SECRETS OF SUCCESS
ENTREPRENEURS SHARE WHAT THEY’VE LEARNED
INSPIRING PERSPECTIVES
Each Sunday, the AJC brings you insights from metro Atlanta’s leaders and entrepreneurs. Matt Kempner’s “Secrets of Success” shares the vision and realities of entrepreneurs who started their dreams from scratch. The column alternates with Henry Unger’s “5 Questions for the Boss,” which reveals the lessons learned by CEOs of the area’s major companies and organizations.
Find previous columns from Unger and Kempner on our premium website for subscribers at www.myajc.com/business.
Filkins’ tips:
— Don’t overextend yourself. Focus on one thing. Do it better than anyone else.
— Hire the right people and save yourself headaches down the road.
— Build local relationships, such as with a locally-based bank. Find a way to meet with the bank president.
Element Climbing and Climbing Wall Supply Company
Based in Jasper, Ga., 60 highway miles north of downtown Atlanta
Launched in 2008.
David Filkins, 37-year-old founder and president.
Annual revenue: About $500,000 and expecting $1 million this year, based largely on increased contract work for other hold companies.
Profit margin: Operates at a profit, but all gains are rolled back into the company.
Business: Element Climbing makes the plastic holds that climbers use on rock climbing walls. Customers include both climbing gyms and individuals with home walls. The company makes its own brand of holds and does contract work for other hold companies. In 2013 it produced about 85,000 holds. This year, Filkins predicts it will make 200,000. At retail, the average mid-sized hold sells for about $10 apiece. Holds are bolted into walls. Filkins and his wife also own Climbing Wall Supply Company, which centers around an online retail site called CheapHolds.com.
Staff: Eight full time workers including Filkins’ wife, Lisa, who is director of operations, and three part-timers, including David Filkins.
Ownership: Filkins and his wife own the companies.
Filkins’ salary from the business: Zero.
Filkins hours: 20 hours a week for his own businesses in Jasper. Another 40 hours a week working for another company as a software engineering manager in Alpharetta.
“If you can find something you are truly passionate about, you can become an expert. It is just a matter of time.”
“He said, “Why should I buy them from you?” I didn’t know how to answer his question.”
“I want to be able to do this full time and not have to work in corporate America.”
David Filkins isn’t passionate about his corporate day job. But give him an indoor rock climbing wall and he’ll dream endlessly of new handholds to make for climbers.
Now, the hobby he began in the basement of his Jasper home in north Georgia has become a real business.
Element Climbing and Climbing Wall Supply Company have eight full-time employees and expect sales to double this year to $1 million. Filkins, who puts in 20 hours a week to lead the business, hopes to eventually ditch his other job as a software engineering manager. He wants to join his wife in running their businesses full time.
(After high school) I worked third shift at a factory for awhile bending sheet metal. I couldn’t stand it. It was so dangerous and loud. I sold frozen meat door to door. I never felt like I was a natural sales person. I always felt I was more of an introverted person. But I discovered for whatever reason people would trust me and they would talk to me, let me into their home and buy frozen meat from me.
But how passionate can you get about frozen meat?
He eventually branched into technology and ended up working for a payments processor.
Working for a big corporation was very safe, very secure. (But) to me, it is not fulfilling. Especially not the same way as when you can take a product that you know, you designed, you can see it, touch it and feel it.
A buddy of mine got me into climbing (at a local gym). I fell in love with it right away. My wife and I had just finished construction on our house around this time. I found out you can build your own climbing wall. I had some space: The basement was totally unfinished. I bought a few holds from the local REI and bolted them up. I realized these chunks of plastic are not cheap. I did some research on the web.
I started messing around with making climbing holds just as a hobby. Some of my original shapes were awful.
You don’t have to be an expert. If you can find something you are truly passionate about, you can become an expert. It is just a matter of time. My father was a carpenter by trade. I learned a lesson from my father: obsessive attention to detail.
I tried different types of silicone, different types of foam, different types of polyurethane, pigment.
Me and my friends and my wife would go to local climbing gyms. I would takes the shapes with me and got feedback from the people. They (gym owners) asked if they could have some and, ultimately, if they could buy some. That’s when it clicked.
STARTING OUT
It was a gut move: “I know I can make a product that is better than what almost everybody else in the market is making right now. And eventually people are going to know who we are and do business with us.”
We probably started it for a few thousand dollars. We took it from our personal savings. It was basically R&D, buying materials and trying new things.
Our climbing holds are made from a polyurethane resin. The original shapes are created out of a high density foam. We cast a silicone mold on top of that, and we will create the actual climbing hold from the mold.
When we started I was doing everything in the basement. There was green foam dust all over. I commandeered an old ping pong table. I was using that to do all my pouring on. I had drill presses set up. I had a little sander set up. One of the things I discovered was that warming the molds beforehand seemed to have an effect on the finished product if you are doing your first cast and the molds are cold. So I started taking them upstairs and would warm them in the oven. The smells were unpleasant.
We found out (my wife) was pregnant. She said, time to move out of the house and get a warehouse. We were probably doing $4,000 or $5,000 a month in revenue. The thought of moving into a warehouse was overwhelming.
I did a lot of cold calling to climbing gyms. I’d explain to them what we were doing and offer them samples. Any time I was in a new city I would bring holds with me, find the local gyms, talk to the owner or the manager or the head route setter.
Early on, he visited a gym owner in Charlotte.
He said, “Why should I buy them from you?” I didn’t know how to answer his question.
Since then we have a much clearer vision. Or we actually have a vision.
We learned a lot along the way. We were fortunate in that we grew slowly. My wife (Lisa) was working a corporate job (at first). It would have been a completely different if she and I had quit our corporate jobs and had to quickly grow this business to replace that income. That would have been a disaster.
I want to be able to do this full time and not have to work in corporate America. I’m not passionate about what enables someone to enter a deduction code in their payroll processing form. I can do it, but I don’t enjoy it.
I’m usually working in the evenings (on the climbing business), working from home. It’s very challenging. I don’t like taking the time away from my family. Lisa runs the day to day (at the business).
Everything we’ve made profit on, we put back into the company. I don’t like the fact that I don’t pay myself (for the climbing business work). I think I’ll pay myself soon. But first we’ll pay my wife more.
The industry is so young. It’s like the Wild West. There’s all kinds of crazy stuff. A lot of companies will copy each other’s ideas, copy each other’s shapes. There is a lot of inside buddy system that are borderline anti-trust.
CHALLENGES
His first big order was with Stone Summit, a large indoor climbing gym near Spaghetti Junction.
It was probably $5,000 worth of climbing holds. We poured the whole order, we drove it down to hand deliver it. The guy started grabbing them out of the boxes. None of the bolts would fit.
A new wall in the facility took bolts with only metric dimensions.
We had to take all those holds back and make new ones. The ones we use now are universal.
The biggest mistake I’ve ever made in this business is hiring the wrong person. Instead of waiting for the right person, we settled. If you have the wrong person, you spend so much of your energy trying to fix the things they do wrong or micromanaging them. You lose so much of your own productivity.
He spent $5,500 to buy a portable climbing wall, hoping it would be the first of a fleet of walls he would rent out for events and sites in Atlanta. Less than a year later he sold the wall after barely using it.
I thought we’ll diversify. If you have your eggs in more than one basket it is a good thing. Now, I think we really want to focus on just making climbing holds and making them better than anybody else.
