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Guest Author: Intro
In 2010, they invested $200 to buy 400 bracelets.
In 2019, they sold the company for $130M.
Today, the company does $100M+ in ARR.
Here’s the story of Pura Vida: Paul and Griffin started Pura Vida as a way to support artisans all over the world.
Since then:
- $100M+ revenue/year
- 30,000,000+ products sold
- Products in 5000+ retail stores
- 600+ artisans supported throughout the world
One BIG KEY to Pura Vida’s success? They focused on being profitable from the start, kept the business super simple, and used the back-of-the-napkin math instead of complex spreadsheets.
Paul and Griffin understood all the numbers PRIOR to scaling:
- What it costs to buy, ship, and market a product
- What to sell the product for
- Overhead costs
- Profit per unit
- Overall economics Going to THAT LEVEL of depth in unit economics allowed them to price the products correctly as they came out with new styles and collections.
This simple napkin-math mindset helped them bootstrap to a $130M valuation and exit …
But how did it all begin?
Here’s the full story from Paul’s POV:
In 2010, we two planned to go to Thailand for our college graduation trip.
3 weeks before the flight, civil unrest broke out. Our parents said we had to change destinations, so we switched to Costa Rica because we had never been to this beautiful country. While walking on a beach, we met two local artisans – Jorge and Joaquin.
They were selling handmade bracelets on a dusty table to tourists as they walked by. We spent our last $200 to buy 400 of their bracelets. We set up their emails & PayPal, as we had a gut feeling we’d need them.
In 2 weeks, we sold out of the 400 bracelets from Griffin’s bedroom. People loved the colorful bracelets, and we made a little bit of money.
We decided to chase this idea even more.
What did two recent graduates have to lose? We contacted the artisans back in Costa Rica and asked if they could send 1000 more bracelets.
They didn’t reply for 10 days, and we thought our business was over before it started. But they eventually replied, and it was on.
We chose Pura Vida bracelets because Pura Vida is used as a slogan in Costa Rica. It means “Pure Life.” Costa Ricans say it as a hello, goodbye, or a greeting. It is like “Aloha” in Hawaii.
The beginning years of Pura Vida were incredibly fun but equally hard. I had my job as a valet at night, to make money to pay the rent, while we worked all day on PV.
There was just so much to do in the business. We took NO salary for two years and put everything back in. We didn’t run paid ads in the beginning because they didn’t even exist.
FB hadn’t released its advertising platform yet. So the way to market the brand was through our FB fan page, word of mouth, and physically telling people about the brand. Every Monday we would walk around college campuses and walk in the library.
We would tap girls on the shoulder and ask if they wanted a free bracelet. The girls would stare at us like we were crazy, pissed we were interrupting their study time. But once we told them about the bracelets and artisans they were supporting, they’d get excited to hear more.
The only catch was, in order to get a free bracelet, they’d need to suggest our FB fan page to their friends. This was before any other social media really existed.
People joining our fan page through mutual friends was a huge way to spread our brand name and have people join our movement. We also went to street fairs and set up booths. Every time we would do this, we would wake up the next day with 3-5k more fans on our Facebook page. We also put the bracelets in a small bowl in a boutique in Malibu called Planet Blue where Griffin’s mom worked.
We put a sign saying “Pura Vida” bracelets for $5. We chose $5 because the $5 footlong at Subway was really popular back then. (revolutionary pricing model) Then we were in a tradeshow called Project in Las Vegas, and one of the nights, we were out at a club with the team.
While we were at the club, I met this girl and told her about Pura Vida and the story behind it. Her response was “Oh, I can help make you guys make $$$$$” Intrigued, I asked her to tell me more. She said she worked for a PR firm that represented @LaurenConrad who was a reality TV star. We ended up paying her $7,500 for a blog post, tweet, and FB post to tell her fans all about Pura Vida. The day she put her posts up, we did $30K in sales.
An ROI of 4X was unheard of back then. And this was before social media “influencers” were a thing. Once we saw how well this worked, we doubled down on it and signed a year-long deal with Lauren Conrad for $100K.
It was our biggest ever marketing expense, and we were off to the races with the “influencer model” Then the goal was to find more people who fit the vibe of the Pura Vida brand and have them share the mission and the story.
This happened through our “Campus Rep” program, which was basically students replicating what we were doing on college campuses. College students would fill out a form on our site to join the program. Once we accepted a rep, we’d give them 25 free bracelets, 25 stickers, and a 20% discount code. We’d help them give out the 25 free bracelets and have people spread the word about Pura Vida.
