. So we had the yellow pages.

And I remember looking in the yellow pages to find a place that would come pick up and deliver my laundry back to me because I physically couldn't do it. And there was nothing like that in Dallas that. could find at the time, they would come to the campus and do that. And that ultimately led to my first business, which was called Easy Laundry. Blake partnered with his roommate, and eventually they figured out that the key to getting customers wasn't through the students, but actually through their parents. So the next year, he and his roommate got a booth at the freshman orientation. So the parents are kind of going, they're just kind of signing up for everything. You know, they're getting the books, they're getting the this, they're getting that, and they get to the laundry thing,

and they don't know how long we've been in business or if every kid on campus does it or not. But gosh, here's a chance to, you know, sign their kid up for something that's not that expensive. It'll help make sure that the kids don't ruin their clothes their freshman year if they haven't been used to washing and drying their own clothes. And it saves them some time that they can use for other things.

And we had a pretty good pitch. And within a series of like two or three days, we did like $80,000 in prepaid laundry sales for the year. From there, they actually expanded to four other colleges in Texas. And then they were doing so well that Blake dropped out of SMU to focus entirely on the company. And after a few years, they decided to sell it. So at 21, Blake walked away with about $100,000 and lots of time to kill. Yeah.

And I actually took a trip out to Los Angeles for the first time to take a little bit of time off, visit a couple friends that were going to school out here. And when I was in L.A., I saw these huge advertising. displays on the sides of buildings. Now, growing up in Texas, I'd never seen that. I'd never seen like a massive ad for an iPhone or a movie or whatever, you know, painted on the side of a building, yet there was a lot of that in Los Angeles. And I noticed that there not only was a lot of it, but there was almost exclusively advertising movies and TV shows. So the specific industry, the L.A. was known for. And I remember sitting there, I was actually sitting at Mel's Diner on Sunset. I'll never forget this moment.

and I was looking at this massive ad for, I think, one of the first Jurassic Park movies. And I was saying, God, this is so powerful. Like, there's no way you can tune out this type of advertising. Yeah. It's bigger than life. It's exciting. You know, I wanted to go see the movie because of the wall scape was so exciting. And underneath it, it had a name of a company, Van Wagner.

And that was a company that was a company that kind of called Van Wagner and said, yeah, I had this company, and I really want to do something really big in L.A., and I saw this ad. You know, anyways, could I rent this side of this building on sunset? And they said, well, actually we have a year-long contract with Warner Brothers for that one, so we can't. But we have some other one in town. And I was like, well, how much would it cost if I wanted to rent this one? And he said something, I think he said it was like $85,000 a month.

Wait, just pause for sake. You were, of course, pretending like you wanted to be. Yes, you just wanted to get the information. Yeah, I was just curious. Yeah. He says 85,000. Eighty-five thousand a month. Wow.

And so I'm thinking, hold on. That means that building owner is making over a million dollars a year just by renting the side of their building. And he has two sides because the building faces sunset two different ways. So that's $2 million on one building. And I thought, and there's no cost. Like, all you're doing is just painting or putting the vinyl on. There's no, like, actual billboard structure, steel and all that stuff you have to do. Like, this is incredible.

And I just started thinking to myself, like, who would pay $85,000? dollars and like why because there's no way that could make sense on a you know cost per thousand or an advertising metric I mean there's just not enough people that drive on sunset is what I was thinking yeah and so the reason that I basically came up with in my mind was it had to be ego driven you know it had to be that like all these studios in town went their movies on you know on the street they want to show the actor the starlet like I can put you on this building and like how big a deal is that and I was living in Nashville the time and I made a quick assumption that the country music industry had maybe not as big of egos,

but definitely some big egos in town. And what if I put country music stars on the sides of buildings? Huh. So is that what you did? Yeah. So I went back to Nashville and got after it and found out that, you know, there was no one that had ever done this in Nashville. And it was very, you know, challenging to get the city to allow me to do it. Ultimately, I had to convince the city because they had the Highway Beautification Act,

which kept people from putting up any new billboards, I think, like, after year 1984 or something. So what I ultimately came up with after, like, I don't know, countless city council meetings and discussions and this and that was I was going to actually make the city more beautiful because I was going to create country music art. And so what I did was I actually would put the album cover of the new Dixie Chicks or Shania Twain or whoever was coming out with an album. but there would be no like call to action, no like available at Best Buy from 999. It was just the art of the album. And by doing that, I convinced the city I was adding to the landscape of Nashville, which is all about country music. So what would you do?

You would call them up and say, hey, I have this idea. All you have to do is give me the side of your building and you get, you're just going to get cash. So yeah, the thing you don't ever want to do, especially when you're 22 years old and you're trying to talk to 50 and 60-year-old people who own apartment complexes, You don't want to use the word idea. Because if it's just an idea, then it's like you're not going to inspire a lot of confidence. Yeah. Because people can say, I don't like your idea.

