Episode 84: How Failure Drives Success with Joseph Sommer of Whitestone Branding

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I think the greatest experience through it all was just the failure of it. I received in the 18 months a master's in entrepreneurship that I wouldn't have been able to get in, in the classroom. And I wouldn't trade that for anything.

Joseph Sommer is the owner of Whitestone Branding, a boutique branded products agency in New York City. At 29 years old, this is the only career he's ever known. And in 2017, Whitestone Branding was listed at number 706 of Inc. Magazine's list of the 5,000 fastest-growing private businesses in the U.S. And it was my privilege to sit down with Joe and talk about the trajectory of his amazing growth that came through several critical lessons, one of which was acquiring a screen printing and embroidery company that he ended up closing. Joe talks with us about the gift of failure, and how it has shaped his success. This episode is brought to you by Commscue, the effortless business management platform that powers you to process more orders and grow your business. To learn more or to start your free trial, visit commenscue.com. And now my conversation with Joe Sommer of Whitestone Branding. Joe, you're based in New York City, and in 2017 you did about $2.7 million. What type of business or verticals do you specialize in?

So when I started the company, we had a lot of luck selling to financial services companies, being that we're 3 blocks from Wall Street. But in the last 12 to 18 months, we've shifted our focus and we started working predominantly with experiential marketing firms and event production companies. We just found that it's, it's much more fun. It allows our whole team to be creative. It's much better than just slapping a logo on a one-color logo on an umbrella.

Can you explain how those projects differ?

Absolutely. I think that the experiential marketing companies have challenged us to be different. They've challenged us to be creative with our decoration capabilities. They've challenged us to deliver in crazy, unrational turnaround times. And we're not being asked to just put a logo on an item. We're asked to create something. And that's really, I think, what, what our team is, is loving the most about working with them.

It really stretches and challenges you and your team.

Absolutely.

You know, let's back up a little bit. You're 29 years old.

Yes, sir.

How did you get started in this?

I wanted to own restaurants growing up, and I was, I was fired from a job as a chef because in senior year of high school I wanted to go to Beach Week. And so my plan was to work at a restaurant all summer. And I went to summer camp and I met a guy who, he was running his promotional products business from his BlackBerry. And his largest account at the time was Tequila Patron. And I saw all the cool stuff he was making for them. And at first I was just super curious about this guy. One, because he was ditching me with all the kids taking calls all the time. And then I saw a six-figure check and I was like, all right, what are you doing, man? What, who are you on the phone with? What are you making? What are all these boxes that are coming to camp? Right. And I was hooked. I just started asking a million and one questions.

When was this?

This was summer of '07, so like 10 years ago. All right. And then, um, yeah, I just started building my business plans in college right after that.

You hit the Inc. 5000 list in 2017. So from that kid that was heading out to Beach Week 10 years ago, 10 years later you hit the Inc. 5000 list in 2017. You've seen continual growth. What do you attribute this growth to?

That's a great question, and I wish I knew this answer, you know, 10 years ago, but it's certainly been our people, our process, and our product. Bobby, I've got a great team. They're all all-stars. I'm lucky to say that they're all passionate about what they do. I think they love coming to work every day. I think collectively we've really started building this business together. One of my favorite entrepreneurs is Marcus Lemonis. If you watch The Profit on CNBC, he always talks about people, process, product, and I believe it. Our process is different than what it was 2 years ago. We have an ask for every seat. It used to be the salespeople would have to manage their sale from start to finish. So they would have to manage the supplier, fill out vendor forms, follow up for tracking. And that really slowed everyone down. So the process and, and having, you know, a production specialist, a finance manager, a creative director really has allowed the salespeople to go out and sell and do what they're best at.

I also suspect you have refined who it is that you serve, the types of clients you work on, and that may have also had a lot to do with your success.

Absolutely. And in fact, we, we've started firing so many clients You know, I think in the beginning, you know, being a young kid hustling out of an apartment, I was going to take a sale from, from anyone. And that set us back. And that, that was a huge challenge. You know, one, who do you sell to? Everyone and anyone, but not having, you know, I don't think it was a company really 2, 3 years ago. I think it was really just my hustle, so to speak. It was an LLC, you know, and once we really put the right people on the bus, you know, only then could we start really figuring out what this actually is and then start really driving growth forward.

