Men’s short-shorts may seem like an unlikely product for an e-commerce startup.
But for Chubbies co-founders Kyle Hency, Rainer Castillo, Preston Rutherford, and Tom Montgomery, it was the most natural thing in the world to start a company based around retro-inspired shorts.
After graduating from Standford where they all met, the four guys pursued jobs in different fields ranging from traditional finance to the startup world to corporate retail.
Back in college, the four guys would wear retro short-shorts they found in thrift stories and had handed down from their dads and uncles. “If you had a really cool pair of shorts, people would talk about it,” Chubbies co-founder Tom Montgomery tells Business Insider.
So in 2011, a few years after graduating, they decided they’d had enough of their own jobs — they wanted to start their own company together, and they wanted to sell the short-shorts they loved wearing themselves. “We all had the mindset of wanting to run something ourselves and wanting to do something that was a little more meaningful and a little more fun,” Montgomery says. “It was such an extension of our personalities to start this company.”
It all started at a Fourth of July beach party
To test out the idea of mass-producing and selling men’s short-shorts, the cofounders made a few pairs of shorts and brought them to an annual Fourth of July celebration at Lake Tahoe. Along with 20 friends all clad in red, white, and blue, the cofounders hit the beaches at Lake Tahoe in their Chubbies.
“That was immediately where we saw how impactful the shorts were and also how polarising the shorts were,” Montgomery says. Reactions ranged from “‘Good lord, those shorts are the greatest things I’ve ever seen,’ to ‘Get off of my beach, men’s legs belong under layers of fabric,'” Montgomery says.
The cofounders immediately sold out of the few pairs of shorts they had brought with them right there on the beach.
“That’s where we really understood that the product was fantastic in terms of the resonance that it had,” Montgomery says. “The shorts struck the same emotional chord with other people that it struck with us. It reminded us of our dads, it reminded us of the weekend.”
When they got home from the beach, the founders built out a website and made a couple hundred more pairs of shorts. And in September 2011, Chubbies launched its website. From day one, the founders were inundated, selling out of their early merchandise immediately. “From day one we saw there was a very talkable, very shareable notion around our brand,” Montgomery says. “We saw complete strangers who we hadn’t told about the brand purchasing from us.”
Recruiting college fraternity brothers
Montgomery and his cofounders launched their company in September, just before winter. They started gearing up for March, which would be the company’s first big inflection point. To make sure they started spring and summer sales strong, the founders sent emails to fraternity presidents and the heads of other social groups on college campuses, letting them know about the shorts.
“Invariably, the guys who responded to us were the fraternity presidents and heads of these groups saying ‘Hey, I know a guy who’s interested, and it happens to be me,’ and immediately they were on board,” Montgomery says. Today, Chubbies has an ambassadors program, and has plucked more than a hundred college guys to help it continue to spread the word on college campuses. If you walk around any big college campus when it’s nice out, you’re bound to see at least a few guys rocking Chubbies shorts.
The founders spent all their cash to buy as many pairs of shorts as they could before the March push. “We thought it would last through the summer, and we sold out in a couple days,” Montgomery says.
So far, Chubbies has taken very little venture capital funding. In October 2012 Chubbies raised an undisclosed amount of cash from Rothenberg Ventures. Two years later, in April 2014, the company raised a $US4.4 million round from Thrillist CEO Ben Lerer, Rothenberg Ventures, Trunk Club’s Brian Spaly, IDG Ventures USA, and other investors.
Since then, Chubbies has had a steady growth curve, Montgomery says. As the years have gone on, the company has expanded from just their signature shorts. They have launched swim trunks and even a Hawaiian-style t-shirt called the Nutter. They’re also experimenting with producing long sleeve shirts and heavier-weight warmer items to let Chubbies customers wear shorts year round.
“We’re constantly building this brand around the weekend and the feeling you get around Friday at 5 pm,” Montgomery says. “When a guy throws them on, the stress and rigors of the work week can be put on hold for a bit.”
Rainer Castillo, who leads the merchandising, product design, and development teams for Chubbies, says Chubbies always wants to innovate on shorts, and one way the company does that is through riffs on nostalgic items. “When we were growing up, a big thing was tearaway basketball pants,” he says. “So we made a tearaway short that guys could rip away and there was a Speedo underneath. We take items of clothing that people are familiar with and turn them into shorts.”
Some of the company’s products also border on the absurd. For example, Castillo says the company is working on an entire outerwear collection, including items like a rain jacket short, a puffer short, and a sherpa short. “These items are outrageous, but our customer knows they’re going to find them nowhere else,” he says.
Chubbies also tries to innovate on the customer experience side of the company too. Kyle Hency, who heads up the business development and finance teams at Chubbies, says that one of Chubbies’ high school customers wrote to the company to let them know that he had his pair of Chubbies stolen from his locker at school by bullies. The Chubbies team, in return, sent him karate lessons. “We do a lot of those types of things to go above and beyond for our guys,” Hency said.
Chubbies’ American-made shorts come in a number of patterns: there are the company’s patriotic Americans shorts, as well as shorts in any number of patterns and colours. They cost between $US49.50 and $US59.50 a pair.
What’s next for Chubbies?
Chubbies has also dipped into brick-and-mortar, with a physical retail store on Union Street in San Francisco. Hency says the company’s been “pleasantly surprised and excited by the traction we’ve had in that store to date, and the other thing that’s really interesting is that us owning that ‘Friday at 5’ time period. We’re getting lots of people flying into the store from Thursday end of day through Friday who are going on trips over the weekend.”
In the casual shorts market, Chubbies faces tons of competition. Everyone from huge brick-and-mortar retailers like Gap and Abercrombie cater to the 18-to-35-year-old guys that Chubbies also hopes to sell to. But few other companies — aside from the preppy Martha’s Vineyard-inspired Vineyard Vines brand, and similar niche competitors — are going after the “Friday at 5 pm” mindshare like Chubbies.
Today, Chubbies has roughly 40 employees. Between its followings on social media and its mailing list, Chubbies’ community has grown to a “couple million people,” Montgomery says. In a couple weeks, Chubbies will have its annual “Fourth of Julyber Monday” — basically, a summertime version of Cyber Monday — and the company expects to do $US1 million in sales on that day alone.
“Last year on this same day, we got close, but didn’t break it, but this year, we think we’ll eclipse it,” Montgomery says.