Episode 214: Radical Entrance, Glorious Exit: Jason Lucash Retires from the Industry

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I remember like it was literally yesterday, so like this is such a good story. I was still working at JanSport at the time. Mike left JanSport early to like go Origadio full-time, meaning Mike gave up his paycheck and started trying to find some speakers. So we—

today we say goodbye to a legend, though I'm sure he hates that moniker. It's quite fitting. Jason Lukasz is retiring from promo, stepping stepping down from his role as Chief Development Officer at HPG, Jason and his amazing business partner Michael Simczak founded Aurigaudio in 2009 and shortly thereafter burst onto the scene in our industry. And within 10 years would sell over $100 million worth of product, eventually selling the company to top 10 industry supplier HPG. Now normally that's the end of an entrepreneur's story, but Jason's not your ordinary entrepreneur. The evolution of his career would involve multiple roles from startup entrepreneur, founder, CEO, senior VP of marketing, chief development officer, board member, investor, category creator, developer of over 150 products and more. If you're new to the business, his accolades are too many to name, but here's a few worth noting. He was recognized as Entrepreneur Magazine's Entrepreneur of the Year, listed 5 times on the Inc. 500 Fastest Growing Companies list, featured in Time Magazine's 50 Best Inventions. His industry awards are numerous. He was recognized as the fastest growing supplier in the industry multiple times, including ASI's Entrepreneur of the Year. Hi friends, I'm Bobby LeHew, Commonsku's Chief Content Officer. Today I'm joined by Mark Graham, Commonsku's President and Chief Brand Officer. On Friday when we got the notice about Jason's departure, all three of us immediately agreed to have one last conversation before Jason rides off into the sunset. There's so many lessons to learn unpacking Jason's journey, so we explore multiple areas today. We chat about Aurig Audio's rise and what led to their amazing breakthrough and record-breaking sales. We talk about how a nimble, quirky, and creative brand sells to a larger supply without selling out. The transformation and challenges as Jason the entrepreneur became Jason the chief development officer. How a large supplier like HPG gave Jason a creative incubator. A surprising success story about how a larger company like HPG can acquire and integrate a brand while keeping an innovative edge. How Batch and Bodega became a category creator but also broke through the virtual walls, building across utilization of teams across a global enterprise. And of course, the difficulty in just saying goodbye, and more. Today's episode is brought to you by Commenscue, the work from anywhere platform that powers your connected workflow, enabling you to process more orders and dramatically grow your sales. To learn more or to begin your free trial now, visit commenscue.com. Now join us as we reflect on an incredible journey, unpack an amazing career, but mostly as we learn vicariously through one of the industry's most innovative minds.

All right, let's jump right into it, Jason. Why the decision to leave right now? I mean, it seems like HPG is a rocket ship. It's riding high. The brand is finally coming into its own. Why leave now?

Yeah, HPG is, and I'm still a major, huge fan of HPG. I have my seat on our board. I'm still on our board here, and I'm a major shareholder at HPG too. So I obviously I think HBG is on the cusp of great things and has been for quite some time. I think it's just time, honestly. Like, I'm 38. I've devoted a third of my life to this work over the last 13 years. Mike and I started Origadio, and the initial idea was in February 2009, so exactly 13 years ago. And it's time. Like, I don't know, I feel like I've done everything I possibly could have done and have accomplished at HBG. And A little burnt out. I haven't had a break in 13 years. I mean, you guys both know how that is, um, from running, you know, a marathon a day for 13 years. And I just feel like it was honestly, it's just time. Maybe I'm like going out, like someone says like Tom Brady retiring from football. I was like, okay, well, like that's completely different because Tom Brady is in my mind, the greatest football player that's ever played the game. And I'm like, I'm a promo guy like everyone else. Like it's not a good comparison, but. I think a good analogy was like Tom Brady just didn't want like the ceremonial send-off and didn't want like the last season. And the same way, I mean, like talked about on Thursday and then my last day was Friday and then that's it. So I don't want like the pomp and circumstance, even though there wouldn't be, because it's just like someone leaving a company versus the greatest quarterback retiring of all time. So yeah.

Well, and incidentally, it's kind of cool to be recording this with you on day one of your unemployment. So this is, this is pretty fun for us.

All right.

Well, Jason, I want to dig into that a little bit more. At what point did this start? When did that little Jason voice in your head start yapping in your ear that it was time for you to start considering leaving HBG? Was it a week ago? Was it 3 years ago? Tell me about this decision-making process.

So we sold Origadio to HBG in September of 2018. And at that time when we sold, I had a major liquidity event and I was in a financial position where I didn't have to work ever again a day in my life. And super grateful, obviously. You guys know me, I'm a straight shooter. I'm very humble, unbelievable life change immediately overnight. I stayed to work at HBG because honestly, I cared and I still care. I cared about Oregadio. I wanted to make sure Oregadio was sent off to summer camp and had good camp counselors to take care of it throughout the whole summer. And I did. And I also stayed on at HBG because I had skin in the game. I still have skin in the game as a shareholder. But I wanted to have HBG embrace creativity. And they did. They invested in me. They invested in like the in-house agency I built out here in Danville, in the Bay Area, and allowed me to be creative and create cool and awesome opportunities and experiences for the industry. And I did that. So But I always kind of like thought back to that day one of like, I don't have to do this. I do this because I'm passionate and I like being creative, but maybe there's something else that's more important at the end of the day. I traveled consistently. Like I've flown— anyone who follows me on like social media, I've flown like 1.7 million miles or whatever it is on United. And then I still fly other airlines too, but like I travel constantly and like, I have two little girls, like I have a 3.5-year-old and 1.5-year-old girl. 2 little girls and my wife's at home with them, like, maybe there's things that are more important at the end of the day than selling the latest and greatest, like, widget. And it kind of just kind of all came together for me.

