You might call it an entrepreneurial dream killer.
It’s a monumental problem that strikes immediately after you’ve taken the plunge; quitting your day job to pursue your side business full-time.
“The transition was not easy,” says Scott Palmer, a marketer and operations pro who experienced this scenario when he dedicated himself full-time to Spikeball, which sells equipment and apparel to people who play Roundnet -- a sport described as a cross between volleyball and four square. “It’s really stressful especially when you have a family depending on you.”
The company’s founder, Chris Ruder, had been running Spikeball as a side business out of his living room for several years. “He’d put the kids to bed and fulfill orders all night,” Palmer recalls.
But shortly after Ruder and Palmer dedicated themselves to Spikeball full-time, fate intervened and posed a hulking challenge formidable enough to crush a lesser company.
“There was a strike at a major port that prevented us from getting our regular shipment,” Palmer says. “We ran out of inventory and couldn’t fulfill orders.”
Even worse, the duo’s lofty goal of doubling sales every year was in jeopardy.
“It looks like an unrealistic goal every year, and this made it worse,” Palmer says.
But instead of allowing this dream killer of a problem crush Spikeball, Ruder and Palmer crushed the problem. “It’s all about learning from your mistakes and managing risk,” Palmer says.
Today, Spikeball splits each inventory shipment between two ports so if one goes offline the company still has inventory to sell. It costs a bit more to split shipments but the peace of mind it brings, as well as a better customer experience, is well worth it.
“The best part was we hit our revenue number,” Palmer says with a smile. “We didn’t think we could, but so far we’ve been able to overcome everything life has thrown at us and double sales every year.”
Even more impressive is that Spikeball is a company founded on a ragtag collection of equipment being held together with nothing more than grit and duct tape.
The Next Great American Sport
Even if you haven’t heard of it…
Roundnet, a two-on-two game similar to doubles volleyball in which participants begin play by serving a ball into a ground-based net (like a mini trampoline) and score points after three touches when the ball hits the rim of the net or ground, has been around for decades.
Ruder continued playing though and kept his equipment, which was battered and bruised after years of use, yet still functional by patching it together with duct tape.
That duct tape laid the foundation for a multimillion dollar company.
It was during a vacation to Hawaii where, despite the equipment’s rough edges, others noticed Ruder and his family playing and became curious. “They were all dying to know what sport Chris was playing,” Palmer says.
The idea for Spikeball was born right there on the sand in Hawaii.
It’s a humble beginning for a business that has grown exponentially and recently celebrated Roundnet’s National Championship tournament in Washington D.C. by awarding a $5,000 first prize. Notably, the sport is now enjoyed by people across the country thanks to the awareness and equipment Spikeball sells:
- Over one million people now play nationwide
- 250 tournaments will be held in 2016
“People love the Roundnet,” Palmer says. “We’re literally building the next great American sport.”
Spikeball, once a part-time living room-based endeavor, now has fourteen full-time employees and two offerings:
- Spikeball equipment and kits that empower people to play anytime and anywhere
- A SaaS platform in which Spikeball enables Roundnet lovers to organize, accept registrations, and run their own tournaments
“We give them loaner equipment and everything they need to operate tournaments,” Palmer says. “It’s really cool to watch the sport grow in real time.”
Spikeball is growing as well.
Since its founding in 2008, the company has grown more than 2,700% and posted record sales numbers each year:
- $1.3 million in 2013
- $3.2 million in 2014
- $6.9 million in 2015
Interestingly, the company’s strategy is to introduce the game to children and offer them opportunities to continue playing as they grow:
- Spikeball equipment is in over 3,000 secondary schools nationwide where children participate during physical education classes
- Roundnet is now a recognized club or recreational sport on 150-college campuses nationwide
“We want to teach them how to play in grade school, offer them a chance to compete in college, and maybe one day beyond that,” Palmer says.
More on what “beyond” means in just a moment.
Remember how Palmer intelligently split port shipments to avoid ever running out of inventory again?
It’d prove meaningless unless Spikeball could keep cyber jerks from bringing down its popular website.
