Podcast 21: Bankruptcy to Profit in 10 Months: A Conversation with Karmaloop CEO Seth Haber

Nerd Marketing Ecommerce Podcast

Drew talks to Seth Haber about how they rescued streetwear retailer Karmaloop from bankruptcy in just 10 months. What went wrong, how they fixed it, and what they learned from it all. Subscribe: iTunes | Stitcher EXCLUSIVE RESOURCE: Want the transcribe from this episode? Click here to download it as a PDF. You may have heard about Drew's involvement in turning Karmaloop around – from bankruptcy to profit in just 10 months. But what strategies went into accomplishing this? What growth paradigm were they operating under? And how did Karmaloop get in that position in the first place? In this much-requested episode of the Nerd Marketing podcast, Drew talks to ex-Karmaloop CEO Seth Haber about that 10 month period of rapid growth. What they did, what they didn't expect, and what they learned from it all. Highlights Why Karmaloop went bankrupt before Drew and Seth came onboard How Seth ended up as CEO The things Seth didn't expect to be so difficult about turning Karmaloop around Kanye West's role in keeping Karmaloop afloat How Drew underestimated how difficult it was going to be to get the marketing platform up and running Winback campaigns – Getting back old customers vs. acquiring new ones Breaking into the footwear market What Seth is most proud of after his 10 months at Karmaloop The value of a company full of people that care about each other Links / Resources If you haven't already, listen to this episode on growth paradigms to better understand how Drew approaches eCommerce growth. To learn more about data-driven strategies that grow ecommerce businesses, just sign up for my mailing list. Transcript Prefer to read rather than listen to the podcast episode? No problem, you'll find a text transcribe below, and you can also download it for later. → Read the Transcript Drew Sanocki: Everybody, welcome to the Nerd Marketing Podcast. I'm here today with a guest who needs no introduction, Mr. Seth Haber, [crosstalk 00:00:15] former CEO of Karmaloop, the company where I was the CMO. Seth Haber: Thank you for having me. Drew Sanocki: How're you doing? Seth Haber: I'm good. I'll try not to talk over you for the rest of this thing here. Drew Sanocki: It's fine. It's fine. I'm used to that. Now we've got probably five or six listeners. Our listeners care about ecommerce. They're very curious about retail. Everybody wants to know the story of Karmaloop. How did they go bankrupt? How did we grow them out of bankrupty and then the process we went through when we sold the business. Seth Haber: Cool. Drew Sanocki: I could think of no better guest than you. Seth Haber: I appreciate that. Drew Sanocki: Probably because I don't know what I can and can't talk about and I'm just going to follow your lead on that. Seth Haber: Oh, man. Here's hoping I get that right. I think, for me, it's important to say that neither of us were involved in the business before it went bankrupt. My involvement started really very, very shortly before I took over on, I think it was May 27th, so really maybe a couple of weeks' head start to that. A million stories going around but I think the one thing that was really clear, after having been involved for a little while, was that Karmaloop was a fast-growing, exciting business. They took a significant amount of money from venture capital guys or private equity guys, whatever you want to call them, and they were asked to and went for broke, went for gold, and tried to build a massive company. Along the way, it didn't work. Why it didn't work, I wasn't there so I can't tell you. Everyone's got a lot of theories but the truth of the matter is it didn't work and that led them to going bankrupt. Drew Sanocki: I want to say they got up to $100 million in revenue at some point or close to it. Seth Haber: Yeah. I think one of the most ... probably over it, but I think one of the questions we'd certainly have to ask or find ...