I don't believe in your idea. But if you say, I have a business. And what we do is we lease, you know, the side of your building. And we'll guarantee you this amount of money per month. And we're going to resell the side of your building because we specialize in selling advertising to the country music industry. And you'll make money on an asset that you never thought you'd ever make money on. Wow. I mean, you were basically.

hustling them a little bit. Oh, a hustler. I mean, there's no doubt. Like, I mean, anyone is an entrepreneur, especially if they start really young. I mean, you got to fake it till you make it. And, you know, and I was never being dishonest. I was just saying, like, this is what I'm doing. And they had nothing to lose. Like, by signing a contract with me, then they were basically saying, okay, if you go out and lease this to the Dixie Chicks, let's say, and you can lease it for $10,000. And you're going to give me 30% of that just for me allowing you to do this. that's $3,000 extra dollars a month to a place that maybe was charging $500 a month for apartment. So basically I just created six new apartments that they didn't even have to take care of.

So how did you get the first company or who were labeled to agree to let you work with them to put their album on? Like how did you even have those connections? And how did you make that happen? It was just cold calling. You know, I mean, I found out who had albums coming out, did some research. And then I contacted, you know, the marketing person. hey, I know you're getting ready to promote, you know, this album. And I have a way that you can promote it larger than life right here in Nashville.

It's going to make a big impact. And you can be one of the first to do it. I mean, those are all things that marketing people love to hear. Yeah. And who was your first client? What was the first piece of art that you put up on the side of a building? Amy Grant. And we did it on the side of a Ramada hotel in downtown.

There's a picture of me and my partner who was helping me at the time, standing in front of it, you know, on the cover of the Nashville newspaper when it came out, and it was great. And then once we had that, we had credibility. And then we just started, you know, selling them right and left. What did the label pay for that? I think we charged for that one about, I want to say, $15,000 a month. So we were probably cash full in about $10,000 a month just for that one wall. I mean, do you think you had the confidence to do that because you had done the laundry business in college? Yeah, I mean, I learned a lot. I started the laundry business as 19. So I'd been, you know, kind of hustling and building and having employees and learning

about customer service and learning about all these things for about four years. So when I had this idea, I had probably a little bit more confidence. And, you know, I had nothing to lose, you know. It's like they either were going to say yesterday they weren't. And I've always been good with, you know, like just taking chances and seeing what happens. So eventually you left Nashville. What would you do with the company? So I ended up selling the company to Clear Channel. big media company that was really big into outdoor advertising. We ended up having walls in Nashville, and then we expanded to Dallas too. And once I got to Dallas, I realized that this was like a big business game.

Like I'd had some small successes, but it was very quickly that the big companies, like the Viacombs, Clear channels, Van Wagner's, they were onto my game, and it was going to be hard to compete with them. So did you walk out of that deal more or less set? Pretty set. Yeah, I mean, look, everything is relative, right? But I definitely had a nice cash flow coming in from that that I wasn't having to, you know, jump to L.A. and find a job. So when I moved to L.A., it was more kind of for fun and exploring what could be next. And I was fascinated with reality television and how it was becoming so popular. Because this is like right after like the first survivor came out. Yeah. And it just fascinated me. I think the competitiveness in me, the adventure, that, you know, like all that. And. And my sister and I were thinking about applying for Survivor. And we actually did apply for Survivor. Wait, you wanted to be contestants on Survivor?

Yeah. And the casting people of Survivor were also casting in this new show called The Amazing Race. And they called us up and said, hey, I don't think we can put you and your sister on Survivor. But they knew about the Amazing Race. And so they kind of talked us into thinking about the Amazing Race. And so we got into the process of being interviewed for that. and we got on. And then the actual show itself was 31 days.

So we literally disappeared from our world for 31 days, and we couldn't really tell anyone what we were doing because it's super confidential. So we just, like, disappeared. And you went from, like, country to country, right? Yeah, just all over the world. Take it right, take it right. Go, go, go, go.

And then when we were done, the hard part was the show wasn't going to start airing for another, you know, a couple months, and so we couldn't tell anyone what happened. and, you know, if we won or if we didn't win or how far we got. I mean, I mean, not to spoil the ending for anyone because it did there in 2002, but you barely, I mean, you almost won. You guys almost won a million bucks. Yeah.

And thankfully, we didn't, because I think that would have been a positive thing at that moment, but probably wouldn't have been good for my further drive from an entrepreneurial standpoint. So you, so the amazing risk ends, you've sold your company, and what? I mean, at this point, you are kind of, you're like 23, 24. 25 now, yeah. You're 25. You've got this check coming in from Clear Channel. I guess presumably you didn't really have to work if you, right?

You didn't have to do a whole lot. Yeah, I mean, but I was never really about the money. Like, I mean, every business I've ever started has been more of it at curiosity and a kind of what if. And so as I just got off the amazing race and was looking around and seeing how popular reality television was becoming and kind of understanding the basic metrics of, advertising and what advertisers want and targeting and all that, I just got really excited about the idea of a network of you really having your own channel that would be completely focused on reality and reality TV stars. Like a cable TV channel? But how did you, it's just amazing to me because I remember when I was 25 and I, you know, I was I worked pretty hard. I was a foreign correspondent.

