Bootstrapping to $23 Million: Michael Nemeroff, CEO of RushOrderTees (Part 4)

Sramana Mitra: In terms of strategic moves, what were some of your moves that were driving this growth?

Michael Nemeroff: We invested in people, getting the right people in place, and learning about management, which wasn’t easy for us. We don’t have any formal education on management. We don’t have any background on that. I don’t know if I told you. Customers just keep coming back, which was a big thing. We realized that customer experience is huge.

Technology came in around 2007 to 2008 where we invested in technology where customers can self-service. You can go online, design online, and checkout online. We invested on that but it didn’t really take off until we started putting marketing dollars behind it. We hired someone to handle the marketing and focus on e-commerce conversion. We had two to three years where the e-commerce side didn’t do anything for us. Now it does a lot of sales for us. It was just about shifting the focus, investing into the technology we’d already created, and marketing that.

Sramana Mitra: As you were putting all these things in place, the Internet was also changing through the years. There’s been a lot of change in the Internet. Social media has become big. Accessing customers has become somewhat easier and in some cases, more expensive because Google keywords have become more expensive. Talk a little bit about how your customer acquisition strategy evolved through this period.

Michael Nemeroff: In 2010, we invested in Google to focus more on an SEO strategy. You’ll invest months and maybe years in SEO and see zero results. We started investing in SEO and that started picking up to where a lot of our money was coming from Google just for free. We strengthened our marketing strategy with SEM and started understanding how powerful this could be. We focused on SEO referral business and reorder business.

Sramana Mitra: Your customer acquisition was mainly SEO and SEM – SEO first and then SEM later.

Michael Nemeroff: Yes, but 30% to 40% of our business today is attributed to reorder customers or referrals from those customers.

Sramana Mitra: What percentage of the business is B2B versus B2C?

Michael Nemeroff: B2B is about 60% to 70%. The personal stuff makes up the rest.

Sramana Mitra: In the course of building this to about $20 plus million, have you ever availed of any kind of financing?

Michael Nemeroff: No, we’re completely self-funded. We don’t keep inventory levels high. We don’t keep accounts receivables high. We learned how to manage cash a long time ago and take that risk out of the business.

Sramana Mitra: Any other particular strategies or tactics that you used to make your business successful that is worth discussing in this story?

Michael Nemeroff: We’re more of a technology company today than just a t-shirt company. Without tech, we couldn’t do what we do today. All of our software is 100% custom-made. We have a big software team. We have 10 people on our software team. Internally, our ERP system is custom-built from the ground up and is extremely efficient. People aren’t running papers around. It’s all done through the system. Other than that, it’s retaining and recruiting people. We’re doing that with better benefits as the year goes on and by just making it fun as well for the team. That helps us grow the business.

Sramana Mitra: Thanks a lot.

This segment is part 4 in the series : Bootstrapping to $23 Million: Michael Nemeroff, CEO of RushOrderTees
1 2 3 4