How the Creator of Dugout Mugs Hit a $30 Million Home Run With a Business He Started in His Apartment

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Luck? In the suitable place on the proper time? Or neither? I just lately had a go to with Kris Dehnert, founding father of the Dehnert Media Group and an professional in scaling companies, and Randall Thompson, former Minor League Pitcher for the Toronto Blue Jays and creator of the mug-from-a-bat Dugout Mug. In simply over 5 years they’ve grown the now ubiquitous Dugout Mugs model from a one-man thought to a world enterprise with near $30M in gross sales. However how does an organization scale this rapidly? And what occurs subsequent? 



Dugout Mugs

A little bit of background

Randall Thompson, designer of the bat-to-mug idea, had lived and breathed the sport of baseball from the time of his first Little League T-ball recreation at age 5. He was hooked. Via onerous work he progressed from collegiate sports activities to skilled baseball, inducted by the Toronto Blue Jays as a free agent in 2011. It was the dream of a lifetime however got here to an finish upon his launch in mid-2012. Thompson returned to his residence base of Orlando however was nowhere close to able to retire. He took a place as a school pitching coach however felt “an identification disaster taking place” and resigned from teaching. He took an unpaid internship at an advert company in St. Petersburg to discover his artistic facet, which he funded by ready tables to cowl the hire on a indifferent garage-turned-studio condo from his sister. 

The company function fell aside at about the identical time he was fired as a waiter. With no cash for hire, he was residing very actually in his sister’s yard. It was then he recalled an thought he’d tucked away whereas teaching. Why not flip the barrel of a bat right into a consuming mug? It was not a dream or a imaginative and prescient, however the easy recollection of watching a fellow coach creating an equipment for a “give attention to the fingers” hitting drill. To carry his level residence, the coach had minimize off the highest of the bat and left it on the bench whereas the gamers labored with the deal with. The thought hit Thompson like a little bit of lightning: “I may simply create a method to serve a drink from a bat.” It appeared easy sufficient. Now that he had nothing else going, why not give it a strive? 

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Together with his first earnings from a paint supply job, Thompson bought 25 craft bats and a chop noticed from Lowe’s. He labored the supply job from 6:30 a.m. to about 2:30 within the afternoon, at which level he would shift all of his power to the brand new enterprise. The primary Dugout Mugs had been born from the kitchen counter of the studio condo. With out a plan to scale or a construction for advertising, he superior the fledgling enterprise for its first 6 months through the use of the proceeds of the primary 25 mugs to construct and promote 100, then 500, and at last 1,000. The vast majority of the gross sales got here from merely introducing the concept on Fb, however Thompson had additionally gone so far as strolling across the parking space of regional video games promoting the mugs he’d personalized with generic baseball-themed logos.

Two guys walked right into a bar… 

How did Thompson and Dehnert meet? Fittingly, the preliminary contact occurred on Fb in a gaggle for former Main and Minor League baseball gamers. Technically, Dehnert shouldn’t have been within the group, however Thompson laughingly admits, “Kris has a method of being in the suitable place on the proper time.”

Dehnert had posted a couple of nation music live performance close by in Thompson’s spouse’s hometown. This raised his curiosity.  He clicked on the hyperlink and discovered from Dehnert’s profile he was in shut proximity and that he’d been notably profitable at ecommerce. Intrigued, he reached out, saying, “I’ve seen you’ve offered a bunch of issues on-line and I’m attempting to determine how to do this, and how one can construct what I’m doing at an even bigger scale.”

“We ended up assembly in a resort foyer for a beer and talked in regards to the prospects,” Thompson recollects. A number of months later their first work collectively started. 

Fortuitous connections, and a near-death expertise 

When the assembly occurred, Dehnert was in St. Petersburg for a Board of Advisors mastermind occasion. Intrigued by what he’d beforehand heard on the telephone, he invited Thompson to swing by and have a beer, admitting it was an attention-grabbing idea. After their assembly, Dehnert carried the knowledge again to his occasion session and talked with a number of different entrepreneurs in regards to the thought. The suggestions was divided, however the majority agreed it was a cool idea and proper up Dehnert’s alley. Recent from a transformational shift in his life, Dehnert believed this was greater than irony. 

Dehnert had been significantly sick within the months earlier than the St. Petersburg assembly, to a degree he had genuinely feared he would die. Nonetheless in his thirties, with a six-month-old daughter, he started to hope fervently to survive, and past this, be directed to somebody or one thing that may enable him to give attention to household, stay an experiential life, and leverage his distinctive abilities. This seemed to be the undertaking he was looking for, and Thompson seemed to be the particular person Future had positioned in his path

Associated: Have a Lot of Clever Ideas? License Them to the Novelty Gift Industry.

