The year is 2009. In history books, it'll widely be recognized as the year that most of America -- heck, the world -- would prefer to forget. Job after job was lost, bank after bank fell, and humanity as we knew it plunged into "the worst recession since the Great Depression." It's also the year that Palm attempted a comeback with webOS, and as it turns out, the year that yet another accessory company was born. While such an occurrence may be forgettable on a macro scale, economic researchers and lovers of technology alike have reason to take notice -- and, indeed, ask questions. So, that's exactly what I did.
Beyond growing a technology startup in a me-too field during the worst economy that I've personally been a part of, it's also not often that I find compelling consumer electronics companies far outside of New York City and San Francisco. Twelve South just so happens to be located in a nondescript nook in Mt. Pleasant, South Carolina -- just a beautiful trip over the Arthur Ravenel Jr. Bridge from historic Charleston. Three years after its founding, the company now fittingly counts a dozen employees on its roster, and despite entering a market flooded with iAccessory after iAccessory, it has somehow managed to grab its own slice of an increasingly large niche. As with all good success stories, this particular outfit has plenty of twists, turns and run-ins with Lady Luck to tell about; for those interested in seeing how the "stay small" mantra is keeping Twelve South firmly focused on the future ahead, take a peek beyond the break.
I traveled down to the Lowcountry to have a peek into the daily lives of the folks that keep one of the smallest, albeit well-recognized-in-its-niche accessory makers, alive and kicking. For one, it's pretty interesting that a design-focused accessory maker not only threw down roots in South Carolina (instead of the conventional NYC / Chicago / LA / SF options), and two, the amount of focus this company exhibits is tremendous. Saying you're "Apple-exclusive" is one thing; saying "Mac-exclusive" is another. In fact, it was only recently that Twelve South issued its first iPhone accessory – the vintage-themed BookBook -- and it took an awful lot of convincing to get the green light from co-founder Andrew Green. But I'll get to that in a moment. %Gallery-155705%
Green launched the company with his wife Leigh Ann, and even today they share not only a home, but an office. Role models, anyone? At any rate, the two followed interesting paths leading to one of the biggest port cities in the American southeast. It (roughly) began as the two worked in New York (Mr. in marketing / publishing, Mrs. in fashion). After some years, Griffin (yeah, the iTrip Griffin) came calling, and soon after, Digital Lifestyle Outfitters (DLO) brought the couple to the area they still call home. According to Andrew, his years working on accessories for those two outfits gave him gobs of perspective, and it was soon after Philips swallowed up DLO that he fully realized the joy of staying small. Griffin was small. DLO was small. Philips was decidedly un-small.
He holds no ill-will towards corporations of any size, but he confesses that his own happiness has been elevated while working in companies where decisions can be made over lunch. Small-scale risks can be taken when the minimum order quantity isn't in the thousands. And, most importantly, he feels that the ability to adapt, innovate and create products that people don't even know they want yet prevails in small environments. Thus, it's no surprise that he works alongside just 11 other people, who just so happen to share his intense passion for creating beautiful, useful products for Mac loyalists.
Surviving a startup
Perhaps unsurprisingly, finding funding for a peripheral maker in 2009 wasn't easy. Impossible, depending on who you ask. That said, kids can't really do much to prevent the 'rents from tossing their college funds into a tech startup, and for all intents and purposes, that's what happened here. With a one-year runway and three prototypes in hand, a lot had to happen between then and now. And, as Green humbly admits, a lot of things just fell into place.
The couple just so happened to know a metalworker in Tennessee, and using some far-flung contraption, he was able to whip up the earliest look ever at the BookArc; to cover the harsh edges, they scoured a Lowe's home improvement store for pliable tubing. Mix in a pinch of DIY instincts, and they were looking at the doodad that would eventually win over buyers for Apple's own retail outlets.
His days with Griffin and DLO provided him access to a smattering of contacts at both Apple and with turnkey manufacturing facilities in mainland China. The call to Cupertino, however, wasn't returned with as much gusto as Green had hoped. After twiddling their thumbs, the founders finally landed the sales meeting they longed for and, amazingly, Apple Retail wanted a pair of Twelve South's products on store shelves -- including the aforesaid BookArc. %Gallery-155706%
"How soon?" I asked.
"Immediately," Green said. "We walked out there asking ourselves: 'Did that really just happen?'"
For those keeping count, that year-long financial runway was at least one-fourth over, and suddenly -- with no website, no physical presence, no Chinese language skills and no confirmed manufacturing partner -- these two had no choice but to truly, actually launch their company.
My eyebrows rose a bit, expressing a confusing wave of excitement, anxiety and concern as Andrew detailed the situation to me .
"Yeah," Andrew said. "Yeah..."
Within a week, the two had booked a trip to China and were meeting up with the only known contact they had in the Asian manufacturing circle. The facility was top-notch and would handle construction, packaging -- the works. The problem with that level of service is, of course, the price.
"We weren't anywhere close," said Green. "Suddenly, we found ourselves dropped like a hot potato by the only people we knew in China. We sat in our Shenzhen hotel room, staring at one another, thinking 'Oh, shit.'"
I interrupt his story to express my amazement at the situation, conveying the lack of poise I can only assume I'd exhibit in the same situation. But it seems that the old adage of "It's not what happens to you, it's how you react to it" applied here as well.
