A Pandemic, Heatwaves, Supply Shortages and a 20K Waitlist. Our First Year In Business As a Cooling Brand.
A year ago to date, I launched July, a new brand with a fresh take on air conditioning. The response to our first product, a re-imagined window air conditioner, has been humbling. But starting a business with high demand in the midst of a pandemic has brought with it tough challenges, high-pressure moments, and critical lessons. Here are some of the lessons I’ve learnt on July’s journey to date.
Hi there, I’m Muhammad, founder of July. This month, our company is celebrating its first anniversary (yes, that is where the name comes from), and I am immensely grateful that the reception we’ve received from our customers has given us the conviction to power ahead into Year 2 and beyond. As it is with the birthday of an actual human, the anniversary of a company’s founding is an opportunity to reflect on what has occurred to date, and what lies ahead. And that is what this Medium post intends to do. I write it partly to provide some insight for those who are interested into the early days of starting a hardware business in the middle of a earth-shaking pandemic, and partly as a way to memorialize this scary-but-exciting, grueling-but-elating moment in our young company’s trajectory. Enjoy! (And stay cool.)
First, a little background
In case you don’t know too much about July, here’s some context on who we are and the big dreams we aspire to.
In summer 2020, we launched our first product, a window air conditioner, designed to address the main frustrations that customers have had with window A/Cs for decades. We re-designed the window A/C from an aesthetic perspective, transforming it from an appliance into a home decor object that could also be customized to fit into your unique style. In addition to design, we’ve invented a revolutionary, patent-pending installation system that makes July safer, easier, and quicker to install than anything else on the market.
Now, we’re entering Year 2 with a growing community of customers, product enhancements underway, and a 20,000 person waitlist. Not every customer’s experience has been smooth, and our to-do list is longer than a CVS receipt. But most importantly for me, we are learning every day, and at an unprecedented and uncertain time in the world. As I reflect on Year 1, I come away with 3 major lessons. Hopefully, these can be helpful to others who are early on their entrepreneurial journey — or pondering taking that plunge.
1. When the unexpected happens, lean into transparency.
At any point in a company’s journey, but particularly in the foundational period, things will go wrong. Unforeseen circumstances will arise, mistakes will be made. It won’t all go smoothly. You can put on your consulting hat to game out all the possible scenarios, only to find that one of the (infinite) scenarios you didn’t plan for, comes to pass.
When we got started on July, we rightly had ambitious goals. Using a rapid product development approach more commonly found in the software industry, we aimed to bring a brand new product to market in less than 12 months. Legacy brands usually take 2–3 years to develop and launch any new product, but we didn’t want to lose valuable time in which we could be honing our product-market fit. Things were on track for a mid-summer 2020 launch. And then: the pandemic hit.
While the world seems to be inching towards normalcy for many of us in the U.S., it can be hard to understand that the manufacturing and supply chain ecosystem is anything but. Freight costs are up 4x what they were in 2019; lead times for sourcing key components for appliances can be a shocking number of months; workers are simply not able to go back to the factory in many of the countries involved in production. The overall system still isn’t stable.
Because of these issues, we experienced delays in our units arriving into the U.S. in both 2020 and 2021. Compounding this issue further, any new arrival date was untrustworthy — with so many moving parts in the supply chain, each forecasted date shifted again and again, and a final arrival date wasn’t so easy to ascertain. So, the question became: how to communicate with customers, without being able to tell them an exact date?
Our instinct, perhaps informed by the corporate world, was to wait until we had a firm date, and communicate with customers when we had the answer. And we were wrong. Instead, we learnt that the modern customer appreciates honest, open transparency. Our customers understand that we are a young brand; they have been flexible, patient beyond measure, and expressed that they want to support a team like ours trying to take on the status quo. In fact, what should set us apart from the megalithic corporate companies that we’re so ready to disrupt is precisely that benefit of human connection and transparency in understanding where the product comes from, when it’s coming, and everything else that a service-centric brand can demystify.
It can be tempting to try and portray a larger, more complex company when you’re starting out. After all, who trusts a scrappy team of thirty-somethings? But, customers are savvy, and they know you aren’t in the Fortune 500. Don’t be afraid to give customers a look under the hood. Many of them will support efforts to bring something new and exciting into the world; and nobody expects a small company to have it figured out like the big guys. Be transparent, and your customers will thank you for it.