It almost sounds like you've had this professional development experience growing from a salesperson, which is— this is very typical in the industry— to becoming an entrepreneur, to truly— from, from everything being centered around Joe and his activity to proliferating you, your brand, and what you stand for through your team and alongside your team.

Yeah, you know, it's absolutely— and it's funny you say that because I think it's a journey that I set out about 2 years ago. I said, I want to transition from being a great salesman to a great entrepreneur. And I sort of realized that I was not going to be able to grow this business. I maxed out, I maxed myself out. So, you know, in my entrepreneurial journey, it was okay, you know, let's, let's find and create new skill sets. So yeah, and, you know, finding mentors and immersing myself in entrepreneur groups and really going back to school, you know, was, was part of that.

You went through the Goldman Sachs 10,000 Small Business Program, and I believe our awesome friend Renya Nelson with Brandaid also went through that program. How was that beneficial to your development as a professional? How do you think that's impacted your business?

I attribute a lot of what I know to that, that program. It was instrumental. It was like grad school for entrepreneurs. It's a 15-class, about 6-month growth accelerator where they teach you everything, everything about what a business owner needs to know about. They really give you the tools to grow your business. I was not smart before that. And, you know, still, I don't think I'm smart totally, but that That class did a lot for me, and I recommend any entrepreneur who is looking to grow themselves to apply to that, that program.

You know, let's talk about your team and philosophy for sales for a moment. In Advantages magazine, you said the best way to retain sales reps is to hire people who never meant to go out and sell. Then you focus on growing them. We don't do one-off orders here, so we have to go out and find long-term relationships. The best salespeople aren't actually salespeople, they're relationship managers. Now, you presented at SKUCon a few years ago and very bravely talked about your recruiting lessons and challenges learned through hiring salespeople. So now that you've gone through this journey of everything through Joe and then maturing professionally to this point where you realize you need to replicate an experience through others to gain substantial success, what did you discover along the way that didn't work?

Yeah, uh, that's a, that's a great question. I think my biggest mistake was my first hires were salespeople. You know, they always, you know, now I've learned, you know, hire your weakness. And so my strength is sales, right? I can open doors, I can start relationships. But my weaknesses have always been organization and process. So I should have hired operational and support team. And as it relates to failures hiring salespeople, the mistakes I've made and have done it multiple times is I've hired people from an interview that say they want to sell, they want to hit the pavement. They want a cold call. And then, you know, you introduce them to this industry where you can sell all things to all people, uh, and they just haven't found success.

Right.

And, you know, when I got in this industry, I didn't— I wasn't really trained. It was, you know, eat what you kill. And I think that was my mentality was with salespeople is that, you know, you can sell to anyone. So, you know, why aren't you building a pipeline? Why aren't you closing? And so only through hiring operational, operational support people did I see that once you teach someone the industry, once you teach someone how to talk to suppliers, how to build presentations, how to put out fires, you know, only do they gain the confidence to then be able to transition into a great project manager. And so I think in part now what we do and what we try to do so well is put our arm around our people's shoulder, teach them the industry, and, you know, give them the vote of confidence that what they're doing is, is right so that when they get clients, you know, they can effectively, you know, kind of manage the intricacies of the sale, so to speak.

Yeah.

So, you know, Biggest regrets were taking the time to invest in my people, and now it's, it's really investing in human capital.

That's a very eloquent way to put it because that is spot on. That was, that was my experience too. The industry is so complex. There are myriad of details. There are so many things to learn that you have two different things to learn. You have the industry to learn itself, product knowledge, and then you have the process and the relationship side of it. And Catherine's really good about talking about those two different halves that are very complex to learn. And You obviously learned that the hard way. Most of us do learn it the hard way because, you know, we want to hire that person that's going to get out and go out and get the sales and go out and hit the ground running. So it's a very common lesson, actually. I think a lot of folks might not really learn that as quickly as you did. So it's kudos to you for, uh, feeling that pain and realizing you didn't want to do that again.

You feel it in your pocket first, and then you realize you need to fix it, right?

Well, what have you discovered along the way is the key skill set? You kind of touched on this, or are there personality strengths?

