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Professional Mountain Biking, EPIC Growth And Shady Characters? with Jeff Cayley

We are talking with the Founder and CEO of Worldwide Cyclery. That is Jeff Cayley, a young buck that has been on some epic growth. He has also topped the Inc. 500 list, two times he's been a part of that and the Entrepreneur 360 list generating millions of dollars in revenue in the eComm specifically selling high-end bikes and accessories. He also was a former professional mountain biker.

In this show, we talk about the mountain biking industry. We talk a little eCommerce. We talk about the journey of building it and how do you build something to grow quickly. We talk about building a good team and forming great culture. If this is something on your mind, it's very interesting some of the things that he is doing. I don't want to spill the beans.

Dustin
Jeff, you're eleven years old and you’re in middle school. You're tinkering, selling things around the house on eBay. You get that break that comes from your friend that introduces you to his dad that gets you an account as a retailer. You've got direct inventory coming in from a big home goods liquidation company. Over that summer, you sell $250,000 in faucets and shower heads. Life is good. You're young. You're selling a bunch of stuff on eBay. Fate has it. You get a phone call, it's from the owner of the company. He's got some news for you that's going to change everything. Jeff, will you take us back to that moment in your life and tell us what was going on and what happened?
Jeff
Selling on eBay has been a wild ride. I've been selling on eBay since I was probably ten or eleven years old. You had that part. I didn't get into this whole faucet shenanigan until I was nineteen. It was when all of that happened. I got that account at a home goods store. A buddy of mine's dad worked there as a sales rep. The biggest thing was the life lesson of learning about people who end up being shady but don't seem like it at first. That was the biggest lesson there. It was wild. I was good at selling things on eBay. I'd sharpen my teeth over the years, being a kid selling bike parts mostly. I found my way into this faucet business and sold a whole bunch of those. It turns out that they were all being shuffled around in a computer system and not being paid for correctly.
Luckily, I didn't get in any legal hot water there. The owner of that business was super empathetic and a cool guy. When all this came down, I was like, "What is going on?" I got all my records together. I got down there immediately and poured my heart out as honestly as I could because I knew that was the right thing to do. Because of doing that, those guys understood. They were pretty far along the road of being mature businessmen. I'm sure they'd seen a thing or two like that before in their past. They understood what happened. I got off scot-free. My buddy's dad who did the whole shenanigans, he got fired. He was worth no money anyway, so they didn't even bother suing them. They wrote it off as a loss and went on with their lives. They told me as long as I get a proper employer identification number, I can keep my account there and keep selling stuff, which I tried for a little bit. It was a lot harder to move the product at the same speed when it was priced legally and not stolen.
Dustin
Did you still remain friends with the friend or was it weird at that point?
Jeff
I did. That's like a whole weird long story. It's two of my best friends that it was their dad. It wasn't they were responsible for that. It was something I'd cut on the side. At one point, both of them said, "My dad has done some stuff in the past that I think he owes some people money. A quick little warning." They didn't know the extent of it. They didn't expect their dad to do something like that. They probably didn't doubt that their dad would do something like that. They took the approach of it's not their business, which wasn't their business. It was something I'd ended up doing with him and learned my own lesson there.
All of us were young. They didn't know the extent of what their dad had done or was capable of doing or whatever. They knew their dad was maybe a little bit of a shifty business dealing guy here and there, but maybe not to that extent. I don't blame them in any way, shape, or form for not seeing that coming. We were all young so they went with it and knew that it was a business dealing I had with them. They were in the dark most of the time anyway. They weren't exactly sure what was going on.
Dustin
Did you have any inkling like, “This is too good to be true?” or you didn't understand business or it was, “Don't ask, don't tell?” What was going through your thought process back then?
Jeff
Definitely part of it was I was young. One, I didn't know anything about that industry. I understood and knew the bike industry because I'd work at a local shop for a long time as a kid. Even the music industry, I’ve been in the guitar industry for a bit playing guitar growing up and selling stuff here and there. I understood that, but I didn't know anything about the home goods industry, nor did I know about the liquidation part of it. That's what the company did. They basically dealt with these huge buybacks from companies like Ashley Furniture, Home Depot, Lowe's. When those big, huge mass retailers would get stuck with all of this old inventory, these guys would swoop in, buy for pennies on the dollar. They would find a way to turn it over to their network, which was mostly a pretty big network of different contractors and who knows what else. I didn't understand that industry that well. I didn't understand the profit margins. I was in the dark coming into the thing. Again, I was very much lied to. When we cut the deal, he was like, "We have faucets that sold well. I'll see if I can get you some and you can do a small test and see if they work." I said like, "How much do these cost?"