2. If you’re doing things right, you’ll have a supply problem.
A lot of entrepreneurs (myself included) work themselves up about demand for their product before launch. “Are people going to want it? Is it going to sell?” Even if you’re confident in what you’ve built and the process of testing that you deployed to build it, it’s hard to shake that nagging feeling.
The truth is, if you achieve product-market fit, chances are your supply in the early days will not be enough to meet the natural demand for the product. This is something that we experienced pretty acutely.
Over the past two summers in market, we’ve had a limited amount of product. Meanwhile, as a strategy-minded team, we had already drafted out all the different ways we could market July — through partnerships, paid ads, activations, and other innovative ways of telling people about our A/Cs. Then, we sold out both years during the first few weeks of our pre-order phase. What started as a marketing plan instead became an anxious struggle to manage inbound stock requests, collect emails to form a waitlist, and deal with the ironic pain of having to turn sales off. With customer excitement — and an undoubted boost resulting from heatwaves across the country — we’ve had interest that far surpasses our ability to produce.
Instead of stressing out, or regretting our smaller numbers from the past year, I’ve learnt to take the leading indicators as the lesson. If we can always be one step ahead on demand, and focus on ways to delight customers, we’ll be doing things right. For 2022, we’re laser-focused on ramping up production so that we don’t sell out before summer again. At the same time, we’ve learnt that another success metric may lie in how much customer interest and feedback there is from the market, that can propel our business further even without sales.
3. Always be close to the action.
Before July was conceived, I bought a container-load of Frigidaire units, set up a website, and sold, delivered, and installed almost $50,000 worth of window A/Cs to customers in New York City. After working directly with customers, installing hundreds of A/Cs, and learning a whole new vocabulary of hardware terminology, I thought I might finally have earned a background ready to create an A/C brand. I got to understand the industry and the product not from reading reports or speaking to experts (although I did that too) — but from getting out there, using the product and interacting with customers.
I’ve always believed that the leadership of a startup benefits from the operational, hands-on experience they develop out of necessity in the early days, when everyone is wearing multiple hats. This helps the team develop a deep, intuitive understanding of all aspects of the business in a way that delegation would never reveal. Yet, this was an attitude I didn’t truly understand the value in until this spring as we launched in larger operations.
To date, I personally have conducted about 25% of our installations myself. This allows me to hear what customers are looking for when they are getting an installation; understand the logistical problems that might arise from a day-full of installs; and get to know all the quirks of New York City’s buildings and windows. We’re now putting these learnings into our processes so that we can have an even higher rate of delightful, on-time installations next year.
We live this philosophy across the team too. Emily, our Head of Brand, personally called every customer who had experienced a delay or quality issue with their July delivery. This allowed her to hear first-hand what had gone wrong, and also showed them our commitment to making things right by being close to the action. Emily’s learnings come up in every conversation we have, from what we might want to improve in the product for next year, to ways we can improve our website to make it easier to navigate.
This is the July approach, no matter how large our company grows. If we have a team where everyone is an expert on the ground, and truly empathizes with the customer experience, we’ll build unstoppable intuition into how to make the July A/C the best for our customers.
Don’t expect perfection. But strive towards it.
Looking at the history of window A/Cs over the past 60-odd years, one thing is striking: how little they have changed. And that’s why we exist: we are on a mission to reinvent your relationship with your home appliances, and bring warmth, design, and personality into some of your the coldest products in the home.
In our short journey to date, we’ve made mistakes — but we’ve also built a product that’s got people excited in the A/C space, for the first time in a long, long while. I can’t promise we won’t make mistakes in the future. But I can promise that, as a brand, we will keep listening to our customers — to hear the good, but especially the bad — and to implement what we hear and turn it into changes for operations, customer service, and the product itself. We promise to keep pushing the envelope on how to enhance your feeling of home, no matter if you’re in Orange County, outside Omaha, or up in a high-rise on Park Avenue.
So, to all our customers who’ve taken the time to send us feedback: thank you for helping us build the next generation of July. We can’t wait to have you on this journey. For those of you who need an upgrade for your window, head over to July and get on our list for summer 2022 ;)
