Nick Stobie of Teema Towels: 5 Things I Wish Someone Told Me Before I Became CEO

Nobody is more likely to buy your products than a person who is already a happy customer. They do not need to be sold on your product, they already have it and like it, they just need to be reminded about it from time to time. And guess what? Advertising to a person who has already bought your products and given you their email is… free! That’s right, the best traffic source you can possibly market to is the only one you can market to for free. And this traffic source grows with you, it gets bigger and more effective every day.

DO NOT forget about your existing customer base. Give them the attention they deserve, respond to inquiries quickly, offer easy returns and exchanges, run multiples sales each year, send them emails a few times a month. While some of these things may cost you money in the short term, they will pay off handsomely in the long run. Happy customers spread the word about your business. A potential customer referred to your site by a friend is statistically much more likely to convert than a potential customer who clicked your Facebook ad. This is the whole point of building a brand, the goal is to get to a point where you have so many happy customers that they handle a lot of the marketing for you.

As part of my series about the leadership lessons of accomplished business leaders, I had the pleasure of interviewing Nick Stobie.

Nick is a 26-year-old entrepreneur and software engineer from Los Angeles and is the founder and CEO of Teema Towels, one of the largest Turkish towel and blanket brands in the US. At Teema Towels, Nick manages everything from advertising to customer service to product sourcing.

Nick’s entrepreneurial spirit was fostered at 13 years old after he worked his first commission-based job hauling a cart along a parade route selling trinkets. Since then, he’s worked as a baker, a server, a real estate agent, a software engineer, and now, as the owner of a successful online brand. Nick is a big believer in forging your own path, which has spurred him to take many risks in his life, like dropping out of college and starting a business selling towels even though everyone he knew asked, “why towels?” Thus far, those risks have worked out pretty well for him.

Thank you so much for joining us! Can you tell us a story about what brought you to this specific career path?

Prior to founding Teema, I was working as a software engineer at an ad tech company in Los Angeles. After about a year there, the company started to struggle and eventually our entire office was laid off. While getting laid off doesn’t sound great, I was pretty excited. For the first time in my life, I had some meager savings as well as free time, so I decided rather than find another job (sorry mom and dad) to do two things I’d always wanted to do, travel abroad and eventually, start a company.

I bought a one-way ticket to Thailand expecting to stay a month and ended up staying 6 months and traveling to 8 other countries. I brought with me a microfiber “travel towel” that I had purchased on Amazon prior to the trip, which I ended up hating. As it turns out, microfiber is a pretty terrible material to dry off with. About halfway through my trip while in a Cambodian night market, I passed by a vendor selling Turkish towels, which caught my eye as I had never seen them before. They were way nicer than my microfiber towel and just as portable, so I bought one as a replacement, not thinking much of it.

Over the next 3 months, I ended up using it extensively throughout my travels, not just as a towel, but as a blanket on cold flights or chilly evenings, a sarong in temples, a scarf when it was cold, a bed on the floor of the airports. My Turkish towel quickly became the most used item I carried in my bag. As I approached the end of my trip and started to focus on what I’d pursue when I returned to the states, the answer seemed obvious. If I had never heard of this incredibly useful yet simple product, there must be other people in the same boat.

Now, three years later, we are one of the largest Turkish towel brands in the US and have sold over 50,000 towels & blankets to customers all over the world.

Can you tell us a story about the hard times that you faced when you first started your journey?

After testing the concept for a few months, I brought my friend Kevin on as a partner and we decided to launch a Kickstarter campaign to raise some initial capital. It was somewhat successful, and we ended up raising around $15,000. After the Kickstarter though, we hit a wall. Our personal networks had been exhausted and we had no idea how to drive traffic. I decided to attempt Facebook ads, which was initially a huge failure. I took our business bank account from $15,000 to around $1,500 in 6 weeks. Knowing that we were on the verge of failure, I turned off our ads, locked myself in my garage for a week, and consumed multiple Facebook Ads courses. At the end of that week, we launched some new campaigns. They had 5 days to turn a profit before we were completely out of money. Luckily for us, it worked, and our ads turned profitable 2 days after we launched them. Looking back, that first $13,000 spent on Facebook wasn’t really wasted but was more like a $13,000 Facebook ads crash course.