At first, it was $35 per faucet. I was like, "Okay." I tried to make that work. I couldn't get much traction. I would sell them a little bit. It was nothing spectacular. I'd told them about that. He was like, "Let me see if I can get the price down?" The next thing you know, he was like, "They're $9." It was a pretty huge difference. I had dealt between $9 and $35. It’s pretty huge. I just went with it. I was nineteen years old. I was like, "That sounds good, $9 it is. I'll adjust the pricing accordingly to make sure we're still making a decent margin here, given eBay fees." That's when they started to fly. I thought, "Can we get more?" It was like, "We got more." The price was always $9. It was a little harder to get them sometimes. It was like, "You can drive to the external warehouse over here." I remember going into this one warehouse, which was owned by this company. I walked in. There were three guys in there. They were the only guys there. All of them looked shocked when I opened the door. One of them yelled the F-word, runs in the back and I was like, "What's going on?" I remember him saying like, "It wasn't him,” or something like that.
They thought I was somebody else and whoever else this other person was they thought was opening the door, they were prepared to fight. That was a little weird. I was like, "This is getting weird." There were pallets and pallets of different stuff in this warehouse that. It's so much inventory that you could easily slide off a few hundred thousand dollars' worth of one of those things. Probably nobody would notice at least for a long time. That experience was like, "This is definitely getting shadier by the minute." It was a fun experience for me as a kid. Not only learn about high-velocity eCommerce and the opportunities and how quickly you could scale something like that up but learn about business in general and learn about ethics and human ethics. How some people are shady business people and other people are. It's sometimes not easy. I always thought it was easy to read. I was a naive kid. I thought, "If this person seems and feels trustworthy, they're kind and get back to phone calls and emails, they're probably a good person." It's not always true. Sometimes they can seem the greatest person ever and totally be pulling something shady behind the scene. It was a good lesson in judging people and learning business ethics in a very hardcore, abrupt way at a young age. It was funny.
Dustin
Thanks for sharing that. I want to spend some time here on what you do now because you've been in business quite some time. I want to definitely talk about Worldwide Cyclery. First, because you had this lesson at such a young age, I'm sure this has come up before again and again. Sometimes, folks that you come into contact with, they're downright shady like this particular individual or they have good intentions. They're trying to fake it until they make it and they sell you because that's what they're told. "I can do these Facebook ads for you," or whatever it is. The plight of so many entrepreneurs as we come into contact with folks that I like to think mean well but I know they are shady figures out there. Jeff, what do you do to vet whether it's a new partnership, a vendor, a joint venture deal? What do you do to read or vet a new person in your life to protect your interest, your team and your company?
Jeff
It is challenging because when you own a business you're inundated with advertisements. "We can do your Facebook ads. We can do this advertising. We can do this. We can do that. We can help you grow revenue here." It never ends. Having to find a way to sift through all of that and figure out who's legitimate and who's not is a challenging thing. It's a never-ending thing that you deal with as a business owner. What do I do now? I've still made mistakes, especially in the early days, the first few years of our business. Our business grew pretty organically with a strategy and technology advantage. We didn't do much formal marketing until probably two and a half, three years into it. When we got into that, that's where all of them live. Many people own marketing firms that their whole MO is smoke and mirrors. Sometimes I think they're doing it intentionally. Other times, I don't even know if they know. They don't understand. Marketing is very hard. Especially eComm businesses, you're talking attribution. It's not always cut and dry.
If you're looking at, “Let's try and calculate the ROI here,” you look at all these different attribution models. It's not a yes or no. “The person clicked and they bought.” They might've clicked. They didn't buy. They saw it. They then came through a different ad three weeks later. They bought something, but it wasn't related to the product of the first ad. Who got the attribution? It's not easy. You can argue that. It's an art rather than a science to some extent when you're looking at attribution models. It is challenging. We are so much more educated on the topic. That's how you're going to win. If you're as wise as they are when it comes to what they're selling you, that's the thing. Coming in prepared means coming in with a lot of knowledge of the topic because if you don't know anything about attribution models and marketing, the technicalities behind all of it, you go walk over to a firm, any smoke and mirrors firm is going to be able to sell you and show you how your revenue grows and avoid the topic of the fact that there is negative ROI.
If you come in there and you know your thing, they're going to treat you differently and you're going to be able to vet them better because you're going to be able to look at the numbers and understand if these people are performing. Being educated is a huge key there because a lot of the way you get caught off guard is when you come into those things and you're not the most educated. You get taken advantage of. Sometimes you think, "I'm too smart or too good at this to be taken advantage of." That's probably not always true. I definitely came into it with probably a little too much confidence here and there. As we've learned more and more stuff over the years have realized this is not what we anticipated it would be. This person is not as good as they said they were. They don't understand what is going on here either. That's how you can catch people off guard and be careful with it. It is hard. As a business owner, it's you're always doing that. You're always vetting different firms that you're paying money to see are they worth it? Does it make sense?
