FORTUNE Small Business

Surfer Steve's excellent retail adventure

Kahuna Creations founder Steve McBride ditched the corporate world to build a company around his love of surfing the waves.

EMAIL  |   PRINT  |   SHARE  |   RSS
 
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)

kahuna_creations.03.jpg
Kahuna Creations artist David Ray Gould (on left) and founder Steve McBride brought their summery wares to last month's Outdoor Retailer Winter Market.
kahuna_creations2.03.jpg
Cory McBride demonstrates Kahuna's Big Stick.

(FORTUNE Small Business) -- It's the dead end of winter. Mountains of work need to get done. Economic uncertainty looms. It's been a long year - and it ain't even April yet.

Time to huddle up, my fellow small business owners, and revel in the simple story of one Mr. Steve McBride. McBride, 45, is living a classic small-business dream: He's building a surfboard company. He is the owner/rider (that's his real, official title) of Kahuna Creations, an Ogden, Utah-based surf, skate and snowboard company whose wares now retail in more than 200 shops across the country.

McBride's classic designs, respect for the traditions of surfing, and total lunatic authenticity have made his boards some of the best sellers in the stores that carry them. He says his products regularly outsell out enormous rivals like Rusty, Hawaiian Island Creations and Town and Country Surf Designs.

How did he do it? Think Jerry Maguire, but for surfing.

Back in 2002, McBride was a marketing executive for a large Silicon Valley computer storage company. He and his wife DeNee were in Australia for a crucial marketing meeting. The plan was to leave his wife at the beach, drive over to the meeting in the rental car, lay down the message, and head back for some major surfing. But on the way, he got turned around, ended up lost, wrecked his car, and showed up at the conference so flummoxed that he gave the worst pitch of his life.

"And that was it. I went back to my wife on the beach, grabbed the board, and had the best session of my life in the waves," he says. "I knew I was done in the computer business."

Thirty days later, McBride had quit his job and was sitting at home with a vague notion of starting "something in the surf business." He quickly dismissed owning a shop as too complex. Soon, he decided he would try to make boards - even though he had limited actual experience in making surf boards.

With his background in sales and marketing, he and his wife - who, by the way, supported his every move from day one - realized something very interesting about the surf board business.

"It's all rooted in the Annette Funicello, Beach Boys, '60s vibe," he says. "There was no brand that got its roots from the ancient traditions of the sport."

And so was born Kahuna Creations, a surfing brand that takes its cues from the 2,000-year-old heritage of humans riding waves on flat boards. The brand features hand-created art, a love of classic surf designs, and prominent use of natural materials. Wood and sand abound, along with simple graphic patterns.

To get his company off the ground, McBride decided to start with the smallest possible board: With $10,000 of his own money, he developed a logo and design for a skateboard.

"I figured I could sell those everywhere," he says.

He hired a local carpenter and made a production run of 20 prototypes. McBride then loaded up the back of his Ford (F, Fortune 500) Explorer, packed his then-16-year-old son Cory into the passenger seat, and took off on an old-fashioned, unscheduled, two-week road trip to sell his boards to skate shops. By hand. Out of the back of his truck.

"My son and I would pull into these big mega stores, and just ask the guy at the counter 'Who buys boards?'" McBride says. "He would point to the back. And we would go straight in, unannounced, and sell the buyer."

Remarkably, McBride cleared all his inventory, selling two dozen boards to an equal number of shops across the West.

"It was like, wow, we just paid for dinner!" says McBride, remembering that first sales trip. "That burger we bought with that first sale was pretty sweet."

Emboldened, McBride qualified for a $150,000 urban development loan from the City of Ogden.

"That was great," he says. "All these high tech companies vying for that money and they give me, the crazy guy with the surfboard company in Utah - no oceans here - the money."

He matched that with $150,000 of his own money - "I am all-in on this one. It pretty much has to work or I am toast" - and invested the $300,000 in a fuller line of skateboards, snowboards, and long boards for surfing. His production is split between high-end boards made by craftsmen in SoCal and less-expensive "value" boards made in Asia.

And his marketing "strategy" is fairly unique. McBride recently turned up at the winter - remember that, winter - Outdoor Retailer Market in Salt Lake City, the largest trade show for the outdoor retail market.

"Hey, I was the only surfboard vendor there!" McBride says. At the show he demoed a completely nutty, but marvelous, skateboarding contraption called the Big Stick. It's essentially six-foot-long pole that pushes skaters along the road - no need to push off with your legs.

McBride is running at break-even this year and hopes to pay himself within the next year, though he would not disclose his specific revenues at this point.

"Basically, I did what I said I wanted to do: Prove that there is a business in a classic surfboard company based in the roots of the sport - something that kids think is cool but adults can use and enjoy," McBride says. "With the right backer, we can go step-for-step with any brand out there. I'm living the complete dream."

Amen, brother. Amen.  To top of page

Share your take on Kahuna Creations and McBride's entrepreneurial adventure in our discussion forum.

Rough surf: A foam core supplier shutdown throws an industry into turmoil.

Best summer gear: Cool products by small companies for hiking, biking and more.
Features
They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
Inside the $50,000 Emmys swag bags If getting nominated or presenting an Emmy award isn't prize enough, celebrities come away from TV's big night with luxury goods and vacations worth $50,000. Take a peek at some of this year's luxe giveaways. More
10 most expensive cars sold at Pebble Beach These multi-million-dollar cars sold for top dollar at this year's Pebble Beach collector car auctions. More
The world's most popular beer is ... Few people outside China have ever tasted the top-selling brew in the world. More


Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.