Where did you get the drive to continue even though things were so hard?

When times get tough, I find it’s important to remember the reason I was driven towards entrepreneurship in the first place, and that reason is time ownership. Don’t get me wrong, I love to work. There’s no better feeling than defining a goal, putting your all into it, and actually achieving it. That being said, the idea of having 40+ hours a week, every week, spoken for by someone else is something that I’ve never been able to stomach.

People tend to ignore the fact that life is pretty short, often shorter than we expect. I want to be able to live it on my own terms. As a business owner, I tend to work longer hours than I did as a full-time employee, but it’s by choice. I choose when to work, what to work on, and where to work from. If I want to take a Tuesday off to hang out with my family, I can. If I want to relocate to Hawaii for a few months, I can. If I want to work until 4am and sleep until noon, I can! Having this control over my life is incredibly important to me, and reminding myself of such is enough to get me through any struggles as a business owner.

So, how are things going today? How did grit and resilience lead to your eventual success?

Today, things are going very well, our business is stable and growing consistently. We didn’t get this far without making a few mistakes that nearly cost us our business though. Scaling a business is challenging, especially when you start turning a profit with only a few thousand dollars. Cash flow is a nightmare, keeping 50+ SKUs in stock while gradually scaling a small business is a nightmare. There were 3 separate occasions where we were on the verge of failure due to cash flow related issues. We managed to weather all 3 of those storms and, in the process, learned a ton from each major mistake. Without grit and resilience, our business would not have made it 3 months past our initial Kickstarter launch.

Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?

I tend to have a very “do it yourself” personality, so much so that it’s caused us to nearly shoot ourselves in the foot a few times. The best example of this was when we landed our first large wholesale deal with FabFitFun. They ordered several pallets worth of product, which we shipped by freight. The shipping service we used delivered the product to the port, and it was up to us to organize the shipment from port to FabFitFun. Being the DIYer that I am, I decided to save the money on shipping service, and rather rent a truck, pick up the product myself, and deliver them to the end destination to save a few hundred dollars.

On the day of delivery, I went to the rental company to pick up my truck. Unfortunately, they had run out of the option I had selected, and only had open top, flatbed trucks available. Being the set delivery day, I didn’t really have a choice, so I took the flatbed. Upon arriving at the pallets, I found that they were incredibly top-heavy, and about 4 feet taller than the wooden slat walls of my flatbed truck, plus half the pallets were broken on the bottom, making them off balance. Again, I didn’t want to be late on our first-ever wholesale delivery, so I had the pallets loaded in so that the broken ones leaned against each other at the center of the truck.

Somehow, this jerry-rigged flatbed truck carrying $50,000 worth of product made it 95% of the way there without any issues. As I exited the freeway though, I hit a pothole causing a domino effect that knocked over 4 pallets. A few boxes fell out of the truck, so I pulled over, tossed them back in, and eventually pulled up to the delivery destination with a few standing pallets and about 100 loose boxes. Luckily for me, the guys working that day were incredibly friendly and thought the story was hilarious, as they had never seen the owner of a company actually deliver a wholesale order themselves. They helped me load the boxes on to new pallets and the delivery was, miraculously, a success.

I learned a valuable lesson that day about outsourcing. Obviously it’s important to save money when you can and learn to do things in the house, but certain things are better left up to the professionals… like transporting tens of thousands of dollars worth of product in a giant truck when you’ve never driven anything bigger than a VW.

What do you think makes your company stand out? Can you share a story?

One thing that I think makes our company stand out is that we truly are a bootstrapped operation. Customers often assume that we are a large corporation, but outside of manufacturing, everything from our creative assets, to our advertising campaigns, to our website design, to our customer service, to our wholesale business, is run by two people, my partner and I. We’ve taught ourselves how to take and edit high-quality photos and videos, how to manage large advertising budgets on Facebook and Google profitably, how to build a website, how to build an audience on social media. All of these things, we’ve taught ourselves using free online resources and we’ve learned so much in the process.

Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?

This answer seems obvious, but balance is the key to preventing burn out. Burn out is a very real thing, especially in the early stages of a business. My partner and I live in different cities, and I spent the bulk of a year working alone in my room. When you work alone, there’s nobody guiding you, nobody reminding you what you have to prioritize each morning, nobody making sure you’re staying productive, nobody judging you for taking a nap at 2pm. It can be easy to slack off when the only person holding you accountable is yourself. That’s why giving yourself time to enjoy your life, to exercise, to relax, are all very important.

Starting a business can be an incredibly stressful experience, and you need to be suited to handle that stress. You’re most suited to handle stress and hold yourself accountable when you’re healthy and happy. If you don’t prioritize health and happiness, it’s easy for productivity to slip and for anxiety to take over. While I love to work, I also love to travel, surf, climb, read, browse Reddit, etc. Work hard, but not so hard that is causes the quality of your work to deteriorate. Take breaks, even if it's just to step outside for 5 minutes and get some fresh air. Don’t be too hard on yourself.

None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?

Being that most of what you see when it comes to Teema was created by two people, I’m going to have to give this one to my partner, Kevin Welti. We’ve effectively built this business from the ground up with little to no pay and very little guidance. We just pick things up and learn them as we go. A big part of what makes Teema great is our arsenal of high quality, lifestyle content, and Kevin is to thank for that.

Kevin is a photographer but was mostly focused in nature and landscape photography when he started working on Teema. Figuring out how to shoot towels on a shoestring budget in such a way that the towel’s tassels could be easily cropped in post-production was a challenge. After having to reshoot our entire inventory a few times, Kevin went on Amazon and bought a few LED strips and some rolls of wax paper. Basing his design off of an $80k product photography station we’d seen youtube, he rigged $18 worth of materials to a glass coffee table, creating a soft backlit surface for shooting, meant to ease the editing process and make our towels pop a bit more. To our surprise, it worked like a charm and to this day we still use it to shoot new products on.

These are the types of things we take pride in at Teema. It’s incredible how far a little ingenuity and determination can take you. Our content has attracted the attention of multiple notable brands, media outlets, and influencers and we’ve never rented a studio or hired a photographer for any of our content, we create it all ourselves, in my garage, at local parks and beaches, wherever.

How have you used your success to bring goodness to the world?

Our towels are made in a traditional Turkish town where many of the families own looms and have owned looms for generations. These families put food on the table by running these looms, and by bringing our business to this town, we’ve been able to provide over a dozen households with a consistent source of income. As we grow, we hope to add authentic textiles from all over the world to our collection, and in turn, support the communities that make our products.

What are your “5 things I wish someone told me before I started leading my company” and why. Please share a story or example for each.

1) Business fundamentals are very important

Outside of a few business classes in community college, I never had much of a formal business-related education. I didn’t think I needed it, that business is straightforward, you buy things in bulk, sell them for more, and cut the profit. While that is true to a degree, it’s a massively oversimplified view of business.

When I first started Teema, cashflow wasn’t much of a consideration. I didn’t anticipate how hard it would be to scale without a large sum of cash to invest in inventory. We had to constantly increase the size of our orders, which meant that all the profit we were making had to be reinvested into growing the company. We were technically making hundreds to thousands per day in profit, but we never had a large sum of cash on hand.

We’ve since consulted a bookkeeper and accountant to get our finances in order, and it’s been an absolute game-changer. We now have an accurate picture of where we stand, rather than just gauging things off of a bank account that doesn’t account for accounts payable, accounts receivable, inventory value, etc. Knowing these things is absolutely essential if you hope to run a sustainable business on a large scale.

2) Diversify your traffic sources

The most challenging part of starting an online business is, by far, driving traffic. There are many ways to do so, most of which cost money. If/when you find one that works, it’s very easy to get comfortable, but it’s still very important to diversify these sources. After failing at Facebook ads for months and wasting thousands of dollars, we eventually found an ad/audience that was profitable. We were able to run and scale this campaign for around 8 months. I didn’t really think about it at the time, but our entire business was fully dependent on a single Facebook ad campaign.