A Differentiator: On-Demand Delivery
Initially, Spikeball had a hybrid site…
A primary WordPress-Shopify combination accompanied by several satellite sites used to sell directly to specific channels like middle schools interested in incorporating Roundnet into their P.E. classes.
“When we were attacked, the WordPress portion of our site went down but the Shopify portion was still standing,” Palmer recalls.
It’s one reason, along with a desire for a platform that could scale on demand and keep up with the growth it was experiencing, that Spikeball migrated its digital properties and upgraded to Shopify Plus, an enterprise-level ecommerce solution for high volume merchants. “We love Shopify and the people who work there,” Palmer says. “We’re marketers, not developers, and Shopify Plus saves us both time and money by allowing us to focus on what we do best rather than worrying about technology.”
In addition to the easy-to-integrate applications that position Spikeball to better manage inventory and upsell, Palmer notes Shopify Plus also allows Spikeball to differentiate itself by leveraging on-demand delivery services like UberRUSH. “We were one of the first companies to launch with UberRUSH,” Palmer says proudly.
UberRUSH, which allows merchants to offer same-day delivery in select cities, positioned Spikeball to offer last-minute holiday shoppers in Chicago, where it’s headquartered, a valuable service. “Typically customers would need to order six to seven days prior to Christmas to ensure packages arrived in time,” Palmer notes. “But with UberRUSH customers could order all the way up through Christmas Eve and still get their Spikeball kits in time.”
Here’s exactly how it worked during the 2015 holiday shopping season:
- Spikeball selected the products eligible for UberRUSH delivery and kept the inventory on hand at its Chicago headquarters
- Customers entering their zip codes during the checkout process who were in the pre-selected delivery zone were given the option for same-day delivery
Palmer was on hand as the first several UberRUSH orders rolled in. “The doorbell rang, and it was the UberRUSH delivery person,” Palmer recalls. “It was so cool the guy actually showed up after the order was placed.”
Shortly after that, Palmer and the Spikeball team reached out to the customers ordering with UberRUSH to confirm receipt. “They got it the same day- it really happened,” Palmer says excitedly. “Listen, it’s not like it allows us to compete with Amazon in terms of delivery, but it made us feel like a big important company adding real value for our customers who are in a hurry.”
On-demand delivery isn’t just for holidays.
Spikeball offers UberRUSH year-round and one day, if all goes according to plan, possibly well beyond Chicago.
#1 Marketing Expense: Free Replacement Parts
It’s nowhere to be found on Spikeball’s site.
And it’s not something for which Palmer and his team market or actively seek credit.
But Spikeball’s secret sauce is this; surprise and delight customers.
It’s something you may have heard others promise but here’s how Spikeball actually delivers and why Palmer suggests customers love it:
“We replace parts for free for life. People will actually call and ask if they can purchase a replacement part because something has broken. Our answer is no- we will NOT sell you a replacement part. What we will do though is give you the part you need absolutely free. Customers are amazed by this which is the point- we love surprising and delighting them. We care about facilitating the playing of the game and people can’t play unless they have equipment that functions. We do this no questions asked and we cover the shipping which really resonates with customers. So it turns out, free replacement parts are our number one marketing expense.”
The customer trust that’s earned, especially when combined with Spikeball’s strategy of introducing the sport to children and nurturing love of the game through college, may one day bear fruit on much larger stages; Spikeball is actively working on making Roundnet:
- An Olympic sport
- An NCAA sport
- A professional sport
“Eventually we want to have global rankings like other major professional sports,” Palmer says. “We’re having conversations with organizations like the United States Olympic Committee and are doing everything we can to grow this sport.”
Lofty goals for sure...
But obviously no match for a Spikeball team that routinely conquers ports closed due to worker strikes, achieves seemingly impossible sales goals, and offers on-demand shipping that’s surprising and delighting the Roundnet world.
“We’re introducing people to the sport every day,” Palmer says. “We’re really proud of what we’ve accomplished, the community we’re building, and a future in which Roundnet is as mainstream as any of America’s great sports.”