Dustin
Jeff, I’m 100% with you. Education, that's why we're here at Get WealthFit show is to give people education so they can avoid mistakes like that. It's going to happen in life. Thank you for reaffirming that. I want to take a little step back to your professional mountain biking days. What is it like to be in the world of professional mountain biking? Are you getting on private jets? Do you have a Lamborghini when you win? Describe a little bit of what this world looks like.
Jeff
It's not glamorous by any means. It's an extreme sport. It's not like a mass media sports. There's not that much money in it especially at like the smaller scale that I was on, the national level, even a global scale, the World Cup guys. A lot of those extreme sports as you'd imagine it's like skateboarding or surfing or motor cross. Most of the money in that industry go to your top five guys. You talk about a wealth gap. The top five guys are probably making 90% of the money in terms of sponsorship contracts and winnings and all of that stuff. Everyone else is scraping by trying to get there. There's a massive drop off there. That's how it is in a lot of extreme sports. Mountain biking is no exception there too.
The top five guys are doing well and everyone else is not doing so well. Mountain biking, especially as a career, is not about money by any means. It's about passion. You're a mountain bike racer if you genuinely passionately love racing mountain bikes in that industry, in that scene, and that's where you fit in and where you feel good. If you can find a way to make a mediocre career doing it, a lot of people cling onto that as long as they can because it's fun. You're in it for the lifestyle, the passion, the fun, and the adrenaline rush of it. You're not in it by any means for making money. It's not that sport. I wish I could tell you it was something like golf or baseball, but no way, not in any way, shape, or form.
Dustin
Jeff, the pinnacle of mountain biking, is it Olympics because it's an Olympic sport, yes?
Jeff
Yeah, it is, depending on the discipline. Cross Country Mountain bike racing is an Olympic sport. Downhill Mountain biking and Enduro Mountain bike racing, those are not Olympic sports and that was what I was doing. I was doing Enduro and Downhill racing. Those ones aren't Olympic sports. A lot of sports like that especially cycling, in general, is a lot bigger in Europe than it is in North America. Once you get on the world scale, there's a UCI which is the big international cycling body that puts on large races. Those are all broadcasted on nowadays like Red Bull TV, broadcast all of the Cross Country, Downhill and the Enduro Mountain bike racing and all that stuff. A lot of it's on mainstream TV in Europe. It's not as much in North America. The pinnacle is the world stage there, which would be that stuff. There’s more publicity for it in Europe than there is in North America.
Dustin
Jeff, I can tell the passion and the knowledge oozes out of you. You're racing. You're doing your thing. When do you get this idea to start Worldwide Cycler?
Jeff
Growing up I worked in local bike shops. That was fun. That taught me a lot about the industry. That was key. You have such an advantage if you start a business in an industry you truly intrinsically understand. What I mean by that is who is the consumer, what is the product, who are the distributors, how is the flow of money going around, what's the little mini-economy of that industry and how it all works. That was the stuff I learned as a kid working in shops but also learn being a racer, being a participant in the sport, and a consumer of those products. I spent a lot of years doing that growing up as a teenager. After all of the selling, all of those faucets, mind you, stolen product, I learned a lot about eCommerce and how I can scale quickly.
That experience was eye-opening to me. I was like, "You can sell stuff online and it can grow fast if you have the right price and you figure a couple things out." That's what sparked this idea. I could see this being a sizable business. I don't want to sell faucets because I don't care about home goods. I have no passion or care whatsoever for that stuff. I want to do with bike stuff. At that time, I was living in Pennsylvania, racing out there. I had moved back home to California. I worked at a shop, the same shop, I normally worked at as a kid for a year. I spent a year planning and thinking and also testing the waters. The guy who owned that shop was a cool, awesome, nice guy. He would allow me to basically buy stuff at wholesale cost on my own credit card. My side hustle at home, I would go home at night and I would post this stuff on eBay and on forums, figure out how to sell it, who was buying it, where they were and all that stuff.
I spent a year thinking, planning, and testing the waters. It was like very calculated in that sense and pretty cautious. I definitely didn't jump into it. I knew the industry. I spent a whole year planning and testing the waters. I found the opportunity there. I realized by doing this testing like, "This is plausible. I could make something out of this." I was young. I ended up starting the shop when I was 21. I didn't have any grand vision other than I want to do this because it seems fun and I think I could make a living out of it. That was the extent of it. It's evolved a ton since then. That's where I got the idea and thought about it. Knowing and understanding the industry was key to seeing the opportunity and then being able to seize it successfully.
Dustin
Jeff, I want to get inside your head a little bit because I for sure think of you as a genius for what you've been able to do. You keep talking about the opportunity. There are tons of bike shops around. I'm sure people were selling stuff even at the time that you decided. What exactly was the opportunity you saw? You had all this market research. You understood the customer, but what was the opportunity you saw at the time to make you pull that trigger?
