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CleverMade Came on Scene Ready With Products, Production

KitchenAid, Rubbermaid and now CleverMade. A Carlsbad company is coming into the saturated storage industry with collapsible, space-saving options for crates and baskets that are mobile, a solution for anyone on the move, camping or packing for college.

After standing in a Home Depot in

Encinitas surveying an assortment of crates and feeling overwhelmed, the founders realized they had an opportunity. It started with, ‘Wow, what a clever idea.’

“We think there’s applications once people understand that you can do this (replace corrugated boxes or bags at checkout counters) with a storage crate that opens up a whole new category called ‘Active Storage,’ and it really is transporting things from A to B,” said Tom Quinn, co-founder and CEO of CleverMade. “We see the same thing happening with the fabric baskets. Instead of a bunch of crumpled up bags, now you have something that’s really neat and tidy that you can use to move things around.”

With over $7.5 million in revenue in 2015, CleverMade sells hundreds of thousands of units in a number of large retailers, including Costco, Sam’s Club, Target, Home Depot, Bed Bath & Beyond, QVC and Amazon. In 2014, the company made over $1 million. It prepared before going to market by choosing partners whom it could trust to meet the volume it was aiming for.

Delivering the Goods

“When you’re in Costco and Costco is looking at us like, ‘You guys are a 6-month-old business, if we test this product, we’re going to buy hundreds of thousands of these units. Can you make them?’” Quinn said. “The ability to talk with conviction and to convince them, if you will, really doesn’t come from showing them financial tables or factory pictures. It comes from them believing in you, that they can tell by what you’re telling them, and how you’re going about it, that you’re going to be able to handle it.”

This year, Quinn said he expects the company to make north of $10 million. Since its founding, the company has had a couple investors in its only funding round, a pre-revenue capital raise, which brought in approximately $1.5 million for a small minority position in the company. Quinn provided an initial investment into CleverMade but the company has otherwise funded itself through its sales.

New Product Pipeline

“The company, in order to continue with accelerated growth, will accelerate growth on the backs of new product line introductions,” said Quinn, 54. “We’d expect to do between six to eight new product introductions per year over the next few years.”

Quinn and Mike Carlson, co-founder and president of CleverMade, met at their prior place of employment, SKLZ, a sporting goods and training equipment company also located in Carlsbad. The idea for their product came after trips to Europe where the collapsible product market is much more expansive.

“It wasn’t until we saw how big the category was over in Europe, really doing some of those retail store visits and (seeing) how much space the retailers over there were dedicating to the category that it really pointed out that this was not a category to ignore,” said Carlson, 35. “Seeing something that gets so much attention overseas and then finding out that 19 out of 20 Americans have not even heard of a folding crate, led us to believe that there was really something here.”

CleverMade’s first product, plastic containers that easily collapse and fold flat, is called CleverCrate. The founders plan to release a new line of crates with a new aesthetic design and additional functions. The company will roll out changes in 2017. Some of these include adding lids to crates, having two stackable crates on a trolley, and creating a crate with legs to use as a table.

The company’s second product, SnapBasket, is meant to replace reusable or single-use grocery tote bags with a rigid, structurally sound, one-pound shopping basket that can also fold flat. Variations of the product include various design and size options, insulated basket options, an insulated, waterproof option and a bigger basket that can be used as a laundry hamper/caddy.

The company has more products in the pipeline such as the CleverMade WorkStation, a cabinet that would fold out to create a workstation for gift wrapping, crafts or for the kitchen. Their current products range from $7.99 to $29.99.

CleverMade is manufactured overseas in Europe and Asia and then shipped to third-party distribution/logistics warehouse centers in Ashland, Virginia and Ontario, Calif.

CleverMade gets input from what it calls its board of directors, Vistage, a locally based executive coaching organization that sets up monthly executive meetings among experienced industry leaders.

CLEVERMADE

CEO: Tom Quinn

Revenue: $7.5 million (2015)

No. of local employees: 7-8

Investors: Private investments of about $1.5 million

Headquarters: Carlsbad

Year founded: 2013

Company description: Creates products focused on providing space-saving, innovative solutions across the market

Key factors for success: Awareness of how the product fits in the market, relationships the leaders have fostered over the years

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