"I rummaged through any remaining contacts I could find on a WiFi hotspot down the street, and called a guy I had talked to a good while back," Green said. As it turns out, this Hail Mary led to a cab picking the Greens up from their hotel the following morning. Upon looking at the proposal, the two let out what I can only imagine were monumental sighs. "We finally had something to work with," uttered an obviously relieved Green.
The phrase "Stay small" is not plastered along the walls, nor is it tattooed across the foreheads of those within the company. But it is, however, amongst my favorite tunes from a little-known band by the name of The Receiving End Of Sirens. It's also an unofficial mantra of the Greens, and it's incontestably the most amazing part of my visit.
You see, there's a stark difference when looking at startups that had to raise capital from return-hungry angels, and one that's started with a trio of college funds. Instagram also had around a dozen employees in the early days of 2012; by April, it was purchased for a billion dollars by Facebook. Twelve South will never be purchased for a billion dollars. In fact -- if I had to bet -- Twelve South will never be purchased, period.
I've interacted with countless founders, co-founders and so-called co-founders over the years, and while the general spiel is usually the same, few genuinely stick close to the ethos that they started with. At the end of the day, it's about the almighty dollar, and there's obvious incentive to grow revenue in as many (legal) ways as possible, or possibly even seek a suitor or IPO. It's as if this is all a foreign concept at Twelve South.
Looping back to my earlier point about the iPhone-compatible BookBook, the Greens founded their company with one primary goal: to serve the intensely loyal and as Andrew Green puts it, "massively underserved" Mac market. "Everyone has a product that works with iPhone or iPod," Green stated, "but what about the Mac? Every time I'd walk into an Apple Store, I'd see heaps of 'Mac-compatible' accessories. Mac users don't want compatible. They want exclusive. There are tons of companies that serve the PC market -- and that's great -- but we saw very real potential to commit to the Mac market with our products." %Gallery-155704%
To date, the company offers but a handful of products. The BookBook family is the best-selling, according to Green, and has expanded from serving MacBooks to iPads and iPhones. For those unaware, it's a rigid case for each of the aforesaid products, but on the outside, it looks like a worn, well-loved book. Assuming it doesn't become huge, it also serves as a lovely anti-theft measure -- it's about as unassuming as they come, and while iBooks may entice thieves, standard books... don't.
The BookArc is perhaps its second-best product (in my humble opinion), enabling MacBook loyalists to use their products in a closed-lid scenario, while giving the laptop a cute, space-saving place to reside. In a nutshell, all of its products are solutions to problems that Green and co. had. "We don't do focus groups. We don't build products for the sake of design. We build solutions to problems that we run into during day-to-day Mac use."
The thing is, though, these products are really good. That's not Andrew telling me to say that. That's me canvasing Twelve South's product line and just being honest. For Mac, iPad and iPhone users willing to pay a premium for well-thought-out wares that aren't just built for the sake of satisfying shareholders' desire to keep something new on the shelf, these are just about as clever and classy as they get.
The conversation dovetails into me asking a number of prying questions. Things like: "Do you get a heads-up from Apple on design changes? Did you fully expect that serving the Apple community alone would be able to carry you? Have sales skyrocketed along with Apple's skyrocketing profits?"
The Greens did an admittedly fine job of dodging what they weren't allowed to speak about outside of NDA (that's a Non-Disclosure Agreement, for those who abhor legal acronyms) but I got the impression that Apple gives no one -- accessory makers, anyway -- a heads-up about incoming form factors. He recalled a period of time during his prior work where at least one major peripheral outfit gave the go-ahead to produce a new range of iAccessories based only on leaked design images. Turns out, they weren't even remotely close to accurate. "Obviously, we don't have the kind of scale here to try things like that. We take our time," he said.
The next question must have felt obvious: "Well, what if you had the opportunity to branch out... to make accessories for companies other than Apple?"
"We're not interested in that," he said. In fact, he has been approached by the non-Apple world; designers looking for a design house, companies with earnings in the billions and even one particular CEO of one particularly important consumer electronics company. Green remains humble, but I'm aghast.
"So you're saying there are companies that would take your products right now and adapt them for use elsewhere, but you won't do it?" I asked.
"We've thought about it, and we've had plenty of back-and-forth about it," Green said. "But it all comes back to one main decision: do we want to be a nimble, innovative company or a logistics company?"
Green's been in this business long enough to know the difference.
"I don't want to spend my days thinking about how to get so many shipping containers to so many companies," he added. "I want to think about creating new stuff. We could certainly create a spinoff company that maintains our DNA but creates for other companies, but then, we're diluting the very stuff we're making today." %Gallery-155703%
He tells me he's still working on plans to actually end-of-life a product -- something he really hasn't had to worry about just yet -- and it's obvious what a painful personal experience this is to him. It's as if each product is a child, and deciding when it's time to let 'em go is never an easy task.
I take one last walk around the office, still trying to wrap my head around the fact that Twelve South will almost certainly never be bigger than it is today. By choice. It just doesn't compute in a startup realm fueled by high-finance fantasies and absurd valuations. But, it seems to me that I've stumbled upon a duo that understands the pressures that come with expansion, and a duo that genuinely has no desire greater than being awesome at what they initially set out to do.
"So you're telling me you're choosing to stay small as a matter of personal fulfillment?" I asked.
This article originally appeared in Distro Issue 41.