And, you know, I was trying to like, you know, start my career and stuff. But I mean, I don't know too many 25 year olds who would think. like let me start a cable TV channel. Like that's a pretty bold idea to have when you're 25. Yeah. I mean, absolutely. But I felt like, you know, I felt like it was possible. Like it just seemed like I was in this position.

I started to understand by being on the show, the interest that people had. And it was just about finding the right people that knew how to do it and then figure out how to channel their energy and get the right capital together to do it. So did you raise money for it? So I did. So I, basically, I tracked down the gentleman who was the founder of the E channel and somehow got a meeting with him. And then he kind of said, look, Blake, it's so competitive now to start a channel. You know, it's probably about close to a million bucks, maybe $750,000 you would need just to get the lights turned on. And I said, well, I definitely don't have $750,000 to just kind of bet on this right out the gate.

But I do know some people who really understand. understand reality TV and who have some money that maybe they'd invest. And my idea was, is to go to all the winners of the reality shows of the last two years and get them to invest. You said you guys should all invest. Let's start a reality TV channel because you guys won. Yeah, and you got the money. They all got a million bucks or whatever. Yeah. Yes. And I got them all to invest. And then I put some of my own money in. And within a couple months, I raised a $750,000. And we launched what was called Reality Central. So you raise this money. And then And then what do you do?

Do you start like producing a reality show? No, the whole idea was that we would acquire the content for next to nothing, you know, to re-show. And then we would actually do kind of like mystery dinner theater where you had someone come on that was on the show and kind of talk you through what was happening. Oh, wow. That's a great idea. Yeah, so we thought it was. But, you know, so we really didn't have to spend a lot of many on the content. and it was more about trying to get the distribution,

which ultimately was the Achilles heel and why it didn't work. And because we had to go to like Comcast and Time Warner and charter and these big organizations that are cable networks that host all the channels and convince them that they should give us a slot of the one of 500 channels. And ultimately, we couldn't convince them of that. You know, it's funny because I hear you tell this story. And I think of you as somebody who has really tried to make the world a better place. I said, I don't know if your 24-hour reality channel would have made the world a better place.

No, it wouldn't have. And I'm so thankful that it didn't work. I would probably want to shoot myself if I was running a reality TV channel. Yeah. I mean, there's something genius about it and something really horribly sinister about it. So what happened with all the people, including you, who put money into it? Unfortunately, we all lost our money. It was really hard. I was pretty depressed for a while. I had to let go everyone. It was challenging.

So when that all kind of collapsed, what did you decide to do? Yeah, what did you decide do next? This is company three that now we've done.

I think the overarching theme of my entrepreneurial life, which I'm really thankful for, has been like there's been no connection from one business to another.

It's literally been me following kind of my curiosities. and the serendipitous conversations and experiences I have. And so the next business was totally that way. I was actually at a barbecue as we were kind of closing down the reality channel. And one of the people that worked for me, they had a son that was 15 years old and he was there. And I was asking him what he was doing that summer, you know, making small talk and waiting for a burger or something.

And he told me he was doing driver's ed. And I said, oh, it's got to be so exciting. I mean, you learn to drive. And he responded, like, totally in an uninspiring way. I mean, he just said, like, yeah, it's okay, you know, I go to this place and the teacher's boring. And I pretty much sleep through the class. And I was like, well, first off, this is not good that our future drivers in L.A. are sleeping through their driver's ed class.

That doesn't make me feel good by getting on the highway. And the second thing is, like, I mean, getting your license should be like this amazing experience for a 15-year-old. and there's got to be a better way to engage them. Yeah. And I just thought, gosh, like all these teenagers are starting to be online more and more. You know, maybe there's a way to kind of take this driver's ed instruction and learning into the technology that the teenagers are embracing. Yeah. So I had this idea to kind of start a new type of driver's ed company.

We would do all the instruction online. You'd have to pass things and the sequential management. manner so you could really make sure that they're learning and they're paying attention like they couldn't just like cram for the final test they would have to you know get to stages almost like a video game and I recognize that one of the ways to get them to pay attention and be more excited about the actual learning to drive was to have drivers ed teachers that were going to hold teenagers attention and the best way I could figure out to do that was I hired only uh models and actors and actresses part-time.

So you would basically hire, like, attractive people as the... Super attractive people that teenage boys and girls would be, like, you know, totally idolizing, you know? And I knew that would spread fast on the internet. And there's a lot of people in L.A. that are, you know, that need part-time work, need flexible schedules between auditions, you know, they're trying to make it. And I was really lucky. I found some guys that were already in the business of online traffic school and driver's ed. And so they kind of really knew. the business and we ended up being partners and I was a 33% partner in the new company that we formed together with these two other guys. How did you get the word out about it? You know, we did once again,

we went back to my old flyers, you know, I love the old flyers. So flyers at high schools, you know, lots of that, lots of, you know, targeting on MySpace, but it grew really quickly. Just to clarify to listeners, we are going to get to the good that you did in the world. We will get to that. We will get to that. So, okay, so you've got this fourth business, the driver's ed business that is going really well. And, I mean, could you have just continue to do this car thing forever and ever? Or, I mean, did you think that that was going to be the rest of your life? You know, I never think. I mean, I never thought like one business was going to be the rest of my life, probably until Tom's.

