009: LoveSac - Life on a Couch with Shawn Nelson

Shawn Nelson, founder of LoveSac shares his uncanny story of turning a simple idea, practically on a whim, into a international company that is set to change the way most people think about family and TV room furniture alltogether. Shawn shares how he invented the very first LoveSac in 1995 by seeking to build the world's largest bean bag chair out of his living room.

In discovering that filling up a massive fabric, self-made "bean bag cover" with beads was going to take him a long time coupled with a lot of trips to the store on a limited teenage budget, he instead began chopping up old foam sleeping bag mattresses to fill the space.  Upon completion, a surprisingly comfortable discovery was made.

Learn how Shawn turned his discovery into a national retail business frought with twists and turns along the way. Shawn also shares his experience in 2005 in winning Richard's Branson's "The Rebel Billionaire" as well as what he learned while working so closely with Richard while briefly serving as President of  Virgin World Wide

Lastly, Shawn gives insight to entrepreneurs that is often not talked about, but is much needed to hear. Learn how Shawn transitioned his company to launch a new line of products called Sactionals that will change the face of how you think about furniture. 

CONNECT WITH SHAWN

Website: LoveSac.com

Shawn's Blog: Life On A Couch

Twitter: @theshawnnelson or @lovesac


VIDEOS MENTIONED IN PODCAST


See Shawn's full story of launching LoveSac:

See a quick intro on configuring LoveSac's Sactionals


SELECT INTERVIEW HIGHLIGHTS


What were some of Lovesac's earlier challenges? {Note: this question is paraphrased from shawn talking about the state of his company in 2004 around the time that he competed on fox's "The Rebel Billionaire" and was asked to risk his $1M by RicharD}

LoveSac had a lot of challenges. We had grown very quickly. We were very inexperienced in terms of managing a supply chain and product development and importing out of China... There were a lot of people who were my business partners and employees that were definitely underpaid for their jobs and we had had some very close weeks financially where people had given up paychecks to help the company work and it was very tough for me....
I think that there's lots of stories of people who got lucky or just really had outside success very quickly and LoveSac has had moments of that but I'll tell you what:  like 20 years now since I've made the first Sac in my parent's basement it is a saga and it has been a slog and along the way there have been lots and lots of people who've given up bigger salaries or different opportunities to try and help make this work and that's what I know. There may be an easier way or a shorter path but I think that you don't build a business alone, particularly not one like this, and you've gotta have great friends and loyal people to make it happen and I've been blessed with that along the way in many different cases. 

what was one of your biggest take aways in working directly with richard branson?

So what's funny is two things: I didn't get to see Richard as much after I won the show as I did when I was on the show and I realized how rare an opportunity it was to spend two months traveling the world with Richard Branson.
I didn't appreciate that at the time because I was in just in the throws of trying to compete on a TV show. I realized quickly after I was made President as I flew around the world and worked with his CEO's directly of his various company's from Virgin Trains to Virgin Planes to Virgin Money to whatever; these guys rarely saw Richard if they saw him at all. Richard is a Billionaire, his time is not his own. Between charity events and company obligations he's a pretty busy guy with a lot of responsibility. 
I realized "WOW" what a strange thing it was to have so much face time with him as we shot this TV show. The biggest takeaway that I had from watching his people operate and his company's operate as I consulted with them, in my little role there, was these mega-billion dollar corporations are totally screwed up. I don't mean Virgin per se, I mean like all of them.
I realized that it's so easy as an entrepreneur to put on a slick show, you go give a good presentation, you have your money raising decks, and you pitch your business as if it were this amazing opportunity. But, really deep down you know that you are being sued over here and these people want to attack you over here and your financials are totally messed up and your supply chain has some major gaps in it and you know you never present that. You wonder "Oh my Gosh, this is such a mess how does anyone survive?" 
But then you go to these companies that are absolutely massive, have all the money in the world and all of talent and expertise and you realize its not so different there. It's just bigger and they are totally screwed up politically and otherwise. It actually made me feel really good because I realized that underneath it all, that's business. Underneath the slick ads and exterior that you see, are totally twisted, screwed up situations that somehow just keep plodding forward and hopefully making money. Once you realize that its easier to relax and just kind of be okay with your own shortcomings or flaws. 