Jeff
It was a few things. We didn't invent anything new. We didn't come up with some crazy technology or intellectual property. There's maybe sometimes a misconception that you need to do that in order to start a business, which you don't. Most businesses don't do that. They go and compete with other people. That's what we still do now. Now that we're a lot more evolved, we're desperately trying to find ways to not have competition. We want to build something unique, build this umbrella strategy, and build something that's hard to replicate for different reasons. In the early days, it was straight up like, "I could compete here." That was the opportunity.
The opportunity was the industry had your local bike shops. That's what service to the market. Most people bought stuff locally. There were a few online players, but they were very unsophisticated. I was able to see that from what I'd learned and understood about eCommerce, I saw the holes that these guys had. They were selling a lot of products online. eCommerce has been growing like crazy for a long time now. That's a rising tide that lifts all boats. If you started an eCommerce business in 2011, eCommerce, in general, the percentage of people that buy things on the internet has grown a ton. That was a big opportunity there that I saw. I saw that people that were selling this stuff online, they didn't have good customer experience. They had a lot of bad ratings and reviews from that.
Their sites were very dated. Their marketing materials were very amateur. It was almost like me looking at the landscape of the bicycle industry and the players in it in terms of eCommerce. Looking at those guys and saying, "These guys are competing on a very unsophisticated amateur level. I can come in and kick their ass in terms of customer acquisition, the efficiency of the business model, and unique logistics infrastructure." I saw all of those different things and realize that "We can step onto the field here and compete day one and do well purely because of what they were doing and their lack of sophistication." I knew I was going to be able to compete well and succeed.
Dustin
Jeff, I read somewhere that you're on a mission to redefine what a bike shop can be, a two-part mission, to build the best bike shop on the planet. In that head of yours, in that brain of yours, what does the best bike shop on the planet look like?
Jeff
That is something that we’re ambitious to do as a team. One, it's got to be a customer-centric business. At the end of the day, it's retail. What does any good retailer need to accomplish these days? It's not an easy thing to accomplish what standard now, especially with Amazon, but it depends on the industry. For us, bicycles are a very technical product, especially once you get into the high-end segment. Most of what we sell are $5,000 to $12,000 bikes, all the accessories, apparel, components and all that stuff that goes with it. There's a lot of complicated stuff in terms of fitment, in terms of product testing, or wanting to demo different bikes and experience them before you spend all this money on it.
There are a lot of different facets to how retail works in that industry. It's got to be very multichannel. It needs to be a white glove. It needs to have absolutely incredible customer support. It needs to have super fast shipping. You need to be totally multichannel. You need to have stores where people can come in, touch, feel and test the product. You need to have a huge presence online because that's probably going to be the majority of it as things evolve and it is for us. We're mostly online as opposed to. We do have two retail stores, but the online component is much bigger and much more important to us. For us, it's a customer-centric business that has a ton of product knowledge because it is a technical product. Giving customers the ability to shop online, shop in store, buy online, pick up in store.
It’s becoming a lot more commonplace, the whole click and collect and that customer experience and good, beautiful eCommerce design where retailers provide a lot of value with the customers in a number of different ways. One of those as being product education, good content and videos and all of that stuff. That's how we see it. We continue to execute on all of those things to make sure when we say redefine what a bike shop can be, a lot of that does boil down to redefining the experience you get as a mountain biker, as a cyclist when you shop for things. How does it work when you shop at your local store versus one of our local stores or when you shop online at one of our competitors versus us when you research your product? What information do you find out there? Do we pop up and do we provide value in terms of that stuff? It's all focusing on the customer experience.
Dustin
I'm interested to know as much as you can share in terms of the retail setting, what would be an example of doing something contrarian or different than a traditional bike shop would do? Do you serve beers? Is it one of those types of things that you're thinking about? When they walk into the store, how can I make this a Disney-like experience?
Jeff
For us, it's less about the little perks like that. That is pretty common. There are a lot of cool bike shops these days that are mixed in with coffee shops or mixed in with little breweries and sell beer and coffee and stuff. For us, it was a little bit more of the way we structure our business model. Most bike shops, which probably everyone reading, including yourself, has been into a number of traditional bike shops over their life. Most bike shops are often big, sometimes small depending on where. They serve such a large market.
Cycling as a whole has changed a lot in the last twenty years. There's been a lot of things that are niched down. You have the high-end road bike segment and the high-end mountain bike segment. You have beach cruisers. You have kids' bikes. You have BMX bikes. There are a lot of different segments of bicycles these days. Traditional bike shops have always tried to service all of them. The issue with doing that, as you can imagine, is if you try and service all of these different segments and all these different customer types, you ended up sucking at serving all of them.