Blake Mikeski, when we come back, how a random conversation. in a wine bar in South America led Blake to Tom's and his biggest business yet. I'm Guy Raz, and you're listening to How I Built This from NPR. Hey, welcome back to How I Built This from NPR. I'm Guy Raz. So it's 2006, and Blake's driver's ed business has taken off. He's making good money. He's living a great life. But he was feeling a little bored, a little restless. So he decided to take a break and do something a little unusual.

He thought, why don't I learn how to play polo in Argentina? And it was actually after about being down there for about three weeks when I met serendipitously a few women that were in a wine bar that were talking in English, which was nice because most everyone was speaking Spanish and I didn't understand most of what they were saying. And when I asked about what they were doing, they explained they were doing something they characterized as a shoe drive.

And what that meant was they were going around collecting slightly used shoes from wealthy families in Buenos Aires to take to children who did not have shoes and couldn't afford shoes that needed them to go to school. And I was just really taken by their passion for this project and the fact that there were kids just outside of Buenos Aires that didn't have shoes because that was something kind of new to me. And, you know, I asked enough questions to get interested

and they offered me to come with them and help distribute the shoes. And I said, sure. They said, listen, do you want to just check it out with us? Like in the next couple days? Yeah, they were going like a week later, and I was going to be down there still. So, yeah. So what happened when you got down there?

The experience was an amazing one. I mean, I didn't have really any experience up at this point about volunteering or being in a place of poverty. But I saw these kids really light up when they got these shoes. And these weren't even new shoes. These were used shoes. But the kids were acting like it was, you know, Christmas Day. parents were excited and there was joy and after we put the shoes on the kids we played with them we jumped rope we played soccer we did all these things and and it was just a great day and so

I went back that evening and I was talking to my polo teachers named Alejo about the experience and and telling him what a great day I had and how you know how satisfying it was and I was going on and on just you know like when you're gushing with with enthusiasm and he and then he asked me a question that I really wasn't prepared for. He said, Blake, he said, this is amazing what you've done. And I commend you and doing this in my country. And I know what area you were in today. And that's a very challenging area for the families. And he said, but what happens when the kids, you know, grow out of their shoes or when they wear out of them? If it's their only pair, they're going to wear out of them? And I said, gosh, you know, I don't know. And his question kind of haunted me, to be honest,

because all of a sudden I thought, gosh, did we actually do something good? Or did we just further propagate a problem that they're going to have down the road. And I remember that night, like, actually having a little trouble sleeping and kind of wrestling with this question he asked. So I woke up the next morning and one of the things I've done since I was like 15 years old is I write in my journal almost every morning. And I was having a cup of coffee and writing in my journal and kind of thinking about this question. And ultimately I got to this idea of like, okay, well, if I really want to help these kids, which I really did, I really connected to this group, maybe I go and get all my friends to donate shoes a couple times a year and we bring them down. And I thought, well, you know,

that's, once again, dependent on other people's donations and what if they don't do it? And, you know, that doesn't seem like a very sustainable way to give these kids shoes. And then that led to, you know, well, what if there was a business, you know, instead of a charity and donations, what if I actually started a shoe business? And every time I sold a pair of shoes, I would give a pair away. What kind of shoes did you have in mind at that point? Well, you know, at the same time I'd been in Argentina for about a month and I'd noticed that a lot of the polo players and even some of their girlfriends were wearing these shoes called the Alpregata. And it was kind of like an espadryl type canvas shoe that was very different than anything I'd ever seen in the U.S. And it just like kind of magically kind of came together with, gosh, what if I sold these shoes that everyone down here is wearing to people who've never seen them and come back here and give away shoes to kids who need them?

So how did you even get started? So we just started meeting with people in town that made these shoes and asking them like, hey, could you change this? Could you change that? They all thought it was crazy because what they all, in what the country in Argentina would everyone appreciate about the shoe is they were really inexpensive and they were kind of disposable and they were, you know, not something that put too much investment in so people could buy them, you know, every month or two or a couple months as they kind of need a new pair. And so they thought some of our changes was going to make the shoe way too expensive, but they didn't really understand that we had a market that would pay because people were paying $40 for a pair of vans. If I could make something that had the same kind of longevity,

then they would pay $40 for this. And these were just like small-time artisanal shoemakers? Yeah. Yeah. And they were just people making them in their garages or making them in different, you know, small little barns and factories and things. So we got some ideas and they prototyped them. really rapidly because they were small little organizations.

And we made a couple hundred pairs of prototypes. And the name Tom's was birthed or created down there too because when I told Alejo what I wanted to do, I said, I think if we sell a pair of shoes today, we'll give away a pair of shoes tomorrow. And we'll call them tomorrow's shoes. And our slogan will be, shoes for a better tomorrow.

