Serial entrepreneur Ori Rosenbaum turned pain into profit.
Tired of designer dress shoes that pinched his feet, Rosenbaum created a line of his own with Laguna Beach-based Auri Footwear Inc.
The company expects to generate $1 million in sales this year and projects it will hit $4 million in revenue next year making comfortable men’s shoes.
Auri makes dress shoes, sneakers, boots and sandals with Italian leather, sheep-skin lining, extra cushioned soles and a patented material that controls temperature.
The shoes, which boast quirky names such as cougar bait and ladies man, sell from $155 to $225.
They’re sold at Fred Segal Feet in Los Angeles, The Shoe Cellar in Laguna Beach and stores owned by Santa Barbara-based Walking Company Holdings Inc.
The shoes are targeted at men younger than 60.
“They’re sleek but they’re low profile and function like a running shoe,” Rosenbaum said.
Rosenbaum started Auri last year after noticing a void of men’s shoes that are orthopedic and stylish.
“You have sneakers and high-fashion brands and on the other side of the spectrum you have things my dad wears,” Rosenbaum said. “I couldn’t fathom that there weren’t beautiful shoes that are comfortable. I looked and looked but couldn’t find any.”
Rosenbaum has trekked the entrepreneurial path before. He’s run a string of startups in the past 20 years.
The San Francisco native and his brother started Spectre Performance, a maker of automotive products, out of their parents’ garage in 1983.
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Rosenbaum: likes adrenaline rush of a startup |
Rosenbaum ran Spectre with his brother for six years before selling his shares in 1989.
He then started a speaker company called Back Seat Drivers that sold to Oklahoma’s Stillwater Designs and Audio Inc. after it debuted at the International Consumer Electronics Show.
In 1996 Rosenbaum started Omicron Technologies Inc., a consulting company that specializes in consumer product design, development and production that handled projects for Apple Inc., Toyota Motor Corp., Sony Corp. and General Motors Corp.
As a self-proclaimed workaholic, Rosenbaum said he was looking for the adrenaline rush that comes with running a startup when he started Auri Footwear.
To make a dent in the overcrowded men’s shoe market, he said he had to surround himself with experienced executives.
Rosenbaum tapped a board-certified podiatric surgeon and executives from the apparel, retail and technology industries to give him a crash course in the shoe business.
He learned about the mechanics of foot movement, the concepts that go into the research and design of shoes and the logistics of handling production, inventory and sales.
The Israel-born executive is using his own money to finance Auri but is mum about how much he has spent on the company so far.
“I walked away from a lucrative career and financed it all myself. Just thinking about that alone makes me pop out of bed like a vampire,” Rosenbaum said.
Auri counts 10 workers at its headquarters where it handles research and design, marketing and sales.
The company assembles its shoes at a factory in Asia with materials from Italy, Japan and Germany.
The shoes are then shipped to retailers through contract carriers.
Auri, along with 90% of the shoe industry, opts to make its shoes overseas because it’s more affordable to do so.
Auri will have to keep a watchful eye on managing cash and costs this year, Rosenbaum said.
The company plans to get into more stores by hitting up trade shows. International sales also are in the works, he said.
Auri plans to invest more money in marketing to get the word out about its shoes too, he said.
The company is giving away shoes in celebrity gift bags and tapping famous faces to wear its products through Stars for a Cause, a Los Angeles nonprofit.
Celebrities who wear Auri include Benjamin Bratt and Jamie Foxx, among others.
Scuba Gear
Irvine-based Scuba.com Inc. is expanding undercover and overseas.
The company generates $12 million in yearly sales selling scuba tanks, wet suits, snorkels, gauges, fins and other products that scuba diving aficionados need for their deep-sea adventures.
Scuba.com recently outfitted its Web site to handle international orders and also inked a general service agreement to sell scuba diving gear to the government.
“We’ve got a lot going on now,” said cofounder and Chief Executive Melinda Herndon.