The biggest thing for us when we built out our presence in the online store and our retail stores were picking a customer. It's the high-end mountain biker and that's what we're sticking with. They're going to love us because that's all we do. If you walk into our store, all you see is super high-end mountain bikes and a bunch of parts and accessories that are related to that. Every person in the store is educated on that, rides bikes, and knows all about that stuff. Imagine if you're a guy who is very specific about a certain type of Ferrari and racing cars. You don't want to go to a Ford dealership. That's not the experience you're looking for. You're looking for a white glove experience where you can walk in and all the other Ferraris are there, people who drive them, people who service them and speak that language. That's what we've done.
A lot of it's niching down. That's something that's been totally contrarian. That's not sustainable financially if you did the physical retail store piece. It is sustainable on a larger scale if you mix it in with a big eComm play. That's how you can do it. A lot of stores are going that route too. There are a lot more stores that niched down to the specific customer segment that they serve. They predominantly serve them online, but they have a good in-store experience. That's a key way to do it. That's definitely been contrary in our industry. A lot of people that are in the bicycle industry that come to our stores, their eyes are wide open, like, "This is awesome. How does this work?" From a customer standpoint, if you're a customer and you are a high-end mountain biker, you spend $10,000 on your bike and you buy a lot of gear. It's your favorite hobby and you go to a local shop.
You're talking to some teenager who's used to selling beach cruisers that don't know anything about your bike, that's a bad experience. Even if you're talking to a road biker who never rides mountain bikes and knows nothing about your bike, that's a bad experience. Being able to niche down into one little thing when that high-end mountain biker walks in the doors and he looks around and he talks to people, he's like, "This is my place. I'm never going anywhere else." That's something we've created from a retail store experience that is what captivates people and keeps them coming back because they realized like, "There's nothing like this. This is where I go. This is where I shop."
Dustin
Jeff, you mentioned customer education. I saw somewhere that you're known as the dude in YouTube videos with the funny hair. I got to ask about the hair. Is this like a Donald Trump kind of hair?
Jeff
I have a funny haircut for sure. It's the natural way my hairline grows and what my hair looks like. I do a lot of our YouTube videos. I enjoy it because we try to put out a ton of good content. A lot of it's written. We do play on YouTube quite a bit and a lot of it is consumer education. A lot of what we're doing consumer education for on YouTube is to basically put out content that's not only helpful and valuable to customers in the industry, but it's also fun and has humor. It allows us to be transparent and connect and relate to people because in any business one of your goals should be if all of your customers if they like, know, and trust you, they're going to shop with you. That's huge in retail.
For us, another way is that we're always trying to aim at what are our competitors are doing in this industry and how can we compete in a way more sophisticated level. All of the competitors, a lot of people don't like, know, or trust them in any way. Sometimes they might like them because they've done business with them and had an okay experience, but they don't know them. They don't know who the CEO is. They don't know who the employees are. They don't know who they talked to when they call. They're faceless.
A lot of what we've done is create a YouTube channel that is all about product education and helpful stuff that our customers would be looking for. It's also a way for us to engage and the best way to engage with a customer over the internet is through video. They can get to see who we are, how we laugh, we make jokes about and relate to us, and build that relationship over the internet. That's what we've done on YouTube. I'm typically the character in most of the videos and I do have funny hair. I got that reputation.
Dustin
What has surprised you about YouTube or creating content for your customers? Does anything come to mind in terms of what has happened along the way that you hadn't anticipated?
Jeff
In many industries, especially ours, you can write a good lengthy article with good photos. Google will typically send people there. If it's a good piece of content, Google will send people there. Granted there are some more aspects to that in terms of SEO. Written content will bring you traffic. Sometimes if that written content is good, people will read it and maybe they'll buy. If it happens to be a type of article that's educational on something that they're interested in buying, it might work well for you. You can typically track it pretty well. You can see how many people came to that article, how many people ended up buying, do they look at other pages on the site, did we get an email from them?
You can do a lot of that. What's been surprising about YouTube is that it goes so much deeper than that because when people get to see your face and listen to you talk and listen to your opinions, they get to know you. There's that character development aspect of it too. They're watching you on film and watching people from your company on film. They're getting to know people. They're relating to those people there. That character development that you get is huge. It builds trust. It makes people feel like they know you when they've never met you in real life.
That's playing the long game because it's harder to quantify. It's definitely more of upper funnel advertising, but it has been an eye-opening to me to see how many people have got to know myself and our business through YouTube and instantly relate to us and feel like they're friends with us. Become these loyal fans of not only us and our channel, but of also our company and our brand. That translates into this is the place that they shop because they know me. I've ever never even met them in person. The video is amazing and depending on the industry, it's hard for me to imagine anyone that shouldn't have a strong YouTube game right now.
Dustin
Jeff, I think this ties into some of the growth that you have and folks that are getting to know you, the WealthFit nation. Jeff, you have millions in revenue, two-time Inc. 500, Entrepreneur 360, list all before 30. Is this content education one of the critical factors? If so, what are the others that have contributed to epic growth of Worldwide Cyclery?
Jeff
The content marketing and all of that stuff absolutely have a lot to do with it. I think about this question a lot. I've had a business coach in the last few years that is always driving that same question, do you truly know why your business is growing? You got to ask yourself that. Whether your business is failing or growing, do you actually truly know why? Not guessing, not thinking, not theorizing and not dodging or being afraid. That's usually the case if it's not growing. Those are the questions he's always posed to me and I've always thought about pretty in depth.
It is interesting because it is a little bit of a commodities business. We didn't come out and invent something new or do anything crazy. We came out as a sophisticated, good retailer that leveled out the playing field. We do need to understand why we are growing. For us, there was no one single thing. It was a combination of a lot of things that I always look at in business. In order to succeed in a saturated competitive market, which is probably most markets anyone is going to be playing in these days because we're in a pretty developed society, it's pretty hard to have an original idea. I'm always looking at you got to be superior. That could be one huge thing that you're superior and that's how you're beating your competition or that could be a whole bunch of small things that are superior to your competition, which adds up to your overall business being far superior. That's how it's going to steal market share and grow and do well.
That's been the case for us. It's not one single thing, but it's a lot of small things that we've figured out how to do that has helped us grow. It's been good content marketing, connecting with customers, an interesting technology platform that's definitely better than what our competitors are utilizing. It's better customer support. It's that connection with people. It's product selection. It's understanding the industry. It's understanding of the niche. It's doing a couple of contrary and things here and there. Nothing monumental or crazy. It's almost like the death by a thousand paper cuts. That's what we've done and worked at over the years to figure out how can we have a competitive advantage, where are our competitors weak? We're always thinking about how we can improve and how we can find new and unique little competitive advantages. If you spread a bunch of little small things all across, it ends up to your business being pretty superior. Therefore, you're able to eat and take market share and grow well, which has been the case for us.
Dustin
You said in your first three years you hadn't spent money on marketing. You grow those years and you did some incredible growth in those years as well on strategy and tech. Do you think you'd be able to accomplish that now if you had to start over?
Jeff
I don't think so. Back then a lot of what scaled us in those first few years was cracking the code when it came to multichannel. Multichannel doesn't just mean you sell online and you sell in the store, but it means you sell on eBay, Amazon, your website and in store. We have a lot of products. We have about 20,000 products that we have on our site right now. Getting those on eBay, on Amazon, on our website, and having all the inventory levels synched and all the pricing synched and the product data looking good. That's a challenge from a technology standpoint that we figured out in the early days and some more people have figured that out now. Back then that's a lot of the reason we had pretty substantial growth because we were literally putting products out that people wanted to buy online, but they legitimately couldn't find them online.
That was a very plausible thing in 2011, 2012, and 2013 for us in our industry. Whereas nowadays it's not. It's like most industries over time, more and more sophisticated competitors come in and more people copy them and they imitate them. The whole industry becomes a little bit more evolved in terms of what consumers are experiencing. Nowadays, it would be harder to jump in and do that. Things change. That's what helped us grow for those first two and a half, three years. What is going to help us grow and get to the next level wasn't that anymore. Where did the competitors catch up? Where did two-day shipping become normal? Where are we at now that we need to find other ways to acquire customers? Things always evolve in business in terms of how you're acquiring your customers and how you shift your strategy in order to continue to pivot to keep taking market share and keep growing. It always changes.
Dustin
Jeff, you've had incredible success. You have won awards and created insane amounts of revenue. Despite all that, you're most proud of the team. Why?
Jeff
For me, I play the game of business for a couple of reasons. I liked the impact that you can have in an industry on thousands of customers that give them an experience that they would have never gotten without your business being there. You're leveling up the experience customers are getting and making people happy and stoked to do business when you weren't even there. On the internal side of that, it's the team. Business gives you the power to build a company where you can control the culture. You can make a great company culture where people have fun. They feel fulfilled. They enjoy the people they work around. They enjoy the products they work around. They feel comfortable in their own skin and confident and happy when they're in their work environment. That goes a long way. Those are the two things that I get the most enjoyment and fulfillment out of in the game of business, which is why I like to keep playing and keep scaling because I love seeing both of those things change and evolve.
Our team now is so cool. We have a couple of locations, soon to be three. We've got over 30 people now. Spending all this time building a company culture where people truly enjoy, have fun, and feel good at each day at work, that to me makes me feel good. It's having a team of such passionate, cool, fun people. Because they enjoy themselves, they work harder and do more and think more. Being able to give people that is a fun thing that I think is cool about business. We've been so lucky with getting amazing people over the years and being able to maintain our culture as we've grown. We've grown fast and done something, but it's not Silicon Valley growth by any means. It's not like we went from 10 people to 250 people in two years. No way. We're still a fairly small company in the scheme of things.