So it's all around this word tomorrow. And when it came time to put a tag on the shoe, we couldn't fit the word tomorrow's onto the tag because the tag was really small in the heel. So we shortened the word tomorrow's to Tom's. And that's how the word Tom's came. And so you get back to the U.S., how many pairs of shoes did you bring back? About 250 pairs. And what was your idea to just see if this would work like? Because you could have come back to the U.S. and people would have said, I'm not really sure about these.

Or you could have sold them all and then and then what? Yeah, it was definitely, I mean, I try to stress this to people. I mean, of all the businesses that I started, this was the least business of the businesses. And that's the irony of all of it. It was like, okay, there's 250 kids in this village. I want to come back by Christmas and give them all a new pair of shoes. So I'm going to go sell these shoes and I'm going to come back and then we'll figure out what we're going to do. Like it was not a business.

It was clearly like, this is a way for me to kind of stay connected to this amazing, I had of helping these kids and an excuse to come back to Argentina, which I'd totally fall in love with. And that was it. And I'd still do the driver's ed business. I'd still kind of have my normal life as an entrepreneur. But this would kind of be my side project and my kind of own personal, you know, fun, philanthropic experiment. And so when you came back to L.A., how did you sell the shoes? What did you do? So, I mean, first I kind of got sort of some friends and my sister and girlfriends and stuff to kind of buy them. And luckily they liked them and they thought they were cool and they were different

and they liked the style and they loved the idea that they were helping someone. And what did you charge for? At the originally price was I think 37 bucks. And so I sold a few pairs that way. And then I got some people, local people in L.A. that worked in PR that I had met through Friends of Friends to help me try to get the story out there because it was a really interesting story. And at the same time, they knew some, like, kind of cool, trendy kind of fashion stores that like to carry stuff that no one else has.

And this was clearly that. And so my first account was a store in L.A. called American Rag. I went in there with a little backpack full of these shoes, some pictures of the kids that we had helped in Argentina. And, you know, the girl's name is Courtney. She was a shoe buyer. And I shared her the shoes, and she really liked them. And then I told her the story, and then she just loved it. And she was like, this is totally unique.

This is totally us. She asked me how many pairs I had to sell. And I said, well, look, I started 250. I've sold about 30 pairs. So I have 220. I have a little website that's selling them as well. And so she took, I think, like 85 pairs and put a little display in the window at American Rag. And that was our first big account.

But one of the funniest and most amazing parts of the story and really kind of a turning point in all of it was this woman, Boothmore, who was at the time, kind of the leading fashion writer for the LA Times. She was in the store, American Rag, and heard about the story. And she asked for my information, and she contacted me, and she interviewed me. So I did interview. I tore the story, you know, emailed her a picture of one of the shoes. And the next Sunday, it was like on the cover of the calendar section of the LA Times. And that day, we sold 2,200 pairs on the website.

Wow. But I only had like 80 pairs in my apartment. In your apartment. You had 80 boxes or you're like 80 stacks of shoes. 2,200 pairs. What did you do? Well, I kind of freaked out. Okay, yeah.

I also did what I think a lot of entrepreneurs do in a time of dire need. I started putting as many ads for interns on Craigslist as I could. And I got this like small army of interns to help basically be customer service to email and call all these people and let them know that there was no chance that they were going to get their shoes in the four days or five. days of the website promised it was going to be more like, you know, maybe a couple months or, you know, longer because I had to go back and make them in Argentina. You literally had to hop on a plane and go back? Yeah. So like three days later after I got the interns set up with like laptops and phones in my apartment, I said, okay, I'm going back to make these shoes. And I took the article because I knew they would never believe me. And I literally, uh, Fruit of Buenos Aires,

I took a taxi to this guy's house, Juan Torres, who was making the shoes in his garage for us at the time. Had Alejo meet me there. And I walked in and with the little Spanish I knew, I said something like Muchos Zapato's Rapido. And yeah, and we just got cranking and Juan called some friends over and other people who knew how to make the shoes. And we got our own little kind of small little factory going in this little barn down there.

And after a couple weeks, we got to work and make about 900 pairs a week out of this little operation. So it took you, what, a month? Three, four weeks to make 2,200 pairs. So you have 2,200 pairs of shoes being made in Argentina, and then did you ship them back? Did you, like, stuff them in suitcases? Like, how did you bring them back? We literally, I mean, it was like we put them in, like, big boxes, and they flew back with me on American Airlines in the cargo area of the airplane. So you walk out of LAX with giant boxes of shoes.

You race back to your apartment in Venice. Is that right? Yeah. Met up with the interns and we started, you know. Shipping in the outs. Shipping boxes. Like, so did you have boxes made and did it look professional? Or was it just like just the shoes in like a padded envelope?

