[ad_1]
Quentin Hill teed up his first startup, Convenient Clubs, when he was still a junior in high school and had just $112 to his name. The goal was to jack up his bank balance so he could upgrade the Christmas gifts he gave to his parents and sisters.
He noticed his teammates on his high school golf team were all hitting growth spurts but as they added inches, many couldn’t afford to get fitted with new equipment.
“The sticker price on golf clubs was increasing 10% a year which is very steep for the average 15-year-old. The goal was to allow them to build the clubs that would be best for them and their game but at an affordable price point,” Hill explained.
He began buying up gently used sets of clubs that would often be languishing in the corner of people’s garages and stored them in a warehouse. He then spruced up the sets working with a local vendor to sandblast off the old finish, add colors and stamp them with initials and other custom touches. While it was slow going at first, by his senior year, the business was pulling in $50,000 a year in profit.
Golf also would provide the springboard for his subsequent business Hidden Gems Sportswear. After caddying for his friend Hailey Borja at the 2020 U.S. Women’s Amateur, her mother, a Production & Development Manager for Mitchell & Ness, offered to take him to the company store as a thank you. Her daughter finished T8 in stroke play and advanced as far as the round of 32 in match play before falling to Teresa Toscano Borrero.
While browsing the store he couldn’t help but note that the throwback jersey specialist, that would later be acquired by Fanatics, had boxes of excess product lined up against a wall. He got the idea to buy the the inventory off their books and resell it through third party vendors to provide fans of the brand a chance to purchase overstock product at a discount to retail prices.
When it came time to choose a college, Hill gave both his professional golf and business dreams equal consideration. Hill enrolled in San Diego State University striving to follow in the cleat marks of alums like Xander Schauffele, J.J. Spaun and Scott Piercy who went on to careers on the PGA Tour. A spot on the Aztec Men’s team was definitely a draw, but so was knowing that the school he would be attending produced major business luminaries including Costco co-founder Jim Sinegal, Jack In the Box founder Robert O Peterson, and Rockstar energy drinks founder Russell Weiner.
In his Junior year of B-School, while most students are learning theory and merely analyzing case studies, Quentin Hill decided to actually get down to business and purchase Iliac Golf for $500,000.
Hill was first introduced to Iliac, a high-end golf apparel and leather goods brand, after a random run in with the company’s founder during a Carlsbad City Amateur during the offseason. He had complimented his sense of style and the pair hit it off with Hill eventually modeling for the brand in exchange for free product.
Capital Raise
Hill had saved up $127,500 from his prior business endeavors but wasn’t quite sure how to raise the remainder of the capital. After class he approached his SDSU finance professor Stephen Brincks and asked, “if I want a five-dollar glass of water, how do I buy it with one dollar?”
After getting schooled on debt-to-equity ratios, Hill brought aboard four investors—including Brinks who ended up buying 12% of the company. They raised a quarter million in long term debt, issued the same amount in stock. Hill is the majority shareholder with a 51% stake in the company and had just $412 left in his bank account after acquiring the entity.
At the height of the company’s fortunes, from 2005 to 2015, Jimmy Walker and Zach Johnson were sponsored by them, 81 tour players wore and used their products and top line revenue was $3 million.
“They were roughly on the same trajectory as TravisMatthew who went on to do $120 million and get sold to Callaway,” Hill said.
But by the time the brand changed hands, Iliac was a mere shadow of its former glory. Former owner Bert LaMarr was dealing with challenges in his personal life and the brand had hit a major downslope, netting just $246,000 in sales in its final year pre-Hill takeover and also fell off the ball as far as delivery reliability goes, leaving 650 unfulfilled orders on the books.
“As much as I loved the product, in my mind it was also a recovery play. The thought was this product quality is so good. The top players in the world have access to anything and they’re choosing to use this brand’s product,” Hill said.
To affect a turnaround, Hill set out to pair the product quality with great customer service and fulfillment times. The first order of business gave $140,000 worth of store credit to customers who had been left in the lurch.
Next, operations were streamlined by bringing production completely in-house and under one roof with the purchase of a factory in San Marcos. “Every morning to come in here at 7 a.m. and have our sewers making our product is incredible. Last week we took all 36 leathers and put them into a patchwork headcover and while that’s not a scalable part of the business, I feel the flexibility we have here is unbelievable,” Hill said.
While the vast majority of their competitors mass produce their products overseas, ship them stateside and then run ads promoting inventory to consumers, Iliac has chosen a different model. They hold the raw materials in stock but not the finished product and also every single product in Iliac’s line has the same profit margin.
“We don’t have any bias toward any individual product, we just want what is best for the customer. We’re never in a place where we are forcing a customer to buy something because it’s in our best interest and I think that is something that is really special about Iliac,” Hill said.
This was born out of Hill’s takeaway from a short stint working in a custom golf shop where Pure Grips were pushed on customers during fittings because the margins were higher on them than any other grip brands they carried.
“It really bothered me that they said they were there for their customer and really they weren’t,” Hill said.
Half of Iliac’s business is in Japan, South Korea and Europe and they recently entered the Chinese market. While the brand is no longer as ubiquitous as it once was on the top tours, eagle eyes may notice that their alignment stick cover is still in Hideki Matsuyama and Abraham Ancer’s bags. Hill is also taking educated bets on the future tour talent, fully outfitting his former teammates Newport Laparojit and Puwit Anupansuebsai and providing them with leather goods, a move that may also create interest in the brand in Thailand.
In 2022, during Iliac’s inaugural year with Hill running the show, sales surged by more than 50% to reach $372,000 and are poised to reach $550,000 by year-end. Hill’s projections indicate revenues of $750,000 to $1,000,000 for 2024 as the brand continues to land wholesale accounts like Bluejack National, Royal Liverpool and High Pointe Golf Club while simultaneously bolstering their D2C business.
Follow me on Twitter.
[ad_2]
Source link