Translation: burnout. Is that fair to say? Would you say that, you know, 38 Jason Lukash is burnt out and needs to kind of chill out for a bit? Am I putting words in your mouth?

No, I mean, I I was burnt out during COVID for sure. Right? Like the transition of like having our team in Southern California and COVID hit and getting rid of 65 people that you handpicked and hired. And look, HPG, we had to do that. It was the right business decision. Orgad, it was just hit hard during COVID and it didn't make financial sense to have a facility in Southern California when we have, you know, HPG super facilities across the country and there's cheaper labor. But that was like really hard and that carried with me for a long time. And we like worked our ass off throughout COVID, like after COVID's not over, but just like, I was just tired. I was just tired of like, kind of like trying to fix things during COVID And yeah, I mean, I was a little burnt out, like burnt out in the industry. The industry, as you guys know, has changed dramatically during COVID too. And like, I still don't think the industry's recovered and I don't think the industry will recover for quite some time. So a lot of that compounded into one and I guess you could say burnt out a little, but I really was burnt out during COVID Yeah.

Let me ask you a bit of a sidebar question, Jason. Now that you talk about COVID and you talk about Aurig Audio and also the timing of the sale to HPG in 2018, what do you think would've happened to Aurig Audio had you not sold? To HPG and you had to weather COVID full on as an independent organization? I mean, I'm just curious about that. Do you, like, I think you would've solved it because I know you and Mike and you're fighters and you're very scrappy and creative, but would you have made it in light of some of the comments you just made?

That's like such a good question. And ironically, I talked to Mike about that. So I made my decision, talked to my wife, and talk to my work wife, Mike Simczak, and Mike and I talked about this on Friday afternoon. We would've weathered the storm, but we probably would've done— we would've been forced to do the same thing. Like we would've had to let go of our staff. I don't think like I wouldn't have done like everyone else and switched to selling PPE because like I still didn't believe, like I would never deviate from my core, even if financially I had to do that. Like I wouldn't have made that pivot, but Or got you. I mean, Orgai is remounted actually back to like pre-COVID levels as a business unit and Orgai is super strong, but also because we made some of the hard moves that we had to make during COVID to weather the storm. But I don't know how well we would've been able to kind of pull out of COVID if it wasn't honestly like for like HBG behind us, because all of the shared resources and just like synergies that made financial sense at the end of the day, but It probably would've made an even harder impact on myself because I wouldn't have had other people to lean on like I did at HBG to weather that storm. I would've just had Mike, right? And that's tough. And all those moves were super tough and like having HBG and Chris and Trina and some of the senior leadership here to like, to help with that and the private equity firm 10X behind us, like it made it a lot easier, but it would've probably been way worse. You know, if it was just Jason and Mike show, I'd imagine.

Yeah, Jason, you mentioned burnout, and how much of this decision has been end of the contract, into the buyout agreement, it reached the, you know, last, last mile on the last road, and how much of it is just, I really am done? And once you answer that question, Mike, real question getting to it is, how would you advise Jason Lukash, who's listening to this now, to manage himself and his business going forward better so that they can avoid hitting what— I mean, you could argue this is burnout or it's a reinvention, but I'll let you answer.

Yeah, I think it's both because the same thing happened to me at Jansport. I was burnt out when I started Origadio, and that's how Origadio was birthed. I was burnt out of traveling and working nonstop for a corporate entity. I, through all that, like, I came up with the idea with Mike to create speakers and like pursue a passion project. So I think maybe this would allow for a reinvention. I don't know what it is or like, right. That'll ever happen. Right. Like, right. And my days, like, well, it's day one, but I had a dance party with my girls to the Frozen soundtrack this morning. So it wasn't, um, you never know, like when that next idea is going to come. Um, but I think like burnout played like a big role in this. And like, I, I want to like get us through like PPAI, which happened, right? And like, we had an awesome, like a really cool experience. And like, I, I kind of feel like I've accomplished everything that I've, I could possibly have accomplished here or I got HPG, which makes you feel burnt out on the inside. But yeah, I don't know. I mean, I think it will be a good like reinvention. And honestly, for me, like family first, like I have a lot of other stuff I do on the side that like, yeah, my wife and I like during COVID because I like to solve problems, like never flipped a house ever. So my wife and I decided like flip like multimillion dollar houses in the Bay Area. Like having them— why not? Right. Yeah. And like, I recently became like a volunteer police officer, like knowing nothing about the law enforcement industry because my dad's done it for like 10 years to be his partner. So like, so great side stuff and like I think the side stuff is more interesting because there's more of those things for me to figure out, because I've kind of— I feel like I've kind of figured everything out within the walls, you know?

Yeah, there's something about that, following those weird fascinations that really turn into something great. So take us, take us back to this. This is what's kind of fascinating about seeing your, you know, radical entry into the business and glorious exit, is that many of us have watched your entire journey. Like, so we were there at the beginning and we were here, we're here at the quote-unquote end.

We're actually like probably there at the beginning of like day one PPI. Front seat.

Well, that's what I'm going to ask.