Yeah, basically. And so we got the UPS guy to actually come to our apartment and pick up every day, which was great. So we didn't have to like take them all the way to the, so the, place. And so, yeah, so we were running, shipping the stuff out of the apartment every day. And then because of that, we're getting more orders online. And we started, you know, talking to some more stores. So you guys were, I mean, you were like on a role already at this point, right? Yeah. And then the next big break was we got a call from Vogue magazine. And, uh, and that funny thing about that was I had just seen the movie, The Devil Wears Prada. Yeah. And so,

So I see Merrill Street playing Anna went toward And I see how challenging she is to Anne Hathaway's character And when I got a call from Vogue to come to New York to meet with them I was horrified They wanted you to come there to meet with them Why? Well I mean they wanted to interview me And they had read the LA Times article

And so yeah I went and they interviewed me And then later they did a photo shoot in Venice And next thing you know we were in Vogue And when we were in Vogue It just all kind of exploded exploded. Yeah. Everyone.

The crazy thing is that people just assumed like we were like a real company when we were in Vogue. And so we were getting calls from like stores, all of the country. And when did like celebrities start to catch on? That was also the benefit I think of being in L.A. And that it was just such a radical idea. Like no fashion company or true company had ever like given something away every time they sold it. And I think that naturally appealed to certain celebrities. and they also like, you know, wearing things that other people don't have and, like, it's new.

And so we just started, like, without any work on our own, we just started seeing celebrities wearing these shoes and they started getting photographed by the paparazzi. And then it started showing up in things like People Magazine and Us Weekly and OK. Wow. But the craziest moment for me was when I saw a stranger actually wearing the shoes. That was about three or four months later. I was actually in New York trying to sign up some. new stores. This was right before Vogue came out. I was a little discouraged and I was going to the

airport to fly back to L.A. And I actually wasn't wearing my shoes. I was wearing a pair of running shoes. Anyways, I'm at American Airlines. I'm checking in, using the kiosk and the girl next to me, she's probably mid-30s. She's wearing a red pair of tops. And at this point, like, the only people I've ever seen wearing our shoes are like my parents, my friends, my interns, maybe my neighbor, you know, and I was so excited. You know, like, here's like a total random person wearing a pair of our shoes. So, of course, you had to talk to her. Yeah. So I said, as we were doing the check in, I said, excuse me, I said, I couldn't help but notice these shoes you're wearing. They're really cool. What are they? And she, like, looked at me and she goes, oh, they're Tom's, Tom's shoes. This is like the most

amazing company in the world. I'm like, oh, really? Tell me about it. She's like, when I bought this pair of shoes, they gave a pair to a child in Argentina. And I'm like, I have to tell her who I am, right? And so I said, well, actually, you know, I'm actually Blake. I started Tom's. And she's like dead silent, you know, like, like she's just like, can't believe it. And then she looks at me, she goes, why did you cut your hair? And that was her main question. And the funny thing was why she knew I got my hair, why she knew I lived on a boat,

all this stuff was because of at this point now, you know, we're, we're on Facebook and we're, you know, we're promoting on YouTube. And she had not just been a customer. or she'd gone online and learned everything she possibly could about the business. And it just really started to kind of like, in my mind, from a entrepreneur and mathematical standpoint, be like, whoa, this could get big. It's just unbelievable. I mean, so everyone who bought a pair of Tom's new, more or less knew that when they were buying a pair, you guys would give a pair to a child in need. Yeah.

I mean, in the early days, I think that's the primary driver of why people bought Tom's. The shoes were, frankly, not that good of quality. They didn't last as long as we had hoped they would. I mean, you know, they were different. They were stylish, et cetera. But the giving was a huge, huge driver in the early days. You know, I mean, I'm like a total, I'm like three years behind everybody else. And I think the first time I heard about Tom's was in 2009, this commercial that I saw on TV.

What was that about? What happened? So I was doing a lot of media about Tom's. And so I think I was doing a CNN interview. and the woman asked me, she said, how in the world do you run your business? Because I'd just gotten back from Ethiopia on a giving trip. And she's like, Juan, you were in Ethiopia last week.

You were in, you know, Argentina three weeks before that. And you have this fast-growing business. Like, how are you running this company and being in all these places where you were giving out these shoes? And I held up my Blackberry at the time, which I had. And I said, this is the key. I said, I can literally approve designs, take orders, you know, do everything from this, and I can do it from Ethiopia.

And someone who worked at BBD&O ad agency, who AT&T was our client, saw that interview. And they thought, man, if this guy uses AT&T, this is the best commercial we could ever do. Right? And thankfully, I did use AT&T. So they called me up and they said, okay, well, we want to talk to you about an idea we have for a commercial.

My name is Blake, and I'm the chief shoegiver at Tom Shoes. They went with us on a real giving trip in Uruguay. When you went and handed out shoes to kids. When we hand out shoes, they filmed us in our office. I need a network with great coverage because for every pair of shoes that we sell, everything was just totally real, totally legit, and they made it into a very different type of commercial for AT&T, but it just hit a nerve with people. That was a turning point.