The “campus rep” would get a 10% commission every time their code was used. This program was like pouring gas on the fire. We were then getting orders from all over the country and eventually scaled this program to 100K Pura Vida Campus Reps. We also hired my sister and our best friend to manage our wholesale program.
We felt it was necessary to start selling to retail stores from the beginning because it was a way for us to get our products to more people. This is our first retail showroom in our office in 2013 The campus rep program, the influencer program, and the wholesale program created substantial buzz about the brand. I was on a trip to Rome in 2014 when I met a whole family wearing Pura Vida bracelets. 4 years into it, our brand was world-famous!
Also back in 2012, we built out our “Charity Collection” to serve 120 different charities after customers requested a way to buy bracelets to support different causes.
We’d donate a percentage of the earnings back to that respective charity with every sale. This was a win/win. We were raising awareness and money for different causes, getting customers excited to buy a product that supported a cause dear to their heart, and furthered the mission of the brand. This was super influential in the growth of Pura Vida. Then we started spotting celebrities wearing our product.
Every time we had a celeb sighting, we would make sure to get the photo and post it across all of our social media. This built social proof and helped drive traffic to our website. Because of all of this, our sales were doubling every year. It was so hard to keep up. But the key to figuring out everything was to outsource the tasks that we were not experts in.
Without outsourcing, I don’t think we would have been able to scale the business like we did. We were good at branding, marketing, creative ideas, new products, and growing our social channels. We had never built out a warehouse to ship products or a customer service department.
So we decided to outsource our customer service to a professional customer service company based in the Philippines. They were EXPERTS in Customer Service and worked with a bunch of other DTC companies. Our customer service ratings went through the roof when we did this.
We also outsourced our shipping and fulfillment to a professional 3PL (Pick, Pack, Ship) which enabled us to have every order shipped on the same day it was placed. We outsourced our bookkeeping, cash flow forecast, and P+L to an outsourced accounting firm.
All of this allowed Griff and I to focus on what we were good at and streamline the business. Of course, this wasn’t an overnight thing and took us years to figure out, but it enabled us to scale the business quickly. We added on the paid ads in 2014 when FB came out with the ad platform. This was like crack for the business because it allowed us to reach so many more people at a time.
There was also very little competition on FB ads because it was such a new ad platform. This allowed us to achieve a 5-7-5x ROAS in the early days. If you invested $100, you would get $700 in sales. With our product margin being 80%, this was like printing money.
The goal then became how we could spend as much per day as possible. To do this, we needed to find an agency and empower the EXPERTS in digital media buying to help take Pura Vida to the next level. We ran through multiple agencies, all the fancy pitches and fancy offices. But the one that worked best was a small agency in SF with 3 people.
They were paid media gurus that lived and breathed FB ads. When we finally found them, they were able to scale us up. At the time we exited the business, this agency had us all the way up to spending $30M+ / year on paid advertising. All while being profitable…
In 2016, we ventured into a new vertical – jewelry. We launched Wave Rings as an extension to the bracelets because customers kept asking us for metal jewelry.
IN 2017, the “WAVE RINGS” ad went viral and became one of the most viral products we had ever seen. We quickly went from selling 300/month to 30k/month in less than a year. The supply chain challenges around scaling production were a massive headache, but it was a super fun and a challenging problem to solve. This also helped us to expand our production to India.
In 2019, we sold 75% of the company at a $130M valuation to Vera Bradley and there was a round of media coverage that helped us grow even further. Vera Bradley helped us open 4 retail stores to continue to grow the brand.
In 2023, we sold our remaining shares to Vera Bradley and fully exited the business. It was a fun ride building Pura Vida.
Over the years we’ve ended up supporting 600+ artists while also creating a great business out of it. I’m super proud of what we did together!
Key takeaways:
1) Profitability is the NUMBER ONE metric for bootstrapped business survival.
2) Finding arbitrage between COGS and sale price should be the main focus for DTC brands- i.e. have large margins and profit.
3) A good reality check for healthy profit margins: If your expenses go up 30% overnight and stay there, will you stay in business or die? Maintaining that margin is important if you don’t want to raise funds or take huge loans to survive.
4) Outsource expert tasks by default.
– “One” is the most dangerous number in business. Diversify your channels and production. – If you’re mission critical to the business operating … you’re a liability. Buyers want to know the business will keep humming along without you.
5) Keep your mission at the center of everything you do. It’s a great motivator to know what impact you are having in the world with your daily effort.
Both your team and customers want to associate with your brand when you keep the mission at the forefront.
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