Is it—

or is this really just a matter of finding good people, bringing them into the organization, investing in them, allowing themselves to invest in the business, and then nurturing them to grow? Is it just truly a matter of building from within? Or did you discover there are certain skill sets or personality strengths of a good salesperson?

Yeah, I think it's twofold. I think they got to have the knowledge of the industry, but also a great skill set that we've discovered is people that have come from the hospitality industry are great people and transition amazingly to this industry. Because, you know, we, we believe that, you know, we're in the business of service and, you know, we need to deliver white glove service. And, and we really set ourselves apart through the handholding and the relationship building we have with our clients. And, you know, very much to credit of the hospitality industry, you know, taking an order at a restaurant or being a concierge at a hotel, knowing that without the customer and without delivering excellent service to the customer, they're not going to be there. And then also, you know, being able to juggle a million things at once, being able to solve problems, and, you know, just kind of being intuitive are other things that we've found to be successful in our people.

Yeah, absolutely. That's so good. Catherine says the same thing about the hospitality industry. Absolutely the same thing.

Crazy, right?

It is. It's an amazing thing once you discover it, because it does help fast-track for you, at least in terms of qualifying folks. And I found too that curiosity is a big aspect to this. Once you get someone in that has that type of attitude of taking care of clients, and then you can nurture that curiosity a little bit, it takes them a very long way in this business. That's why some folks wake up and they're 10 years later, they're like, I'm still doing this and I actually love it.

Yeah. And I think you have to love managing the customer. I think you, you know, yeah. You have to be there ready to deal with, deal with the bullshit, you know, and, and deal with the curveballs and the changes and, uh, you know, being able to, if an order goes wrong, knowing how to handle it. And certainly if you've worked in the food service industry, you know, the steak doesn't always come out medium rare how they asked.

All right.

So how do you deal with that?

Resilience, adaptability, being able to pivot, all of those are such key factors for a salesperson in this business. Huge factors.

Absolutely.

So let's switch gears a little bit. Obviously, Joe, you're very ambitious. You can hear this in your tone. You can hear this in your energy, can feel it. And as you have grown, you were willing to try many different things. One of the things that you tried, you bought a contract screen printing business and ended up liquidating the business after a while. So I have a few questions about that experience because many of us in the business think about this, doing this. Some of them have done it. Can you go back in your thinking to prior to the purchase? Why did you think it was necessary to buy a contract screen printer? Was this because your current providers weren't responding? You didn't have the right network. You felt you could be more nimble. What was it about the need for that that drove the purchase?

Um, American Icon. So, um, I think this is a big chapter of my professional development. Yeah, in September 2016, we acquired our go-to screen printer, and then we financed, uh, 15 heads of embroidery. What a trip that was. So my intention for buying the business was to grow Whitestone. It was to shorten lead times, it was to manage quality, and also to, you know, apparel makes up 33% of the pie chart in this industry. So I thought if I can grow that, well, you know, I'll certainly grow my business. But I've always believed that it takes the same amount of time to sell 10 t-shirts as it does 10,000 t-shirts. It's the same process, right? So I thought by buying this business, It would give me the leverage and position to go out and hunt those, those large volume sales. And we did that. We got large sales in the business, but, you know, put 28,000 t-shirts on the press and in your facility and you've locked up your whole production for 2 weeks. So, you know, boom, that theory goes out the door once you, once you get into it. That was really my thinking going into it was that, you know, it could be a growth vertical for us. And, you know, certainly it had, it had its pros, but it had, uh, you know, way more cons.

That's what we always struggled with too. We were always tempted to do that, buying equipment, and it was always that question of what happens when we max that out? We're going to be contracting to other folks anyways. But, you know, I can— what I can really appreciate though is the fact that many folks want to do it because they really just want a fast turn. They will control the process so they can respond better to their customers. I need to verify this number, but I had recently heard through a friend that Scotty at Icebox, who, you know, runs an incredible screen printing facility in Atlanta, once said that to know whether or not you should get into the, the actual printing business, screen printing business, or embroidery business, you should probably be doing about $1 million worth of contract work. Just contract, just on the contract work alone. That was a kind of interesting metric, you know. I don't know if that's a true metric, but it sure kind of makes sense. What was a positive outcome from that experience?

Um, probably the biggest positive was we found through the screen print business that experiential marketing companies were a great fit for Whitestone. What we learned was, well, I should say coming through the screen print company were these fast turn jobs, uh, through these agencies for all kinds of awesome brands. And, you know, just asking the right questions to them when, when we had them on the phone, we learned that they were perfect for the Whitestone side of things. So, you know, that was a blessing in disguise that through American Icon, we really helped figure out what Whitestone really enjoy and propel at. But, you know, it took, it took a lot of money to figure that one out.

Right. I'm sure you're sleeping a little better now.

Oh, I am. But, you know, I think the greatest experience through it all was just the failure of it. I received in, in the 18 months, a master's in entrepreneurship that I, I wouldn't have been able to get in, uh, in the classroom. And I wouldn't trade that for anything. And certainly, you know, I think it, I think it takes that failure to really appreciate what you have. You know, I'm, I'm now, you know, more than ever so ecstatic about Whitestone and where we're at and, and the future. And, you know, I've learned from it. But, you know, one thing I will say to anyone out there who is doing a lot of apparel business is to, you know, not put all your eggs in one basket. You know, at Whitestone, we have a network of contract decorators across the country and about half a dozen in the New York suburban area. You know, people that can help turn 6 colors in 2 days or people that can turn 10,000 shirts in a month. So through that business, I think we learned that we need to sort of be nimble and grow our supply chain for contract decorating.

Joe, where do you get your drive? Where does this come from?

Oh man, I have the answer to that if you want it. And it's in my blood. I'm adopted at birth. I believe because of that, I hit the lottery of life. I have the best family, the best parents. And, you know, I, I'm getting choked up thinking about it, man, but I want to be able to provide the same life for my kids that my, my parents provided to me. And, you know, that's, that's what fuels me. And that's what drives me. That's what makes me work hard. So it's, it's like, it's bred in me.

That's, that's a beautiful part of your story, man. I can easily see how that would fuel you, not only fuel you in terms of your energy and drive, but, um, deep down there's this purpose that you can sense as we're chatting.

Yeah, and you know, it's funny because I think for the longest time I wanted to meet my birth mom, and I wanted to be able to— I set a goal. I said when I was 25, I'm gonna go meet her.. And I wanted to be able to say, this is who I am. This is who you put in the world. You know, this is what I've created, or this is how I've given back. And, you know, that fueled me too for such a long time. You know, I figured, you know, there's probably this woman that, you know, has had sleepless nights wondering what the child she brought into this world is doing. And, you know, that fueled me. And then also to, you know, make my parents proud.

Yeah, that's awesome. Thanks for sharing that, man.

Thanks for asking.

Those are the best questions, by the way. Those are the best questions.

You know, it's funny you say that, and I learned— I listened to a guy speak at an event recently, and the whole talk was about asking the right questions. And he said, and I'll never forget this, he said, ask a question about the heart. And, you know, talking about American icon, I went and I had the privilege of talking to this guy that is worth millions and millions of dollars. And I was in his penthouse. I went to him to, you know, get advice. And he was, he was the big impetus, you know, in through the conversation with him, I realized, all right, I have to pull the plug and, and move on from this. But I remember, I asked him about What was the greatest lesson he learned from his father? And he started just spilling the most amazing information. You know, what really drives this guy, this guy that's worth millions and millions and millions of dollars, that's ran big companies, Fortune 100s. And once you get to the heart of someone, you know, do you really know what fuels them? I just fondly remember that conversation and, you know, leaving that room and knowing it's time to move on from American Icon and figure out how to liquidate and do right by our people, you know, through the process of shutting down. Yeah.

What part of this business do you enjoy now?

I love so much about this business. Two things that I love the most is the ability to work with anyone and everyone. I think that's The biggest thing that attracted me to this industry is, you know, there are businesses and sports teams that I'm fans of that, you know, I can go out and work with. You know, I think too, just in the last, last few months, I've started to really enjoy training and developing my team. And that's something that I'm trying to focus more and more on. But we just, we just hired two new people and I'm having a hell of a time training them and sitting with them and teaching them the industry. And I'm starting to really enjoy that part, you know, more so than, than ever before.

What are you looking forward to in the future? What's in the future for Whitestone?

Um, you know, I think a little bit of the same. And I have been distracted many times before, and I think Whitestone now is in the best place it's ever been. The people are great. The product is great, and I'm just looking forward to seeing where we can take this thing. And we're doing a lot of new, different, and exciting things that are making it fun to really come to work. And I think, I think we figured something out that's going to help us, you know, have a good ride over the next few years.

This is a bit of a self-serving question, but I like to ask it because I actually am trying to get to the heart of a different matter. How has Commenscue contributed to this growth? Has that been something that has helped on the process side where you said you, you know, you were the salesperson, but you really need this alignment with this process?

Man, Cometscue's just been everything to us in so many ways. It's so easy to use. It's so easy to present. It used to take me hours and hours and hours to just present, you know, 10 different water bottles. You know, it allows us to work fast but work smart. It's also amazing for your people. You know, your new hires, you can bring in new people to your company. Yeah. And so fast do they learn Common Skew. It's easy. Frankly, I think it has played a big role in developing our process and making things so much smoother. We used to create purchase orders with Excel spreadsheets. You know, I couldn't even imagine going back to that. You know, and I think too, I was afraid to join Common Skew in the beginning. I was afraid to join Common Skew because I thought that if I joined it, I'd be like everyone else. And it's not that. It's effortless technology that helps propel and power your business. On the first day of the Goldman Sachs 10,000 Small Business Program, I remember the instructor asked everyone, raise your hands if you have a dashboard. And I thought to myself, what the heck is a dashboard? What is he talking about? You know? And then, you know, I look at, you know, they tell you what a dashboard is, you know, a tool that helps you manage your people. Your finances and your process. And I remember the next day I called Mark Graham and I said, all right, I'm, I'm in. Let's, let's do this.

I know that folks that don't listen to the podcast regularly will, of course, you know, maybe roll their eyes a little bit at me asking it because I work for CommsCue. But what people tend to forget is I have 20-plus years experience in the business. I know how complex it is. I know how hard it is. And I've also seen firsthand what simplifying that process can do for your business. It can absolutely accelerate your growth. But I'll get off the commercial because I'm starting to sound like a commercial.

But I really do mean it.

I mean it more from the emotional side of hearing what it's done to your business. Here's one—

hearing what it's—

how it's liberated you in terms of sales and expedited this process.

Oh, absolutely. I'm the biggest advocate for it. And I tell any distributor that I talk to, that's one of the first questions I ask. I say, are you on common SKU? And if you're not— that's awesome. I love that.

A few final questions. This is one of my favorite questions to ask just because it gets us in touch with your business, the pulse of your business. What was your favorite project you worked on this year?

Probably the project that scared me the most and one that hit our desk a few months ago. We just knocked it out of the park for Corona and EDC, a music festival. We produced bikinis, bathing suits, a 26-panel festival paper umbrella. Pocket tees, reversible mesh tank tops. It was the most complex project, the most rewarding project, and the most challenging project we've ever worked on. And we only had a month to turn it. So, you know, it's actually, it's now all over our website. We've taken so many photos of it. That project was, it kept me up long hours at night, but it was the best project we've worked on this year.

It's usually those tough ones that are the ones that are the most memorable, and you learn the most through the process. Well, based on what you've learned building your business, what would you tell a younger Joe Sommer?

A couple things, probably, you know, as it relates to the business. I wish I positioned the business differently when I first started. You know, I didn't have a direction. I was kind of flying by the seat of my pants, and I'm naturally a risk taker. So I wish I would have taken more risk on the branding and the positioning of our business and not be so conservative with my brand. And probably also to go out more, have a work-life balance. You know, I think anyone can relate to that one. But yeah, I spent the first 2 years just locked in my apartment and I probably would tell the younger Joe to go out more. And, you know, that presentation can wait until you get back.

Yeah, you know, some of the most successful entrepreneurs in this business have that. They've, they've arrived at some sort of some symmetry that they have in their life. And it's such great advice to younger Joe Sommer. Well, Joe, it's been a real privilege talking to you. I appreciate your enthusiasm, your energy, your honesty about the business and the lessons that you've learned that mean so much to not just me, but the whole Common Skew team that values that so much because we know that's going to help other entrepreneurs and that's what we're all about. And I can't tell you how much I appreciate being on the podcast.

Well, Bobby, thank you so much for your time and inviting me on. It means a lot.

Thank you.

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

Mm-hmm.