Herndon expects the projects to help generate sales and strengthen the company’s brand during an economy where retailers are getting smashed.
Scuba.com competes with a handful of other Internet sellers of scuba diving equipment such as scubatoys.com and diversdirect.com.
Scuba.com operates out of a 20,000-square-foot warehouse where it employs 30 workers, including a handful of certified scuba diving instructors who handle customer service.
The company offers more than 20,000 products and ships them for free with the help of contract carriers.
Scuba.com started out as a retail chain before becoming an Internet business.
Herndon’s husband got her into scuba diving in the 1980s.
She decided to leave her career in real estate to open a scuba diving equipment shop in 1990 called Divers Discount Supply.
The Herndons grew Divers Discount Supply chain to eight stores around Orange County.
During the mid-1990s, they started selling products on the Internet through three sites they owned: diversdiscount.com, escuba.com and scuba.com.
Scuba.com, which was the catchiest of the three sites, started to grow.
By 1999, the Herndons decided to close up their stores and become an Internet-only business.
But that is starting to change.
“We’ve noticed that more people want to come by our warehouse to buy our products,” Herndon said.
The company recently built out a showroom for customers who want to check out gear and pick up orders, she said.
Scuba.com also added on a repair department where customers can stop by and fix their equipment on site, she said.
But these days, Scuba.com is feeling the pinch of the economy.
The average number of purchases on the company’s Web site is lower this year than it was last year, Herndon said.
She said that she’s noticed more customers pulling back from buying luxury equipment and opting for more moderately priced equipment.
The company plans to get through this economic downturn by implementing more technology to manage costs and inventory better.
Sun Protection
Skin Elements USA LLC in San Clemente expects to hit $1.5 million in sales this year making organic sunblock.
The company makes sunblock under the Sol & #233;o Organics and Natralox brands.
The sunscreen is made without harmful chemicals, synthetic preservatives, titanium dioxide,which some studies have suggested may be a carcinogen,or fragrances.
The products are waterproof and have an SPF of 30 or higher.
Sol & #233;o sunblock sells for $25 at natural grocery stores such as Mothers Market, surf shops such as DVC Ride Shop in San Clemente and hotels and resorts such as the Wynn Las Vegas Hotel & Casino.
Skin Elements makes its products in Australia and sells to stores directly and with the help of distributors.
Aussie Peter Valone and a group of investors started Skin Elements in 2006 and tapped former investment banker and OC native Richard Sample to help run the company as chief executive.
Both men saw a chance to carve a niche in the sunscreen business with organic products that could appeal to both moms and surfers who are conscious of healthy lifestyles and the environment, Sample said.
“We really saw a need for organic sunscreen,” Sample said. “People are becoming a lot more aware of the environment and living a healthy lifestyle by using natural skincare products.”
They also saw an opportunity to capture business from consumers with sensitive skin who can’t use regular sunblock because they’re made with synthetic chemicals and preservatives that irritate their skin, Sample said.
That’s not to say there isn’t competition.
Skin Elements rivals other synthetic chemical-free sunscreen makers including New York’s Kiss My Face Corp., Oakland-based Clorox Co.’s Burt’s Bees Inc. and Florida-based Aubrey Organics Inc.
Skin Elements is trying to carve its niche by catering to customers who need extremely waterproof sunscreen and those who travel and spend a good chunk of their time outdoors, Sample said.
Skin Elements joined the Aliso Viejo-based Surf Industry Manufacturers Association to deepen its ties to the surf industry, he said.
The company, like others who manufacture overseas, is battling the weak dollar.
The economy also has taken a toll on the consumer products industry. But Sample said he believes that the growing demand for organic products will continue to help the company generate sales.
Skin Elements has been hitting the trade show circuit to get the word out about its products.
This year the company will offer low-cost and high-end versions of its sunblock and a line of anti-aging skin lotions.