Well as it turns out, Facebook campaigns generally have a lifespan, and eventually, they die out. After 8 months, this particular campaign’s performance started to quickly deteriorate. Almost overnight, we went from a company consistently profiting hundreds per day to a company bleeding $200+ a day on an unprofitable Facebook campaign. I didn’t plan for this, had more bills than cash on hand, and thousands of towels that I now didn’t really know how to sell. This was a wake-up call and the second time we nearly didn’t make it out alive. We now run ads on Google, Facebook, and Instagram, we run consistent email campaigns, we work with micro-influencers, and we have a team that helps land us PR placements (like this one!) Now, if our Facebook campaigns all of a sudden stop working (and they do, frequently), we still have Google and other sources to pick up the slack.

3) Focus on customer retention

This goes hand in hand with number 2. Nobody is more likely to buy your products than a person who is already a happy customer. They do not need to be sold on your product, they already have it and like it, they just need to be reminded about it from time to time. And guess what? Advertising to a person who has already bought your products and given you their email is… free! That’s right, the best traffic source you can possibly market to is the only one you can market to for free. And this traffic source grows with you, it gets bigger and more effective every day.

DO NOT forget about your existing customer base. Give them the attention they deserve, respond to inquiries quickly, offer easy returns and exchanges, run multiples sales each year, send them emails a few times a month. While some of these things may cost you money in the short term, they will pay off handsomely in the long run. Happy customers spread the word about your business. A potential customer referred to your site by a friend is statistically much more likely to convert than a potential customer who clicked your Facebook ad. This is the whole point of building a brand, the goal is to get to a point where you have so many happy customers that they handle a lot of the marketing for you.

4) Always be planning

When I placed our first container-sized order in August for Christmas of that year, I thought it was funny that I was considering Christmas as early as August. As it turns out, I was late and should’ve placed our Christmas order in June. Manufacturing tens of thousands of towels take a lot of time, shipping said towels by freight takes a lot of time, customs takes time.

We didn’t have the money upfront to pay for this order and we were placing it under the assumption that we’d be able to sell a large chunk of it during the Christmas buying season. Well, the Christmas buying season was approaching fast, and our container full of products that we couldn’t afford was still in the middle of the Atlantic ocean. We ended up getting the product 8 days before Black Friday. Had any single event occurred that had caused a 1–2-week delay, there’s a good chance we might not be in business today, simply because we didn’t plan enough ahead.

5) Don’t Overstress

I saved the best for last! Unless you get really, really lucky, starting a business is an incredibly stressful endeavor. Stress isn’t necessarily a bad thing, as it can often be the force that wakes you up and causes you to take action when things aren’t going as planned. Too much stress though, is a bad thing, as being overstressed can cause your work to deteriorate.

I find that when feeling stressed, it’s important to identify what the source of the problem causing you to stress is, and write down a list of the things that can be done to address the said problem. Either you’ll end up with a list of actionable tasks, or you’ll realize you’re stressing over something that’s completely out of your control (like whether or not your container in the middle of the Atlantic will arrive in time for Black Friday). Often times the most stressful situations are the ones you can’t control, and that type of stress is a waste of energy. While it often feels impossible not to stress, it’s important to remember your productivity will improve dramatically if you choose to only stress over things you can control.

You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

If I could start a movement right now, I would encourage people to take a technology hiatus of at least 30 minutes every day, even though it would be bad for business. Technology has enriched our lives in many ways, but it’s also been set up in such a way that it’s almost designed to induce anxiety. While it’s important to keep up with everything online, friends and family, work, news, etc. It’s more important to keep up with our own mental health. Something as simple as sitting outside for sunset, reading a book, or taking a walk every day can do wonders for your overall mental health. Give it a try!

How can our readers follow you on social media?

Follow along with our business as we grow @teematowels on Instagram! Or if you’d like to contact me directly, feel free to add me on LinkedIn @npstobie!

This was very inspiring. Thank you so much for joining us!