So take us back to that first PPAI Expo where Aurigaudio exhibited. You're on the show floor and unbeknownst perhaps even to you, you created quite a stir.

I remember like it was literally yesterday. So like, this is such a good story. I was still working at Jansport at the time. Mike left Jansport early to like go Aurigaudio full-time, meaning Mike gave up his paycheck and started trying to find some speakers. So we are our first product. We launched in August of '09. Our first product was Time Magazine's 50 Best Inventions of the Year, like 3 months after that. And then CES called us and said, hey, CES, you know, usually back in the day would book out like a year in advance. So like, we saw you on this Time list. We think it's really cool. We'll make a booth for you next to the food court at CES if you guys want to do it. So we did CES, but I told Mike, I was like, I think there's like another, like a corporate gift show. That's like the same. In Las Vegas, because I heard about it from a guy. And so we got a booth at PPI. So we, we had no money. We booked like CS early on. Uh, we stayed at Circus Circus for like $300 a night, which was like the worst experience of my life. So I flew in and we hired, it was me and Mike and we had a couple of our buddies like come out and just fly and like put on suits, like work the trade show booth. We didn't wear suits. And then I flew back home and then Mike went to PPI. To set up on like that Monday or whatever. And I flew in Monday night. I like called in sick from JanSport. Sorry if my JanSport boss is listening. I called in sick. Um, got on the show floor and we just had, we had one product, our like folding speakers. And we had like a 1,000-piece minimum, like 6-month lead time.

Good luck with that.

And like our booth looked, we set up like a living room. We actually had like a goldfish in a fish tank. So I get to the promo show or no, I came, I missed the first day. Because I got to— we moved from— this is a long story, but we moved from Circus Circus to the Excalibur, which was like leaving like Motel 6. Carlton, right? I remember I walked in the room and Mike's like face down on the bed and there's like business cards all over the bed and he's in the pillow. And I'm like, I didn't get a hold of him. Like, Mike, what happened? Like, what happened today? And he like looks up from the pillow, like looks at me. He's like, it was awesome. I went to the show the next day and I saw like how much buzz there was about like folding speakers or whatever. And we like prototyped the rocket that we took on Shark Tank and we had had it at the show too. And he's like, it was unbelievable to see people's reaction of us, like sticking the rocket in like a Styrofoam cooler. And we knew nothing about the industry. Right. But it was such a good experience. And like the industry, like the people in it coming from like retail before, like CES was like, like corporate suits, like pro industry people, like drinking beers, like dropping their, like blowing their minds by sticking a vibration. So it was amazing. And like it paved the way for the next decade-plus of experiences within the promo industry.

So sorry, it was a long answer, but no, I remember, I just remember you were that, you were that entry into the event where people said, hey, have you seen this? Our Org Audio guys, you've got to go by and see them. And then I remember your selling style distinctly, Jason. It was like, here's our really cool shit, you can buy it if you want.

Yeah.

And it was such a self-deprecating style. And it was, it was, it was awesome.

That's how I still am. Like, I feel like I'm a bad salesman because I tell the truth. I'm like, if you want to buy it, cool. Like, if not, like, go buy a burrito. Like, do whatever you want with your own money, right?

Take us back to Jason Lukash the day before he hits the expo floor.

And did you know—

it's this kind of ridiculous question, but I'm asking it for a good reason— was your dream— did you ever envision that you would sell Orgaudio at what you did and where you're at today?

No, no. Like, it started as like a side project, honestly. Like, right, we were— Mike and I had speakers that we traveled with for events at Jansport, and they sucked. And we're like, let's just create like some— and like, there was no speakers built in the iPod, or the iPhone didn't even exist, or it did exist, maybe there was Gen 1, but there's no like external speakers. So we're like, let's just make some speakers that were easy to travel with and like see if people want to buy it. We'll invest like $30,000 was what our startup cost was for Org. So let's, let's just like roll the dice and try it. But like, no. And I honestly, like, I didn't think we would be a promo company. We were retail. We catered towards retail. And then like after that first year of PPA, I kind of like, you know, I walked the show on like Thursday or whatever once it was a little dead. And I just like kind of surveyed the industry and said like, dude, Mike, this industry is like super old school. Everyone like us has really high minimums. Like I feel, I think if we could develop something and kind of like do the opposite of everyone else here, we'd be wildly successful. And we did that. It took like a year or two. And then we came out with like the no minimum, no setup, full digital, 5 days thing. Like that was like, yeah, yeah. Well, and the industry was like, what? I want to order 1,000. I'm like, you can, but we're going to print them in Southern California in 5 days or less. And that was like, that was the major pivot point for Org.

And it's so amazing because Jason, I mean, you've shared with us in the past that you guys came from retail where high minimums, long lead times, big orders, also crazy bad terms for you too are also kind of the norm. And you're such an interesting success story because you left all that behind, right? All that retail nonsense behind, came into promo, but took this retail mindset and came in and disrupted this industry. And it's a really cool story. I remember you talking about some Target payable. It might have been Target.

Bed Bath Beyond was like—

And it was like 180 days or something like that.

And it was crazy. Yeah, it was like a million dollars cash. And I was like, dude, Mike, this is not worth it. It's our money. Why are we financing an owl and bath store? And then it was honestly like the great migration. Look, I live in California, like the Gold Rush. People left the East Coast corporate retail and went west, and it was the Wild West of like promo. And like, yeah, it was such a good experience and it was so ripe for picking at the right time, you know. Yeah.

So Jason, we've spoken about you being— you and Mike being these sort of shaggy-haired rebels, you know, sort of California surfer dudes that got into this space. You know, we spoke about this idea that when you sold to Aurigadio that some of your biggest, most diehard fans kind of accused you guys of selling out, selling out to the man, so to speak. And I must admit, I was one of those people. My initial reaction was like, "Oh my gosh, Orogadio is dead." No disrespect to Hub. I mean, Hub, of course, was a pen company at the time, and the Flemings were phenomenal operators, but it was like, "Where's the synergy here? This just doesn't sound right." And you've proven all of those doubters, including people like me, totally wrong because you came into this organization and it's almost step by step methodically kind of just put the Jason and Mike touch on this large kind of unwieldy organization. So can you talk a little bit about proving the doubters wrong and how it is that you didn't really sell out to the man, so to speak, and how you made this work on your terms? Because I must admit, not every entrepreneur is able to do that. Most entrepreneurs will just take the money, they hold their nose, and their baby gets killed, and they move on to, you know, the beach. You didn't do that. So talk to me about that. I know it's a multi-layered question, but I'm really fascinated by it.

My whole life, I've— I love proving people wrong, right? And like, I love the challenge of that. And that's like no bullshit, like I honestly do. Like, I love just like someone's like, you can't do this. I'm like, I probably can't, but I'm going to. I'm gonna make you eat your words. And so many people, like, over— it's been, we sold, what, like 3 and a half, 4 years or whatever since we sold to HPG. So many people along the way are like, I can't believe you're still here, I can't believe you're still doing this, I can't believe you and Mike didn't ride off in the sunset. And Mike's also got the surfer hair. I'm like slightly losing mine. But, um, we stuck through it because we care. Like, we care. Like, I cared about every single of the 120 different products I made and created over the last decade. Like, I cared about every one of them. I cared about even like what they were named. Like, we would spend months on like naming a product, which like people just use item numbers, which I still think is ridiculous, but we cared so much and like we wanted to ensure this was done proper. And Hub at the time was the suitor we went with because we could do the exact same thing with the brand formerly known as Hub Promotional Group with a bright red lettered sans-serif logo. And I said, if I'm going to be part of this thing, I want to flip this thing as well too on its head and do things a little different, which we had. And like, I've got to birth businesses and categories at HPG, like Batch and Bodega. And like, we have, you know, Sugar Spot here coming out in a week, which was— we showed at Vegas, which is like our candy thing. But I like the challenge of that too, of like taking this like red old school pen company and making it a force to be reckoned with, you know, a top 10 supplier within the industry and kind of put our own special sauce on it as well too.

Yeah, I mean, I love that answer. I think at the end of the day, you, you were kind of at a fork in the road a few years ago. Could have just gone and retired to the beach, so to speak, or you could have raised hell within a pretty traditional yet very well-operated company. I mean, I don't know whether that's the right way of putting it, but you kind of know what I mean. But I'd say you're kind of going in and you're a little bit of the bull in the china shop. I'll give credit to Chris Anderson as this very steady, great inspirational leader who's got a lot of operational experience. That he allowed you to be that bull in the china shop. I mean, I think that Chris probably ensured that the china didn't break too much. Maybe gave you your space so you could go a little crazy. But at the end of the day, I think that that relationship and that synergy between you and Chris is really quite interesting and something that I've seen. I've sort of watched from the sidelines with fascination over the last couple of years.

So credit to both you and Chris. [Speaker:BRYAN LAWRENCE] Yeah. I love Chris. Chris is a big reason why I stayed here. And look, I actually brought Chris to this party. And big fan of Chris and I, yeah, he's like, yeah, I guess the bull in the china shop analogy is good. I was trying to think of a better one. He's like the ringmaster in the circus. And I'm like the lion that is in the cage, like trying to break out of the cage constantly, but like, like, whoa, whoa, stay in your cage, lion. We don't want to get eaten today. And it's hard within a larger enterprise, like 1,000 employees or whatever, being that innovation guy, but also like trying to figure out how to innovate within different silos and different cross-functional leaders and categories that I wasn't familiar with. Like Chris and HPG did a good job, like allowing me to do that. And like Batch and Bodega was honestly like the first innovative or business unit that was birthed without just with it. Everything within HPG was always like siloed, right? Like individual companies that were brought on and then another individual company. Batch and Bodega was the first like cross-utilization of teams and a first product launch or business launch. By utilizing teams in different facilities or across the whole enterprise. So, and we launched it during a global pandemic, which blows my mind too. But yeah, Chris did a great job kind of like being the champion for innovation and just Team Jason Lukash for many years.

Speaking of the role, Batch and Bodega, all these different roles you've had— startup entrepreneur, founder, CEO, Senior VP of Marketing, investor, category creator. You've developed over 120 products. You've managed teams of over 100 people, budgets over $25 million. I mean, that's a lot of different hats to wear for a guy who walked into the show going, I hope we sell some of these speakers. Of all your roles, which one challenged you the most and which role and experience was the most rewarding?

Why? Well, the truthful, heartfelt answer is the one that's not listed, which is dad. I mean, you guys know, right? Like that's the most challenging thing I've ever done, but it's also like the most rewarding thing I've ever done. And like, I wanna be there for my kids and that's like the most important thing. But anyways, but back to your like business question. Yeah. CEO, because like I became the CEO and I was the CEO cuz I started it. But hardest thing is like managing people. And when you're CEO, you guys both know this, right? You have to wear like many different hats and like You wear hats too. You're not necessarily good at like, yeah, default in charge of operations. I'm not an operational guy. Right. Like, I mean, now I know a lot about operations, but like, I wasn't an operational guy at HR. Like I hired people at Jansport and like had interns, but like, I didn't think I'd have to hire like 65, 75 people, 100 people, however many people at our height and like manage and deal with 100 people and like Finally, as CEO, like you actually end up becoming the ringmaster or whatever you want to call it. And you're, we end up investing in the right people to help in their respective categories. But the hardest thing I had to do was be CEO because you're default in charge of things that you necessarily aren't in your wheelhouse. And I think that's really hard to do. And as a CEO, you kind of have to grit your teeth and do it, but I'm not a CEO, right? Like I'm a creative. Product marketing innovation guy. And that's what I liked about HPG. I fit perfectly in my own wheelhouse and Chris had to deal with the rest. So I had to deal with her thing and the COO did. So it was kind of cool because I fit perfectly where I should be.

Jason, what's the most surprising thing you learned about yourself as an entrepreneur or a business person during your time at HPG in the last couple years?

The hardest thing, or the thing I learned the most about myself was for many years at Org, I did what I wanted to, but I didn't actually really get to do what I wanted to. At HPG, I got to do it exactly what I wanted to, which was create and be creative. But I also learned that the flip side of it, I'm a big baseball guy and I use this analogy all the time. I'm like the starting pitcher for a baseball game. I'll go out and throw like 5 or 6 solid innings. And then they bring in like a middle reliever and a closer to like finish out the game. And you like, You start it and you've got the lead going into the 6th inning, but then you pass it off to someone else. And sometimes that person closes out the game for you. Sometimes that person gives off a walk-off home run and you lose the game. The hardest part in creating and innovating is you can only take it to the creation. And then I'm not an operator, right? In our business, you pass it off to the operator to operate. You pass off to the finance team to do their part, IT part, like I can only come up with the idea. I can actually, I can bring the idea to life a little bit, but it's up to the rest of the team to bring it to life. And like, that's hard because you don't win every game you start out there pitching. And I'm constantly pitching ideas and some aren't fit for HBG, you know, some are fit in other industries. Some are just not ever possible within HBG in the current, because it relies on other teams to help, you know, get us across the finish line there. So That's, that was quite hard. And that was something I learned because before, hey Mike, should we do this? Yeah, we should do it. And then like we could do it because we were very nimble because we were a small company. It was our own funding. But when you have lots of other cooks in the kitchen, everyone wants to kind of give their input on how recipes are made. And that's not saying anything bad about HBG, just that's how it is in any big company. But I never had to kind of learn and adapt with that before. Right.

Yeah.

No, no, I can imagine that. That's surprising and probably frustrating and humbling all at the same time going through that process.

Yeah.

Tell me if there is any— I know that you were really ambitious in terms of the kind of work that you had set out to do at HPG a couple years ago. Is there any project that you wanted to complete that you just never had enough time in completing it? Or maybe another way of answering it is like any project that You tried to launch and it failed spectacularly, right? I mean, you can answer that question too.

Yeah. Well, I can't specifically say what the project was, but I was working on it last week and there comes a point in a project where it's like, can we actually bring this to life? Yeah, we could. But like at the expense of what, what expenses would we have to incur as a company in order to bring this live? And is the juice worth the squeeze? And you decide when you're working on a project, like can't always hit grand slams. And even at Org, we had a couple major failures of products, some disaster stories, right? But we had a pretty good batting average, right? And at HPG, I had a pretty good batting average as well too, again, using a bad baseball analogy. But yeah, there's some projects where this would be perfect for HPG, but there's other factors at play, right? Is this a 3 to 5 year project? Does this require $20 million of capital invested in it to bring it to life? Like at what point do you say, and Chris and the rest of the board and everyone, like, is this project actually worth it for the long-term horizon of the company? So yeah, I still have some amazing ideas. And like the cool thing is like I'm still on the board for HPG so I can help and make sure those ideas come to life somehow directly and indirectly, but Some things just aren't right to be launched and some things never will and they end up in the product and idea graveyard.

Jason, you had a chance to work on a bunch of different brands within the HBG portfolio, and I'm curious as to which brand revamp of an existing company within the master portfolio you're the most proud of.

Let me answer it two ways. The easiest one, because It was pretty rough how it was before, was Web Company transformed into Mixie because like the branding they had for web was just, it was, it was just bad. Right. Um, so when, like, when we actually bought it, we're like, dude, we could really like change, give this thing a facelift. So we did. So that was the easiest, but I'm most proud of Hub because it was so delicate. It was 70 years of history that like, we didn't want to mess up. So when we rebranded Hub, even though it was Hub Pen and we just dropped it to Hub, but like the whole branding, look, feel, website. Everything. So many loyal customers, like on day one when we did it, like, but their pens are kind of old school. Like some of the customers, people are like, what is this? There's like way too many options on here. You can like see a 360 image of the pen. It spins. Like I can change, like they weren't ready for it, but I'm super proud of like what we did there. And we like preserved so much history and like legacy and like the foundation that was laid for it. And like, I headed that up, but like, honestly, like I hate this and like, I've gotten this for years. Like I hate getting all the credit, like to my squad, my team here, like in the Bay Area, like our Casey, our creative director, Ben, who's my marketing director, like Campbell, Marissa, Jeff, like everyone who's on our team brings that shit to life. And like, I'm just the guy that has the initial idea, but again, I'm the starting pitcher. You need the rest of the team to help win the game for you. And, but the Hub one was like pretty amazing.

Yeah, yeah, yeah. No, for sure. And I will, going, just going back to the web example, I just as an outsider to, to the hub looked at what you did with Mixie, and at first I was like, wow, I, this is crazy. And then when I looked at it, you know, I just looked at a little bit more detail, it just was, it was so amazing as to how you just simplified the web value proposition and just brought it all together and Sure, it's cool and it's sexy and fun, and Web had very traditional branding, and just how you simplified the value proposition and made it fun, and then you can cut through the noise with great branding and product positioning. To me, I'm like, and I have such great respect for that. I just remember just clapping my hands going, man, that's a great job, Jason.

[Speaker:JASON_WEST] Well, thanks, man. We looked at their fundamental core value, which was they literally were mixing stuff. They were making lip balm and stuff from scratch. And Just market your core. All the other stuff was just fluff and web company is just a name. Stick to your core and let people embrace and acknowledge your core. So that's what we did. But thank you.

That means a lot. Yeah.

No, no, no.

I mean, I'm telling you the truth. So I want to talk a little bit about HPG and the power of their balance sheet. So you at Orgaudio presumably had a smaller balance sheet. You come to HPG and they've got private equity backing and a lot more financial infrastructure to be able to support. Talk to me a little bit about how that benefited you in terms of launching new products, but I also want you to talk to me about how it held you back as well. So you talked a little bit about managing multiple stakeholders. And so I imagine it's a double-edged sword. On one hand, it's, hey, we got all this cash, but on the other hand, you're like, well, you've got all these dour board members that you need to do ROI analysis, whereas before you and Mike were just Shooting from the hip. So talk to me about the good and the bad there.

So the good, for sure, we launched a business with time-sensitive product, Batch and Bodega, meaning food expires and we weren't making the food. Batch doesn't make food. We buy, and people know this, we buy from the best makers across the country, bring it into New Ulm, kit it together and send it out. But we launched a product when, or we launched a brand during a global pandemic when the business was hurting dramatically. Right, just as the whole industry was hurting, and they said, we're going to buy inventory and a lot of it for product that will probably expire in 4 to 6 months. So thank you, HPG team, for agreeing to do that, because if it was Jason, like, there's no way I would have rolled the dice on like our little balance sheet instead of buying like core competency product, box hands and headphones and everything that we sold. Yeah. I would have bought food that could have expired if it didn't work out. To the tune of a lot of money. So that was amazing to have the financial backing to do that. But also managing a big company and a big balance sheet, you got to divvy up the funds. You got to invest in people. You have to invest in— we did a huge ERP implementation and had every one of our subsidiaries on NetSuite, which takes a lot of time and money too. So you got to divvy up that money. So not all that can be put into innovation, As much as you want to keep throwing fuel on the fire to grow the fire bigger, you got to spend where else is needed to ensure that the wheels still stay on the car. So that's also the bad part is there's a lot of money, but it's not always all going to innovation. We have to support other aspects of the business, which Chris and Kim Hayes, our CFO, had to do and make sure, and the board, make sure the money was spent accordingly. But having them invest in Batch and Bodega during a global pandemic when we were down whatever percentage, amazing.

Yeah. Jason, HPG has such an aggressive growth plan, which includes acquiring or developing some of the most notable brands in the business—Batch Bodega, BCG, Beacon, Best, Debco, Handstands, Hub, Gaudio, Mixi. You learned a lot of lessons. Both of you guys know this, but you learned a lot of lessons as the acquired company after the acquisition. Jason, now you're a major shareholder and you're sitting on the board and you've been a part of probably these processes from the other side of the table. Speak to that supplier who's sitting in an Aurigaudio. What have you learned as the company who now, who's doing the acquiring?

I learned so much from selling my business. I learned more in like the 6 months that like we were for sale, even though we weren't for sale, like we got multiple offers from a couple different companies, but like I learned so much about my business that I didn't actually know. Like what? Give us an example. Just like the main, like financials. Like I was an economics major, like I'm a numbers guy, like, but I didn't actually like pick apart and learn about add-backs and valuation based on EBITDA and earnings and long-term. Mike and I, we put together a budget, but we didn't put together a 3-year budget or a 5-year budget. We barely put together a 5-day budget. So I learned so much about the whole process. And interesting is working with Chris and the rest of the team, as we've had acquisitions at HPG, what to look for when evaluating business has been such a cool amazing experience where I've done investments on my own and I've used what I learned at HBG to invest in a lot of real estate, farmland. I've angel invested in a couple of businesses. It's cool to put on the M&A hat from the other side that I wouldn't have learned about unless I sold my company to a private equity-backed company.

[Speaker:TREY_LOCKERBIE] I don't want to go too far down this path, but what do you look for? Are there a couple of key markers for you?

[Speaker:IAN_CASSEL] I'm a big component of you bet on the jockey, not the horse. So the people in the saddle, you got to invest in good people and the the right people because like the horse could eventually run its course, right? Like after like 3 years of, I guess now I'm using a horse racing analogy after like 3 years of racing, but like the jockey's probably going to have a storied career and probably like switch horses multiple times. So bet on the person, right? So like I've done that in a couple of the investments I've made and that's been great, which is probably also the reason what HPG saw in like Mike and I, they bet on the jockeys, right. As well. But that was a big one. And I, I love sectors that lack innovation because like if there's a business that's doing something differently in a category that lacks innovation and they're innovating a little, imagine once you get like the right people, uh, behind the jockeys in the race, like they're only going to help like actually grow that thing even faster as well. Yeah.

I want to talk about the distributor side of the business and Jason, you've, you've been a supplier your whole time in this industry. You've worked with a ton of distributors. Let's say you were to come back as a distributor, how would you differentiate yourself? What kind of distributorship would you start knowing what you know now about what separates the good ones from the bad ones? [Speaker:IAN_CASSEL] Yeah.

What's interesting, and I'm sure you guys have seen this too, is I noticed this at PPAI, I think COVID weeded out a lot of the riffraff in good ways or bad ways. But if I had to come back as a distributor, I would come back as a full-service value-add distributor because No offense to the promo peddlers, like the promo peddlers, like the, hey Johnny, you want to see like the new latest and greatest, dumps the suitcase on the table today. Like I've run into a bunch of those just as you guys have over the decade. Like what's the value add? Like if I'm a buyer at a corporate entity, like, and I'm buying swag, like what are you doing for me? I think the distributors that also cater towards the new buyer profile, which is like, I'm like a millennial, but like I'm on the cusp, like catering towards like the millennial that wants to make like quick decisions, doesn't want to like come in and see the latest and greatest once, like a really like curated Pinterest board sent to them or like something that's like a little more catered towards their demographic is gonna do better. So I'd probably figure out like what additional value add can I bring besides just promo, whether it's like maybe building online stores or like merchandising strategies and like brand direction or graphics or whatever else it is. I would do that. And I would really like build my whole business around the person I'm trying to sell to versus building the business for how I think it should be built.

Now, Jason, when someone exits a business or an industry, they typically find a lot of boldness in their opinions because there was little to no implication, right, for when they're leaving. We all know this, but most people live a life of careful reserve about their strongest opinions. But you've really never withheld that. I mean, you've always been a pretty even-keel but opinionated person. Is there a topic or a question that we can address here on your way out that you haven't talked about that you wanted to?

Jeez. Um, this whole thing's been like just super weird, by the way. Like, just like leaving and you just like don't know. I mean, look, we're doing this— this is Monday, February 7th or whatever. Like, this is going to be aired later. Like, no one even knows this is happening yet. So, right, it's just like people say nice things about you, which is weird, which I was saying earlier. Like I don't know. There's no topic that's like off limits and like I'm an open book, as you guys know. But the whole thing's just been— it's just weird because it's new.

I think there's an answer there. I think it's just, it's a strange feeling to be suddenly leaving something you invested so much heart and soul because you— that's the thing. That's why it's weird because you, you know, it's one thing if you just cashed your check and went home and you'd been, I won. But then you have all these other emotions that are tied up with this. That's why— that's what makes it weird, I think. Um, weird in a cool way.

I think the unknown is what makes it weird too. Yeah, like, I'm 38, I got a shitload of fight left in me, right? Right. It's just like, what battle do I want to fight in, right? What do I want to do? And like, I don't know, you know, like, I want to spend time with my kids and my wife, and like, I'm a big biker, like, I want to bike and like do all the things you couldn't do. You guys know this, like, I want to like flip more houses, I want to like patrol the streets of Danville with my dad on Friday nights in a police uniform. Like, I want to make kids toys. Like, whatever it is that I come up with next, like, I want to be able to do those things and not like stress about a 9 to 5, 40 hours a week, and having so much pressure on like coming up with the latest and greatest. I want like freedom.

I don't know. Yeah, I think it's great that you discovered this moment, Jason, before you started to resent it. Because this is not a financial thing anymore. This is about lifestyle, it's about freedom. And if I recall a few years ago when we were— Katherine and I were selling Right Sleeve, it sold it at a time where we still loved that business. And I still love the distributor business. And in many ways, I feel we run CommonSku almost like a distributorship in terms of how it is that we think about promotional products and all the products that we do for ourselves. But I always knew that it would be such a crime. I don't know if that's the right word, but it would just be so unfortunate if we got to the point where we started hating Right Sleeve. And at that point, your mindset is like, just get rid of this terrible business. And we were the exact opposite of that. We just loved, loved, loved what we were doing, loved the people, and knew that it was an incredible opportunity for us to move into the software business that we had started years before, and it was an incredible moment, and it was emotional, it was sad, and all that stuff, but there was no resentment. There was no, like, I hate this moment. And it sounds like you're exactly the same way, whereas maybe if you'd stuck around for another 2 years, and then at that moment you'd start resenting, your kids are getting older, and you're like, I don't care about the money, but I hate this. And then you're the grumpy guy who shows up at Expo and you're like, really upset in the booth. And it's like, "Oh, Jason, remember he used to be happy? What's wrong with him?" Who's that upset rich guy over there? Right?

Scrooge McDuck sitting there in his pile of money in the corner. Yeah.

Exactly. So anyways, I just wanted to share that experience, but that was just more of a comment.

And I salute you for that. It's exactly right too, because do I still have the twinkle in my eye that I had for many years? I don't know. It twinkles in a different way, And I love Origadio. Like people, what's hard is like, I haven't actually been involved in Origadio for probably 2 years, right? Like, um, since like after COVID we shut it down. Like I kind of like moved into the chief development officer role at HBG and like kind of like did things a little differently. Mike was like the face, Mike was on the front lines of Origadio every day. But like people still like, they can't get ahold of someone or like, I'm still like in distributors, like phone systems to check inventory. I'm like, We got a lot because I don't even have access to like, I didn't have access to whatever, but like I cared. Right. And like, I, I didn't resent it. And I, yeah, I think you're the right sleeve analogy for you is like exactly kind of me too. I didn't want to be that guy like 3 years from now and be like, man, I hate this. I hate this industry. I hate these people. Like I'm going to sit here in my kiddie pool of dollar bills in the corner of the booth and just watch, you know? Because like, I love, I mean, you guys know this, like our industry, the people are like amazing. And there's also the people that, the grumpy people, little expo Mark that show up and you're like, man, what's Mark doing here again? You know? But like our industry is like all about people and the suppliers that do well. And you guys know this, do well in this business are likable people that take care of the distributors. Cause we're only as good as each other. And like, Benchy's been so good to me. And there's so many amazing people, like friends forever. Like you guys too. People I've met in this industry where like I will stay in contact with no matter what and hopefully check inventory for something 10 years down the road from now, even though I don't know how to, just because you want to help get you to the point where you are today. So, right.

So Jason, I want to, I want to zoom out to 30,000 feet here and I want to talk a little bit about the industry in the last couple questions here for you. So what do you think is the biggest threat to the promotional products industry based on what you've seen over the last 13 years and particularly over the last 3, 4 years being with one of the larger suppliers? What do we have to worry about?

Ian Formigle: Well, I would've said COVID, but COVID hurt the industry, but this industry's pretty resilient and that's what I learned during COVID is like, and this industry can pivot fast. Look at all the influx of capital that came in, in the form of like PPE, Like the pro industry is so good. Like, it's like right when you couldn't get COVID tests anywhere, like immediately, like every promo supplier selling COVID tests and like, yeah, you pivot so quickly. Like this industry has been solid for what, since like, I think Kirby Hasselman like told me it started in Coshocton, Ohio in like the 1800s with campaign buttons. Someone would have to verify the source, but this industry has been around for such a long time and continues to, and that I think is like super, super promising, but On the flip side, this industry lacks big time in doing, or this industry keeps doing things the way it's been done forever because it's safe and safety is a bad thing. Right. So unless you can embrace change, like do things completely different and think of new ways and don't just keep doing things the way that you've done it before, just for the sake of doing it, like that's a threat to the industry. And. Everyone talks about consolidation, like consolidation is consolidation that happens in every industry, but keeping stuck in your ways is not a good thing. Right. And I think the industry needs to continue to evolve. And I think Dale is the right guy to lead PPI and Tim's done a great job at ASI and you guys are on the kind of like the new, I'll call it the neutral party front have done a phenomenal job too. I think there needs to be more of a neutral voice for the industry as well too. But the industry's resilient and the disruption that happens is amazing. And I hope to God that there still continues to be major disruption in this industry because it's what changes the industry for the better.

How about the flip side of that question? How about the biggest opportunity for the industry?

I think technology, honestly, this isn't a Commonsku plug, but tech is going to change this industry because We still get orders like faxed to us, like hard—

like what?

Like why? It costs us more money to figure out how to process that order than anything else. Like technology hooks, like company web stores, POD. Like I'm a huge fan of print on demand. Like I consider myself a mass customization print on demand wizard and like print on demand and the ability to like go quick is awesome. Like I'll tell you, 5 days. Production, that ain't fast anymore. 3 days production, that's not really that fast anymore. Like same-day flips from multiple facilities across the country, like 3D printing on demand, like the Amazon approach of having it delivered within an hour. Like that's going to change the way this industry operates from an, like an operational product delivery perspective. Should have drones start delivering promo products. Like I think technology is going to change this industry for the next decade to century, and I hope it happens really, really rapidly. We think you're right about that. I hope so. If you did, I don't know who else would.

So we flirted with this question a little bit before, Jason, but, uh, do you think we will see you again in the promotional products industry, and if so, in what capacity?

You never say never, right? So Yeah, like this industry, it's a people-first industry and I love the people in this industry. Like there's so many just like good genuine people and just like so many hilarious people. Like I will just name drop, like the Kevin Mulaney, you don't find a Kevin Mulaney in any other industry, but the pro industry, he's an original for sure.

Right.

Or the Kirby or so many people on that list that like you come back to work with good people in a good industry that is good to you. So I don't know, but like family first and getting the ability to just like think and breathe and think about like the next complex problem I want to solve is probably what I will do next. But will it be in the pro industry? You never know.

What a great way to end it. Yeah, great. Jason, man, thank you so much. Thanks for breathing so much fresh air into this business and this industry. You've inspired so many. I know I speak on behalf of many of us, and I know it's hard for you to take, and it's a little awkward and strange, but man, it's been an honor and to be a part of your journey in a very tiny way.

Well, thank you. It means a lot. I've cried, I've laughed, and I've learned things in the last couple of days. And I appreciate you guys having me on and having this be the platform to share my message. It's not like something bad happened, but just share the message and preach the truth like I've always done. And I appreciate you guys having me as always.

Thanks so much for tuning into this episode of SkewCast. Be sure to keep up with our latest content by subscribing to SKU Cast on iTunes or to our blog at community.comandsku.com. Until next time, friends, thanks so much for listening.