That turned Tom's from kind of this fashion niche thing to a major shoe company. Yeah, I mean, that was the turning point. Because now, I mean, you know, millions and millions of Americans, at least we're seeing our story multiple times throughout the week on different shows and commercials. And that was just driving the business in an incredible way. And by this point, had you, I mean, I'm assuming you hired a team to help you run this growing business, right? Because you were probably doing, like, what kind of revenue were you doing every year? At that point, I mean, we did the first year in business, I want to say we did about 300,000. And the second year, we did about $3 million.

And the third year we did like $15 million. And the fourth year, we went to like $60 million. I mean, we went from basically from zero to $450 million in sales on an annual basis in like seven years. you know, I think it became the fastest growing shoe company in the world. That's insane. Yeah, it was insane. What did you find to be the hardest thing about growing so quickly, you know, after that commercial and after you just started like going gangbusters? I mean, you had this.

Making the shoes. For sure. And even, I mean, even until just, I would say, recently is the last two years, making the shoes has always been the hardest part for us. because none of us were shoemakers. None of us were, you know, production people. I mean, it was all just different people I met along the journey that had a passion for, you know, for helping kids and doing something disruptive and having fun. And so the discipline of being in great making shoes

has always been something that we've struggled with. And we've really just recently in the last couple of years gotten better at. But like I'm wondering about something that happened around 2011, 2012, because you decided to just take a step back from the whole, whole company and just like drop off the map. So why? Well, the business was was becoming pretty corporate, pretty kind of bureaucratic. We had, you know, a leadership team that we had built that was, you know, maybe not running it the same kind of way that we used to and same passion. And I didn't

feel as connected to the mission of Tom's. And I was questioning, like, is this something I wanted the rest of my life or like my other entrepreneur gigs, is it time to go and do something different? And so I just felt the best thing for me to do, which I've always found is when I'm struggling. It's just to get away and kind of be alone and take some time. And I did that. What did you do? Did you just like go take a hike? No, I went back to Austin, Texas, where I originally love Austin. And I'd just gotten married. And so my wife and I decided to move to Austin for a year. I mean, if the company became super corporate and you were kind of disillusioned, what happened to make you want to return to it?

Ultimately, I realized there was more to be done. You know, like we had bigger ambitions than what we had accomplished before. You know, I felt like we could use our model to help more people with more products. I had enough new things that kind of get my energy again. You know, it was just time for me to come back. And it was really my wife, actually. She recognized that I was kind of getting into a depressed state in Austin. And I just realized when I was gone that I loved it.

Like, I missed it. I missed the people. I missed being in it, missed the challenges. Yeah. I mean, I've seen you refer to Tom's as a movement rather than a business. Obviously, you know there's some people who are cynical about that and then they say, oh, that's just, that's just Blake, you know, he's just using that as a way to generate more interest in his business. But is that, like, is that how you see it, a movement rather than a business? You know, I think, I think that the movement part, I really felt that. when our customers are engaged in the effect that they're having with their business

and that maybe buying a pair of tombs is the first step or maybe it's the 10th step and their desire to be more conscious consumers and humans. And so to me, that is more of a movement of a way of thinking than it is a business transaction. Blake, you, I mean, you've read and know about, you know, over the years, people have said, look, you know, this might sound like a great business model, but actually Tom's is disrupting markets in these countries. And they're actually not helping alleviate poverty. And, you know, they're actually creating other problems. I mean, surely some of those criticisms are, there's some, you know, merit to them, right? Yes. I mean, the first and kind of most

prevalent criticism has been like, okay, if Tom's really want to make a difference in the communities, they would not just focus on aid. They would focus on job creation. And that criticism was really difficult to hear it first because, frankly, I just didn't know how to address it. Like, I agreed with it. You know, yes, in theory, it would be amazing to create a bunch of jobs in Kenya. But, I mean, how in the world am I going to figure that out, like with everything else going on? But ultimately, back in 2000, I think it was 12, actually, we made a pledge to manufacture as many shoes as we could in the countries that we give in. And today we're manufacturing over 40% of our giving shoes in countries like Kenya, Ethiopia, India, you know, lots of different places where we're also giving. So was that was that a direct response to your critics or sort of like saying, you know what, you're right? It was. It was. It was. And it was a humbling experience in one where we had to express some vulnerability and say, okay, we don't know how to do this.

We're going to try it. And we started small. We scaled as we've gone. And it's actually been, you know, now it's something that we pride ourselves in as part of our business. I mean, the idea of the buy one and then we'll give one to somebody you need, really, you know, you guys are credited with really starting this model. You probably weren't the first. There were probably other companies out there doing this.

But, you know, you did this on a very big. big scale. And since then, lots and lots and lots of companies have followed that model, Warby Parker and others. And it's been good for business. I mean, that model's actually been really, really good. Yeah, I mean, I think of all the things we're most proud of Tom's is like the legacy that we've created in this model has become not just a relevant model of Tom's, but with lots of companies around the world. And it's encouraged even companies beyond the one-for-one model to incorporate giving more into their actual. And it's encouraged, even companies beyond the one-for-one model to incorporate giving more into their actual. actual business model and not just a check that they write at the end of the year, you know, to a nonprofit. Yeah. Yeah, I think about like the arc of your career, right? I mean, the laundry business for college students and the outdoor advertising company and the reality TV channel and then the driver's ed school.

I mean, very different from what you did with Tom's, right? Like, very, very different. But do you think that you could have done, Tom's without doing all? all those previous companies? I don't think Tom's would be where it is today if I hadn't had those experiences. The thinking behind Tom's was always there, but it was always something that was more in an order of

make money first, help others second, because that's how every other business person I'd ever known had done it. You know, I never had read about anyone that was helping people as they were building the business. And I think that Tom's is like my soulmate of business. I mean, it's like I get to be creative, I get to find meaning in that. You know, I recognize that this amount of wealth that now my wife and I were responsible for

was far more than we would ever think about spending in our lifetime. And so we made a real conscious decision to take half of it and commit it to investing in social entrepreneurs. So that's a big part of my life now is actually investing in the next generation as a way to solve problems that we are faced with. And so that's been a huge blessing in all of this as well. Blake Mikoski, founder of Tom's Shoes. By the way, Tom's has given away more than 70 million shoes in 70 countries around the world. Back in 2014, Blake sold half of the company to a private equity group.

Up until then, Tom's had never had a single investor. Do people call you Tom? All the time. Yeah. And I answer to it. You say, yeah. They'll say, hey, Tom. People say, hey, Tom, at the airport, I turn around just as if they said, hey, Blake, because I know who they're talking to them.

Hey, thanks so much for sticking around because it's time now for how you built that. And today we're updating a story from 2017 about Gamer's Gift. It's a nonprofit co-founded by Dylan Hill when he was a student at UC Davis. Yeah, so our biggest thing right now is bringing virtual reality, the headsets to children's hospitals, assisted living facilities, and people with disabilities. And this idea goes all the way back to the fifth grade when Dylan's best friend, Chris, was diagnosed with cancer and had to spend months in the hospital. I would visit him every single day, and what I saw was my friend was no longer the kid that I knew. And my solution was to bring the video games because I knew that those would make him smile. Chris eventually did get better, and he and Dylan stayed friends.

And that experience always stuck with me. And I remember looking back on it as, because, wow, those video games really helped us. So anyway, fast forward to senior year in high school. And Dylan is now doing volunteer work in his spare time. But he's not all that happy with it. I volunteered at a food shelter, and instead of spending time with the homeless, I was in the back packing bags. And obviously all these things they helped, but it just wasn't rewarding.

And Dylan kept thinking about the video games. Maybe there was some way he could use them to help people. So one day, he and Chris were doing a little random Googling, and Dylan said, hey, I wonder what it would take to start our own charity. And we Googled how to start a nonprofit, and we saw, wow, this is simplified into six steps. First make an LLC and then get in touch with the franchise tax board. Actually, some of this stuff does not sound so simple. But eventually Dylan got his mom to guarantee a bank account for their nonprofit. And they became a 501c3.

I think we probably Googled every single line on the tax paperwork because we had no idea what a lot of it meant. But, I mean, we have the internet. You know, we can figure out anything. And so after they got it sorted out, Dylan and Chris started to raise money to buy video games and VR headsets. First, they sold baked goods door to door. Then they got some donation through an online service. Then they were starting to visit hospitals in other places in California, sharing VR and games with children and adults. So, for example, there was this man Dominic who's living with cerebral palsy, and he's always wanted to drive a race car.

Now, he's only able to communicate by moving his head up or down, but we can put a headset on him, and we can push his wheelchair around his living room, and we can emulate him driving a Formula One race car. That's Dylan Hill, who co-founded Gamer's Gift, along with his friend Chris Spettancourt. Now, a lot has happened since we first brought you that story. Chris's leukemia returned in October of 2017, and his prognosis was not good. So Chris came up with a bucket list, things he wanted to do before he died. And Dylan wanted to help. On that list, beat a world record. Chris and Dylan wanted to register the most bone marrow donors in one day.

The world record was 2,976. So Chris and Dylan launched a social media campaign, and they got 3,715 people to register. And they got something else, something they didn't really expect. A match for Chris. Two months later, Chris had a bone marrow transplant. And today, he's cancer-free. If you want to find out more about gamers' gift,

check out our Facebook page. And to hear previous episodes, head to our podcast page, How I Built This.NPR.org. And of course, if you want to tell us your story, go to build.npr. And thanks so much for listening to our show this week. You can subscribe wherever you get your podcasts, and while you're there, please do give us a review.

You can also write us at hibt at npr.org. You can also tweet us. It's at How I Built This. Our show is produced this week by Rund Abd al-Fata with original music composed by Rumpteen Arablui. Thanks also to Mia Ventcat, Jay C. Howard, Norcudsi, Neva Grant, Melissa Gray, Sanaz Meshkampur, and Jeff Rogers.

Our intern is Candice Lem. I'm Guy Raz, and you've been listening to How I Built This from NPR.