Fireside Chat With San Diego's Joe Kudla, Founder of Vuori Clothing
Joe Kudla shares insights on building a fast-growing apparel startup and what to expect from the global activewear brand going into 2024.
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On Aug 16, around 400 of San Diego’s most influential leaders and community members across life science, government, sports, real estate, and technology convened on a summer evening in La Jolla, California.
The annual event called, “Summer Bash” was hosted by San Diego Regional EDC in conjunction with Alexandria Real Estate Equities, featuring San Diego-based Kombucha startup Nova Kombucha and Vuori Clothing.
The programming celebrated San Diego’s innovation scene and showcased Vuori’s commitment to create thousands of jobs locally and nationally.
Please enjoy key insights shared from the event.
Brief Introduction
“The legend himself, Joe Kudla, big round of applause please,” said Daniel Ryan, Co-Chief Investment Officer at Alexandria Real Estate Equities, whose firm boast luminary tenants such as Illumina, Bristol Myers Squibb, and others.
Greeting the assembled crowd, Daniel Ryan paid homage to the 45-year-old founder.
Vuori, a long-time tenant with Alexandria, Ryan broke the news that they are helping remodel its San Diego headquarters this year.
After exchanging a few words, he handed the mic over to Kudla, who kicked off the conversation by asking the audience an interesting question:
“By a show of hands — who in the crowd has ever bought a pair of clothing from Vuori?” Nearly all 400 attendees enthusiastically raised their hands. “That's what I'm talking about! I love you, San Diego,” said Kudla smiling, and passed the microphone back to Ryan to begin the fireside chat.
NOTE: Transcript have been edited for length and clarity.
On the journey to start Vuori:
“Vuori is my third apparel brand and forth business. I started my career in accounting, out of all things. Before Vuori, I operated a local staffing company with a couple partners.”
“It's been a journey to get to this point, it was not an overnight success. I took a lot of learnings from those other companies. The biggest difference from the apparel brand one and two was that it was a side hustle for me. It was always a passion of mine and I had a vision for what we could create. I didn't know how to do it at first. I'm still learning to this day.”
[Joe Kudla left his job at staffing firm, Vaco in 2013 to launch Vuori in Encinitas focused on high-quality activewear.]
On filling a void in the apparel business:
“Vuori is a performance apparel brand. Unlike our competitors who draw inspiration from sports, urban street culture, or basketball. We draw inspiration from the way that everyone in this city (San Diego), lives their every day lives. That aspirational coastal southern California lifestyle. ”
“Early on, we felt there was a culture gap in the activewear space. I remember some of my friends would wear board shorts to the gym. While those might be great for surfing, they’re not the best shorts for working out, but people still did it because it’s southern California.”
“Vuori was really built for coastal North County San Diego. That was really the source of inspiration. It was so obvious that there was a void in the marketplace. And so I jumped in with two feet and pursued it.”
On hardest moments during the early days:
“It was a tough first couple of years for Vuori. I was pounding the pavement looking a for capital, given that as theses types of business consume a lot of capital.”
“I went to New York the first time, when we got samples to meet with the head buyer at Equinox. It was very intimidating. I went into the conference room and pulled out seven pieces of clothing to put on a rack … they said: “This is interesting, but it kind of looks like swimwear.”
The crowd laughed.
“They told me this isn’t going work as active wear. You might want to maybe think about launching something like a surf brand or something along those lines instead.”
“Early on, everybody wanted to put us in a box. We were trying to break down those silos and those boundaries. And that was beauty of what we were trying to create. It wasn't an easy start.”
[Today, Vuori is now the number one activewear brand sold across both men's and women's at Equinox nationally, according to Kudla]
On biggest inflection points that drove success:
“One of the biggest inflection points on this entire journey were the first two people that joined me to launch Vuori.”
“They were two wildly talented, successful people from the industry that chose to join me on this journey. I attribute so much of our success to the people that I've been surrounded by. I could never have done any of this without them.”
[Vuori’s first two hires were Sarah Carlson, Head of Design and Nikki Sakelliou, Head of Marketing.]
On nearly running out of money in the early days:
“I looked at our bank account and realized we were running out of money. We had maybe a couple months of capital left, and hadn't really proved our model yet to investors to go out and raise more capital. I thought it was the end of days.”
“We made the decision to pivot and focus all of our energy to go direct-to-consumer instead of chasing more wholesale accounts. At a time is wasn’t an obvious path forward back in 2014. It was still the early early days of social media advertising and working with influencers. All things that we know to be common-place in marketing today.”“We took all the money that we had left and bet it on a direct-to-consumer strategy, which turned out to be the best decision we ever made. And we were well on our to success from then on.”
[By the end of 2017, Vuori was profitable]
On competition with Lululemon:
“A lot of people perceive us to be kind of the birth-child between Lululemon and Patagonia. I think that's fantastic, because we are amongst great company. But at the same time we are the first Vuori.”
“We believe we are creating our own space and have brought versatility and comfort to the market in a way that hadn't existed before. It’s something we're tremendously proud of.”
“I have so much respect for Patagonia, specifically around the way they build their business. The do such a good job of staying true to their north star, even when it means, sacrificing revenue or growth. We want to be a brand that is steeped in a deep value system. We take a lot of lessons from them in that regard.”
“I also have tremendous amount of respect for Lululemon. They created our category — that's the truth. Today, we are building our own version in the space, but without them I don't know if any of this would be possible.”
On the what’s in store for Vuori in 2024:
“We are in a very heavy investment phase of the business. We have over 2000 employees today, with over 500 in San Diego. We'll hire north of 200 people at our corporate headquarters this year and another 200 next year.
“Becoming that multi-billion dollar global enterprise, looks a lot different than it did a year ago. A year from today, it's gonna look a lot different than today. We are in a constant state of change, in order to keep up with the pace with the demand that we’re seeing in the marketplace.”
[Vuori plans to open 50 retail stores nationwide by the end of 2023, and creating hundreds of jobs here in San Diego]
Thank you Bree Burris, Director of Marketing and Communications at San Diego Regional EDC, who allowed me to get the inside scoop on Vuori and the extraordinary founder behind it (as this event normally would be billed off-the-record).