What has been one of your biggest challenges in being an entrepreneur that perhaps you didn't expect?

In hindsight now, it is impossible for young people in particular to know stuff that they haven't yet learned. It sounds like an obvious thing to say but one of the strengths of many entrepreneurs is their confidence, their ability to take risks and be confident in themselves and step out. But the kind of dark side of that coin as I've learned it, observing my own experience - success and failures - is that with confidence comes sometimes the resistance to help from the outside.... In hindsight had I sought out proactively, humbly, more advice from smart people, experienced people when I was younger I could have avoided millions and millions of dollars wasted. I could've avoided years of time spent learning things the hard way and millions frankly of other people's money trying to do things my own way. 
Its very challenging to be an entrepreneur because you can't be so humble that you don't believe in yourself, but if you're too brash you don't accept help when it presents itself because you're so confident. Its unfortunate because a lot of business to be honest with you, is formulaic. A lot of business is best practices like there are just ways to do things that are really good and people have already figured it out. 
If you really are intelligent and you really are some kind of genius or you really are some kind of out-sized talents as an entrepreneur; shouldn't you be spending your talent developing things and processes and concepts and products that are totally new versus trying to do very basic business stuff in a new way? 

What advice would you give to struggling entrepreneurs now?

I think the answer always lies in two places. One is always: read, read read! There is too much written on every subject inside of business to even cover in your lifetime. There really are a lot of answers out there that are already in print and you can find them and learn from them.
Number two is: network, network, network! This is something that some people just do naturally because that's how they're wired; I never was a big networker. I don't work the room, I don't go out there and try and get from one person to the next connections...but I've forced myself to be like that a little bit or forced myself into associations or even events where I can do that because I've realized that there is so much to be learned from others.
So I think its really important for entrepreneurs to force themselves to read and force themselves to learn from other people and to grow their network of other people because most of the answers you need can be found out there including ones that aren't apparent like when you need to pivot or when you need to totally change your maybe your business model because it's typically going to come from a conversation with some other really smart person that you're having lunch with...and a lightbulb will go off and then you'll make good decisions and you'll pivot your business to get it to the next level and you would have never gotten there by sitting around thinking really hard. 

SHAWN'S RECOMMENDED BUSINESS BOOKS


Here is the Book List from Shawn's Blog:

10. Steve Jobs, by Walter Isaacson

9.   Benjamin Franklin, by Walter Isaacson

8.   How to Win Friends and Influence People, by Dale Carnegie

7.   Influence, by Robert B. Cialdini

6.   Switch: How to Change Things When Change is Hard, by Chip Heath and Dan Heath

5.   Good Strategy, Bad Strategy, by Richard P. Rumelt

4.   22 Immutable Laws of Branding, by Al Ries

3.   Purple Cow, by Seth Godin

2.   The Advantage, by Patrick Lencioni

1.   Good to Great, by Jim Collins

Also mentioned in the podcast:

Psycho-Cybernetics by Maxwell Maltz


EXTRAS


Richard Branson's, The Rebel Billionaire

Watch highlights from Richard Branson's, The Rebel Billionaire which aired on Fox in late 2004 through early 2005. In this highlight reel, a brief review of show moments are seen along with the final moment in which Shawn win's $1,000,000 and is given the opportunity to briefly serve as President of a then-new Virgin WorldWide venture: 

If you'd like to watch the full season finale, click here . 

Chelsie Hightower's performance on Sactionals

Watch a video of Chelsie Hightower, an Emmy nominated professional dancer, choreographer and seven-time Dancing with the Stars star and her team of dancers perform a dance with LoveSac Sactionals at Dwell On Design in Los Angeles: