Article from Kabbage.com
Toilet tissue is not most people’s idea of a glamorous business – but just like any industry, it offers opportunities to savvy entrepreneurs who know how to spot an underserved market. Sean Riley and a few of his friends decided to start a business called Dude Wipes, selling flushable wipes marketed to men, because they felt like it was a useful product that wasn’t being branded in a way that was relevant to the male demographic.
A few years later, their company has won a national award and has built an audience by partnering with a Mixed Martial Arts (MMA) fighter, a pro skateboarder, and a national music festival. Maybe toilet wipes are more “glamorous” than most people might expect?
We talked with Sean Riley from Dude Wipes (who is also a Kabbage customer) about his company’s founding, how they stand out from the competition in the fast-growing flushable wipes category, and what other small business owners can learn from their success.
How has being a Kabbage customer helped you to grow your business? Can you share details about what you used your Kabbage funds to buy?
We used Kabbage funds to launch our second product. Originally we came out with individually wrapped single wipes for guys on the go – to use at the office, at the club, outdoors, that was the pain point we saw, where someone might see our product and think, “I’m an active guy, I need this portable solution.” Then we quickly realized that we were going to need some capital to do our next product and take things to the next level. So we opened a line of Kabbage credit to make things a bit more comfortable – thanks to Kabbage, they were part of our success in launching our second product.
A lot of small businesses struggle to get loans from banks, and we found this to be true as well. You can’t get a loan from a bank unless you’ve been in business for 2 or more years, and you need to fill out 3 inches of paperwork, and provide the partners’ tax returns and all of these other steps. We were a brand new company, so we just couldn’t get a loan in the traditional way. And when we found out about Kabbage, we couldn’t believe how easy Kabbage was – we could apply online and get the money really quickly.
Do you think you might have had trouble finding external capital/investors/loans in part because people don’t believe that a personal care product like Dude Wipes can come from a small startup? (For example, most of the time at the grocery store, you only see flushable wipes from big companies – brands like Charmin, etc.
We talked to a few potential investors, and there was definitely some skepticism to it. We knew we had a good idea. We put in our own money and put in an order for an order of the individual wipes, and we knew we were taking a chance, and we might be flushing some money down the toilet, so to speak. We got some skepticism because there wasn’t another product just like it on the market. Investors want to know, “what are your sales?” Our sales at first probably weren’t interesting enough to investors. But in the long run, it’ll be better that we didn’t get early investors, so we can keep going “indie” so to speak. A product like Kabbage definitely helps companies get from one stage to another, so you don’t have to rely too heavily on investors or the traditional channels of getting working capital.
I read that your Dude Wipes have been recommended as a hygiene solution for camping, hiking, fishing, and other outdoor activities. Did you develop the product with this in mind, or was this more of an interesting niche use that arose over time?
Right after college, the other three founders and I were sharing an apartment. I was buying baby wipes for the bathroom, and the other guys realized, “Wow, this is a great product, but I’ve never used them before.” We hadn’t seen any advertising targeting men our age.
So we thought from an educational standpoint, we wanted to come up with a cool, funny brand that was appealing to guys in a new way. Big brands maybe can’t be, or don’t want to be, as bold as a smaller brand can be. From the beginning, working on packaging, we had some concepts that were really funny and kind of crude, and we realized that isn’t going to work on grocery store shelves. We had to tone it down and rein it in a bit.
Originally we developed it as a product that we would use ourselves as guys who live in Chicago. But we later built a following in the outdoors niche – with professional and amateur anglers – it’s a great community and they need it just as much as guys in the concrete jungle. Another niche audience is MMA fans – we did some advertising there, and that group took to it well.
Also, we want to be clear that women are using Dude Wipes too, and mothers of children – our product is not “just” for guys. We really like what we’re doing and we’re not trying to discriminate or be exclusionary and say, “we’re only for men” or whatever.
I saw that you won the Visionary Award at the 2013 Vision Consumer Products Conference. What is so unique and innovative about your product, compared to the existing competition?
We won that award for branding. That award is usually given to what’s thought of as the most innovative consumer product of the year. We were up against Kimberly Clark Poise® wipes; our company was not even six months old, we were still working out of our apartment, and we got to the finals of this national award. We went to Orlando for the conference, and all of the finalists got to give a short presentation about why our product was new and unique. I think people saw us as being kind of a breath of fresh air. It was really great to see our idea get validated by the industry – and it was encouraging that they were saying, “You’re doing something important with your branding.”
As far as product design and product quality, we definitely make sure that the Dude Wipes product adheres to all the industry standards for flexibility, making sure it breaks up after being flushed, and things like that. Flushable wipes have gotten some criticism recently from city sewer utilities, but the real problem is not flushable wipes, it’s people flushing baby wipes and other things.
In the future we’re looking to do some different things with fragrances – perhaps some natural oil scents. But our big point of difference is the way we brand and market our product to a different audience that was not being reached before.
What do you think are some broader related cultural trends that are making your product successful? What else do Dude Wipes connect to in the consumer mindset nowadays? For example, are guys more sensitive and aware about hygiene nowadays in a way that they want to take things to the next level of cleanliness and confidence? Are people more interested in active/outdoorsy lifestyles, which make Dude Wipes appealing to take in your backpack to go hiking?
The male grooming market is definitely growing and catering more to men – it’s catching up with the female market. One thing we say when we’re making a presentation to retailers trying to get them to stock our product on their store shelves, is we’ll bring in 10 different feminine wipes that they carry in their feminine hygiene aisle, but then point out the fact that there are none in the men’s shaving aisle. It can be a little harder to “create” a category like that, but I think there is definitely room for growth.
Overall, guys are taking better care of themselves, whether it’s lotions or grooming products. Flushable wipes are definitely growing in the U.S. compared to toilet paper. In Europe, moist wipes are 10% of the toilet paper market, in the U.S. it’s 2% but growing. America hasn’t taken to this type of flushable wipe in previous years, but it’s catching on fast.
What advice would you offer to other startup founders and small business owners?
Don’t give up! We could have given up at several points. But the longer you stay with it and keep pushing, it will eventually work. When you look at the success stories of other businesses and other products, some things pop overnight, but some products take a while longer to get adopted. We still have plenty of places to go and other things to do.
The biggest thing is to stick with it, and believe in your idea. It’s just like shooting baskets in the gym; you keep shooting, you keep practicing, and more shots start going in. There’s that old saying, “The harder I work, the luckier I get” – that mentality is really important, especially when you’re learning a new industry. You might think “I’m just selling wipes,” but no, there’s a lot more to it, there’s a lot more to know about it!
Before we started this company, I used to work for a construction engineering firm doing cost estimates and sales, so this was a new industry for me. My co-founders and I weren’t experts at wipes at all when we started; now we’ve gotten stronger on the product side. Whatever market you’re in as a small business owner, there’s a whole unique learning curve and terminology and marketing knowledge, and you have to catch up on all of that; it’s like starting out at your first job right after college.