TE 30: Greg Selkoe: Founder/CEO of Karmaloop

SHOW OVERVIEW

Greg Selkoe is the founder & CEO of Karmaloop: the leading online retailer in cutting edge fashion and a one-stop shop for the verge culture. Karma loop did $150 million in sales in 2013 and currently has 150 employees. 

In today’s episode you’ll learn:

  • Greg’s backstory and how he was always a problem child.
  • How Greg built Karmaloop out of his parent’s basement. 
  • What it takes to build a community that supports your product.
  • The importance of commitment, focus & overcoming obstacles.

 

Click here to download the show on iTunes!

 

FROM PROBLEM CHILD TO ENTREPRENEUR (3:30)

Greg admits that he was a problem child growing up. “That’s pretty much universally how people remember me. I was always getting in trouble, screwing around, and just causing a lot of people a lot of grief.
Growing up in the Boston area, Greg says he had a few tussles (fights), got a fake I.D., would buy friends alcohol. “I didn’t feel like I fit in. I had some learning disability issues and stuff, so I really just wanted to chase girls and have fun,” he explains.

Greg was kicked out of school in his fifth grade and his 11th grade years in school. “I went to a special school fo kids who got kicked out of school and needed extra help and stuff, which was really good for me.”

The alternative school helped him figure out how he learned best, and about different learning styles.

Greg says he was kicked out of school his junior year for his bad attendance record, “and a bunch of other things.”

His parents weren’t surprised, according to Selkoe, saying he was always getting in trouble.

Greg admits he was somewhat of a disappointment to his parents — his dad being a professor, and mom and Urban Planner — who both valued education. “I think they were much more worried about me in grade school. By high school, they were just used to it,” he says.

GOING TO “SPECIAL SCHOOL” (6:40)

Greg attended an alternative school his senior year. He attributes that year with helping him gain discipline, learning how to learn, and developing his artistic side, saying he did graffiti art on clothing during that time.

After graduating from the boarding school his senior year, Greg was admitted to Rollins College in Florida. “It was amazing that I got into college, really, but you know, I was able to get myself through college and graduate.”


ATTENDING COLLEGE AS A PROBLEM CHILD (8:40)

Greg says he first attended college to have fun, “I was getting drunk a lot and chasing girls and what not,” he says, “by the end, I was like, ‘you know what? This learning stuff’s not so bad.’ I kind of always knew that, but it was just, I didn’t’ have it in me to sti still until I started getting a little older.”

Greg says he really isn’t sure what advice he’d give to a teenage entrepreneur about college or starting the business. “the fact is , if you’ve got a really good idea, if you’re the next Zuckerberg or whatever, I guess it makes sense to pursue your business, you can always go back to school. But, if you’re just saying, ‘Oh, I’m just here because it’s glamorous to be like, oh, I dropped out of college, I’m not going to finish any of this school,’ then, it’s not… it ( make sense. You gotta actually have something real that you’re pursuing.”

STARTING KarmaLoop (10:45)

Greg started KarmaLoop about three years after graduating college. He completed a Bachelor’s Degree in Anthropology (the study of humans) at Rollins University and went to work for the City of Boston in the Urban Planning department.

He enjoyed his first job “which was cool,” he says, “I liked it, but, it just was something that I liked, but, my whole lifestyle was into… more into urban culture and hip-hop, and electronic music and stuff like that.”

He explains that the name for the business, “KarmaLoop” came from a point of desperation. “I didn’t have a name,” he says, but, “I knew I wanted to start this business… a street-ware business.”

Greg asked his friend to help with the initial design. The friend had a degree in sacred geometry – the study of Buddhist and Celtic symbols. His first design was based on the Buddhist symbol of karma. “So, from that, the actual design of the first layout, it’s like where we got the name of the site.”

Saying it was an accident, “it seems like it worked out,” says Greg.

BUILDING THE BUSINESS OF KarmaLoop (13:15)

KarmaLoop was established in 2000, To begin selling products, Greg contacted clothing brands, convinced them to allow him to sell clothes on consignment, “which mean,” he explains, “that they give me clothes, and then, when I sell it, I pay them.”

99 percent of the companies he approached told him he was crazy, and refused to to business with him. “but, I was able to convince World Brands to do that with us,” he says.

The first website was Joomla-based with an off-the-shelf back-end that used eBay as the storefront. His friend, Adrian, helped him get the website up and designed.

Still working with the Boston Urban Planning Department while launching KarmaLoop, he says his family and friends were supportive, but thought of his business as a hobby. “But, when I started to decide that I was going to try and quit my job and make a career, a lot of people were like, ‘you’re crazy, dud, what are you doing?’”

Greg says his relentless pursuit of KarmaLoop as his full-time employment is his “biggest skill as an entrepreneur… just surviving and keep continuing to keep going.”

STARTING OUT WITH NOTHING (15:45)

Greg says his company started out selling brands of clothing they bought. “Even now,” he says, “most of our brands are stuff that we don’t design.” Greg says KarmaLoop has now also developed and designed private label products for sale, as well.

Explaining how he built his loyal following, Greg says his customers come to him to find out what’s next in hip-hop and street-ware fashions. Customers “come to Karma to discover new styles, new trends, new brands. So, they might want to buy some Adidas sneakers, some Crook’s sweatshirt and Xanerobe pants… it’s all about shopping. It’s about the next thing. It’s about curation.”

Greg says the first few years were rough. Starting the business at the age of 26, he recalls, “if you don’t have a lot of energy, I say, ‘don’t be an entrepreneur.’”

Working all day at his Urban Planning job, “I’d come home at night and I’d work i my parent’s basement on the Karma side of things. So, I was barely sleeping, I was just working my ass off. But, that’s what you gotta do.”

Greg worked both the business and the job for about two years. He says leaving the security of his planning job was “a little nerve-wracking. I lived at home so I couldn’t afford it.” But, he was convinced and focused on making it work.

GROWING THE BUSINESS OUT OF THE BASEMENT (18:00)

Eventually, Greg was able to bring in another employee to help scale his business. His first employee, Sarah, was a buyer. To grow his business, he had to go to friends and family to raise money – and borrow money – to get KarmaLoop established. “You gotta kinda re-invest and then, also, in my case, some businesses you don’t need to do this, but, in my case, I had to get investors to raise money.”

Greg says the business didn’t really start taking off until 2005, and didn’t break even until 2006 – six years after starting the business.

LEADING A COMPANY OF 150 (19:30)

Since growing the company from 2002 with a handful of employees to a company of 150, Greg says he leads his company by example. “I still work as hard as anyone. We try to have good people who are smart and can run their own departments, and let them come up with ideas.”

As the company has grown, “I’ve had to work to make sure that I let other voices be heard just besides me,” he explains.

To accomplish this, KarmaLoop he says he has “smart people who know what they’re doing and let them run with it.”

KarmaLoop AND MUSIC (20:10)

Early on, KarmaLoop began developing relationships with hip-hop artists sich as Cruella, Kid Kutty, Kendrick Lamar and others. Today, Greg says they’re working with a rapper, Chance right now. “We’ve always had a connection with the music industry even when I first started.”

Greg says a large part of his marketing at first was calling labels and artists, “we’d do deals where we’d give away CD Singles in our boxes in exchange for exposure. So, music has always been a big part of it.”

The brand is currently sponsoring a campus tour – the third tour they’ve sponsored. “we’re kind of about getting involved with talent early,” he says.

ADVICE TO A YOUNGER GREG (22:30)

When asked by Teenage Entrepreneur host Jordan Agolli what advice he would give to himself back in 2001, Greg says his advice would be to “focus.”

“I tried a lot of different sort of side businesses as projects,” he explains.
He says he’d also advice himself “that, unfortunately, part of the job is you gotta fire people and let people go when it’s not working out.”

Greg says he’s always had a hard time letting people go. “It took me a long time to really learn that,” he says, “I still struggle with that a little bit… but, generally, I’m happy with the way things turned out.

He says it’s so hard to let people go because he builds friendships with his employees. “I liked building the business [because] it’s not just about money, its about building friendships and building networks, and creating something.”
Greg acknowledges that letting someone go doesn’t always mean an employee is the worst. “But, sometimes, if they’re not doing what they’re supposed to, it’s not fair to me, either… we need the best people we can have, or y ou just can’t get ahead so you gotta — sometimes making a decision that’s best for business is not always easy.

A VISION FOR Karmaloop AFTER 15 YEARS (24:50)

Greg says his vision for the company is to “keep doing what we’re doing, and continue to spin internationally and keep having fun.”

Greg admits that, at times, he’s entertained other business options. “I was looking into a cable station… I haven’t always been that good at staying focused to be honest.”
Having started projects, some that have worked well, and others that did not.

He says the success of other projects will depend on how unfocused he gets.

One project worked well, “Because it’s really just the same project, but it’s our off price, old season stuff… sometimes it’s not always bad to try new things,but if they’re too far field… it [takes] my eye off the ball on the clothing side of things.”

Greg admits that entrepreneurs “naturally are going to always want to continue to grow, and expand, and build. It’s just part of it. You gotta have a balance. You get bored if you just do the same thing all the time, too,” he admits.

GREG’S PLAN FOR HIS LEGACY (26:30)

Admitting he’s never thought of what he would want his legacy to be, Greg says “I think I want my legacy to be more than Karma. As much as I love it.”

Saying he wants to keep growing and building, he says, “I try to do a lot of non-profit work in Boston.”
Greg has started a group that helps young entrepreneurs in the city. “I hope that my impact on the world will be bigger than just making a company and making money, but actually try to do stuff to change things, and make the world a better place.”

That, he says, is the second phase of his life. “Right now, I’m focused on Karma and just building the best business that I can.”

JORDAN’S TAKE (27:50)

“If you want to succeed, you cannot give up,” Jordan summarizes the interview.

He notes the path Greg Selkoe took from struggling in school, to working as an Urban Planner and launching his business at the same time, and eating for six years before the company ever broke even.

“He put in the hard work,” Jordan explains, “he believed in himself. And a lot of people told him that he wouldn’t be able to do it, but he didn’t care, because he’s optimistic. And that’s what you need to do.”

  • Be optimistic
  • Put in the hard work
  • Be patient

“Look where he’s at today, because he refused to give up. I know it’s inspiring for me to hear and I know it’s inspiring for you guys as well,” Jordan continues.

So, next time you want to give up at something, and your’e like ‘oh, I’ve been doing this for two years now,’ remember that Greg was doing it for way longer before he really reached that level of success.”

Podcast Show Notes and Transcription Services by

The Show Notes Guy, Phillip Swindall

http://www.shownotesguy.com