Dehnert sensed in Thompson and the Dugout thought the foreshadowing of one thing far past a one-person enterprise. It was a “diamond within the tough” — a doable unicorn – within the fingers of an proprietor/operator with a imaginative and prescient of one thing distinctive. “This was a undertaking I felt I may run with, and Randall was gritty like me,” he recollects.

With Dehnert driving gross sales and Thompson heading the operations, the 2 “broke each system within the place.” They recreated and ruggedized their enterprise mannequin for the power to ship at scale. In six months they achieved a $1M valuation, which allowed them to carry of their first and solely monetary backing: $250,000 within the type of a $100,000 mortgage and a $150,000 line of credit score. 

The investor was one among Dehnert’s mastermind colleagues. He says of the dialog, “I would been wanting to discover a deal we may do collectively as a result of I really like Kris’s model. When he known as, I used to be in.”

From there, the corporate has leaped ahead in orders of magnitude. In 2017, they produced $1.2M. The subsequent yr, they produced 2.2 – then 3.5, 8.5, and $13.5 million – which remarkably occurred throughout the pandemic and a yr wherein virtually no baseball was performed. 

The constructing of an unimaginable tribe 

Of all of the contributing components to Dugout Mugs development, the founders agree that betting on folks has been their high “secret sauce.” Certainly one of their core beliefs is “give attention to the folks, and the enterprise will handle itself.” This has resulted in an enormous and various tribe of followers, buddies, followers, and prospects that span most all ages and surprisingly at the very least as many ladies as males. Whether or not or not it’s internet hosting fan-centric giveaways, or interviewing baseball stars like Pete Rose, Mariano Rivera, Pudge Rodriguez, David Mickey Evans and others, Dehnert and Thompson have labored to create a “followers first” expertise for all.

Through the pandemic, folks yearned for connection, which made them delighted to listen to from nice names in baseball as they made digital appearances to speak in regards to the sport. The corporate went “all in” on contests, giveaways, and different interactions with followers. The presents included TVs, beer cash, and tens of 1000’s of {dollars} in free mugs and autographed gadgets. In circumstances the place folks had been extremely engaged however couldn’t afford to purchase one thing, the corporate gave them a mug and invited them to pay the favor ahead. 

Dehnert has a favourite saying: “Irrespective of how far or quick you fall, assist sufficient folks and also you’ll by no means hit backside.” He estimates the staff amassed some 50,000 new prospects throughout 2020 by artistic practices comparable to a free shot glass once they made a purchase order, for the power to observe up after a sale with an surprising likelihood to generate good vibes. 

“The place can we go from right here?” 

As Dugout Mugs has damaged by income obstacles, the apparent query is how one can progress additional – acquisition by a significant model like CocaCola, Fanatics, or Yeti? An IPO? 

This, I imagine, is the place Dehnert’s recommendation is becoming for each entrepreneur. The byword of each choice is ‘strategic’, he stated in our interview, noting, “You may’t simply grasp an indication over your organization that claims, ‘purchase me – we’re on the market’. The key, he says, is identical for each a potential acquisition or an IPO: Function an organization that doesn’t have to be purchased. 

That is counterintuitive to the tendencies of many house owners, who are inclined to prioritize development above high quality, group, and sound fundamentals (“ubiquity first — profitablity later’) within the hopes somebody will “discover them” and pay a rare valuation. However suppose the market and circumstance change? (Circumstances in level: WeWork, and the sudden explosion after which implosion of co-working area, or the rise and collapse of conventional retail.) Firms with deftness and intuition can journey the modifications with expanded choices, model loyalty, a tribe of aligned and delighted prospects, and strong financials, Dehnert maintains. These are the strengths that help innovation and may climate the challenges of political strife, pandemics, and provide chain malaise. 

With this strategy, it might by no means be essential or fascinating to promote. And in the event you do select to exit, you’ll be working from a place of power versus being cornered ready of desperation or want. 

As for PR, Dehnert is more and more in favor of being selective. He positions his firm in probably the most supreme media and most fascinating settings versus chasing each likelihood for visibility he might even see. “It’s all about positioning, the leverage of money and time, and the very best use of our expertise and sources,” he says. 

The place will this lead, and what’s going to Dugout Mugs finally obtain? Time will inform, however the consequence is bound to be a cheerful one as Dehnert and Thompson proceed to innovate, invent and proceed to develop each an organization and a way of life by artistic thought and design. 

 



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