It's been fun. I'm definitely most proud of the team, the people here and the company culture that we've all been able to create and maintain. I read a book in the first few months of opening the business. When it was basically me by myself in a little shop called Delivering Happiness by Tony Hsieh, the Zappos guy. That book made such a lasting impact on me in terms of how much more business can be rather than just a fun way to make money and make a profit, but also a way to impact customers' lives and impact employees' lives internally in a way that's would have never been done unless you stepped onto the field and played the game of business. That book left a huge impression on me and something that I've always put a big focus on is the team and is our culture. I’m definitely most proud of that and the people here, what we've built internally.
Dustin
What's something unusual you do to either keep team members engaged or have fun with culture? When I say something unusual, it’s probably usual to you but unusual to the outside world or folks looking in.
Jeff
We definitely do probably unusual stuff. One of the things that I think people get caught up or confused about these days is like perks. It's like, "Company culture is having a ping pong table and all that stuff," which is total BS to me. I focus on company culture of where people feel comfortable. I care about making people feel good inside. I feel like people, when they're in a comfortable environment where they can truly be themselves, they feel like they're not going to be judged or ridiculed. They feel like they know people and people know them so they get to express themselves, how you feel when you're at home and with your family. You feel good, you feel comfortable in your own skin.
That, to me, is a key thing in company culture. We've always tried to create that. In terms of small little unique things that we do, one of the things we've done which, you'll appreciate is we have a reading program. The way the reading program works is you get $20 an hour to read books. It's based on audiobook time. The book has got to be recommended or approved by me. A lot of the books are about personal development and business and relevant stuff. Not like Harry Potter or anything like that. Relevant type of personal development, educational books. You get $20 an hour to read the things. You got to write a little report at the end of it, that's your three biggest takeaways and how you're going to implement them in your life. You've got to email me that report and then preferably if you're comfortable, share it with the whole company.
People are getting paid cold hard cash to read books and get smarter and then also share it with the team internally. That's been a huge win for us. It's interesting because, from an internal standpoint, it's been great to see not only people learn, grow, develop and change, especially because we're in the bike industry, we have a lot of young Millennials, people in between the age of twenty and 32 here. To give that to people and see them learn and grow from this reading program has been super fun and fulfilling. It's also a useful tool for me as a leader to evaluate my people. One of the harder things to do as a leader of a company is to understand when to push people and when to not push people. It's taken me a while to learn as a leader. It's been a big leadership lesson is understanding that because I might want to read and learn, focus, work hard, work fourteen hours a day, get the most out of life and do all this, that's my mentality and my lifestyle, in no way does that make me right. That's how I am. That's what makes me happy. Someone else and how they behave, act and do might be what makes them happy. Who are you to say they're wrong?
That's been challenging for me to learn. The reading program has helped with that because when people do read books and they write reports, it gives you a good insight into their mind. It also allows you to see we have certain people, we do have our own fulfillment. We've got a lot of people at work in a warehouse. Most of which are getting paid less than $20 an hour. They could literally be making more than they make on an hourly rate going home, reading books, but they don't. Is that right or wrong, that's beside the point. The point is it helps you know who's after it. Who's like, "I'm working here. I want to succeed. I want to do more. I'm going to read books. I'm going to kick ass here." Who are those people? Who are the people that are here because they’re like, "I love bikes. I want a comfortable work environment.
I want to enjoy myself. I'm happy staying at the same pay scale for years and years as long as I have these certain needs met." It helps you as a leader evaluate your people and to see how aggressive they are towards success. When I introduced the reading program a few years ago, I said it's subject to change. There are no limitations so you could literally read ten books a month. I never told anyone they couldn't. I've never had to pull back because you'd be surprised. Cranking out books is not easy to do. That's been an interesting tool for myself to use as something to analyze people. To see and understand what's going on inside of people's heads and help people learn and grow. That's something that's definitely unique about our culture.
Dustin
Is there any book that sticks out that got more buy-in from the team?
Jeff
Start with Why by Simon Sinek. A lot of people here have read that and like it. We're pretty clear about our whys of why we're here as a business and making sure we have clarity on why we come here each day, why do we exist as a business, and why does it matter to us and our customers and everyone else. That's been a good book that's resonated well and especially something we do is when people get hired, they have to memorize those seven whys and then they have to recite them in front of basically the whole company. They get $20 once they're done, which always ends up being funny in somewhat of a heckle fest. It's fun. Start with Why by Simon Sinek, I love that book and that's resonated well. The other one, surprisingly in this one I didn't even introduce was Extreme Ownership by Jocko Willink. Somebody read it and recommended it. Almost every person in the company has read that at this point. That book has resonated. People love that book and get a lot out of it. Those are probably the two most notable books that have made a splash in terms of our company reading program.
Dustin
Jeff, I want to move us into WealthFit round, which is my fancy way of saying rapid-fire questions. What's been your most worthwhile investment?
Jeff
I would say entrepreneurial gatherings. Things like EO, Baby Bathwater, networking and spending time with other entrepreneurs in cool event settings. That's been it for sure. Baby Bathwater is the number one. They put on amazing events for entrepreneurs where I've learned a ton and had so much fun. All those things are costly. They cost money and time but it's worth it to get to learn from other entrepreneurs and relate and connect with them.
Dustin
What's that investment you'd rather not talk about?
Jeff
Lending Club, peer to peer lending, I thought, “This looks like an interesting way to move money at 10%.” You're looking to Lending Club, that whole thing didn't work out as planned. I luckily didn't lose too much money on it. The whole peer to peer thing, I was like, "This seems brilliant." It totally sucked. It didn't work.
Dustin
When life is good, business is rocking, and you want to splurge on yourself a little bit. What is that guilty spend?
Jeff
I don't have many of them. I'm a pretty frugal minimalist person, but I do have one. It's a clothing brand called Pistol Lake. They make these ridiculously expensive clothes. They're like super nice, functional, athletic casual wear. They're like $90 t-shirts. They're so comfortable. They're worth every penny. I buy that and I'm like, "This is ridiculous spending this much money on clothes." Probably a lot of people do that. It's unusual and a guilty pleasure for me regardless of if that's normal for you or other people.
Dustin
A lot of entrepreneurship is staying away from shiny objects. I'm very interested to know in a year or so, what have you become better at saying no to?
Jeff
This is probably more so in the last few months, I'm saying no to travel and also those things I said my best investment, it was like entrepreneurial gatherings, those can be hard to say no to. They're not all created equal. Some of them are valuable and have good quality people. They are a lot of fun to go and experience and enjoy. It's a little hard to vet them. Sometimes it's challenging. It's like, "This could be life-changing, educational, fun, fulfilling." It's a good four-day trip to one of these conferences or something like that. It's been hard. I got almost addicted to that. I was like, "I got to go to that one, that's going to be fun. I'll meet some cool people there. I got to go to this one."
The next thing you know, I'm traveling to things like that five days a month and not getting much work done. Those have been useful, but also I've had to tone back. I'm going to the quality ones this year that I know are going to be good and I know are going to be worth my time and investment. Travel is one of those things that when your budget is good, it's not hard to go travel and go to and attend these events. You always have this justification of like, "It might be super useful and beneficial." At the same time, you got to be cautious because not all of them are. That's been something I've been working on and trying to make sure my calendar doesn't get too booked up with travel. I have time to not learn but execute and get work done.
Dustin
Jeff, do you have any special rituals or routines that you do to achieve at the level that you do?
Jeff
I always look at some of those is I'm not sure if they're commonplace or not. For me, doing stretching and a little bit of exercise in the morning is huge. I always like to exercise throughout the day. I’ll work for a couple hours or so and then crank out 40 pushups or swing some kettlebells or something like that. That stuff is good. Making sure to time block and be cautious with my time. Probably the biggest thing for me that I've been working on is always asking myself, “What's the most important thing I should be doing right now?” Whether this day, this hour, this month, this year. Having clear cut objectives that I make sure are the most important thing, the most important way I can spend my time and make that a mindset.
It's easy to say like, "I'm going to think about that right now." I've got that so habitual in my brain that no matter what I'm doing, I'm always questioning like, "Is this the right thing to be doing? Is this the most important thing? Is this what's going to help me achieve my goals and get to where I want to go and accomplish things I want to accomplish and allow me to live the life that I want to live?" I'm constantly thinking about that stuff. Not in a detrimental way by any means, but in the way that I'm always double checking and making sure I am living the way I want to live, behaving the way I want to behave, doing the things I want to do, accomplishing the right things, working on the things that will help me accomplish those things I want to accomplish. That's been huge because as you scale a business, you get inundated with people who want your time and this and that. It's definitely hard to stay focused on the right thing and end up not making any progress.
Dustin
Jeff, we truly appreciate you being on the show and sharing your story, sharing your wisdom and nuggets along your path and your journey. For folks that want to keep up with you and see what you're up to in the world and maybe buy one of those awesome bikes that you have to offer or some accessories to go along with bikes they already have, how can they do that?
Jeff
I don't partake in social media. I'm on Facebook, but I almost never poke in there or do anything. You might catch me at a Baby Bathwater event or YC event. I'll be at some of those here and there. I'm quite a bit on our YouTube is where I appear the most. Our YouTube is Worldwide Cyclery. That's what we are on social media everywhere. YouTube and Instagram are where our company plays the most. Even if you're not a mountain biker, you'll probably still appreciate how beautiful nice bicycles are. @WorldwideCyclery is where you can catch me there. On Facebook too, I'm the only Jeff Cayley on there. Maybe one of these days I'll get with the times and post some stuff on Twitter, but I don't care. I'd rather do something else at this point.
Dustin
Jeff, again, we appreciate you being on the show and sharing what you do.
Jeff
Thanks for having me, Dustin. I appreciate it.

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