11 minute read
HAPPY FEET: Andrew Heath ’99
By Becky Purdy
The most requested donation item at homeless shelters is socks. New, durable socks.
And socks are what Bombas, a company co-founded by Andrew Heath ’99, does best. Launched in 2013, Bombas makes premium socks in fetching styles, designed for foot-pleasing comfort and customer-pleasing durability, at prices that beat high-end sock competitors.
With a business model built around giving back and with annual sales approaching $250 million in 2020, the company’s success has helped to clothe people in need. For every pair of socks Bombas sells, the company gives a new pair to the homeless community. To date, Bombas has donated more than 43 million pairs of its socks to shelters and other organizations serving homeless people around the United States.
Andrew Heath ’99, co-founder of Bombas Socks
Photo: Courtesy Bombas
Andrew, an entrepreneur with a knack for streamlining operations, has served as chief operating officer for the company since its founding, and for the first five years, he also was the chief financial officer. He and his younger brother, David, the chief executive officer and a company co-founder, are the perfect entrepreneurial complements to each other.
“It’s very yin and yang. There’s a commonality. We have a very strong business sense and business morals and ethics, but he’s on the marketing, sales, business development, and passion-about-the-product, customer side, and I’m all numbers, logic, operations, figuring all that stuff out. It’s funny, in high school I said, ‘It’d be really interesting to work with you in the future.’ We still weren’t quite seeing eye to eye. We still had our rough edges around each other, but now it’s actually an amazing relationship.”
At Bombas, Andrew manages operations directly, including logistics, fulfillment, transportation, sourcing, legal, planning, and what the company calls “customer happiness.” People are central to this work. A large portion of Andrew’s day-to-day involves coaching and mentoring the people who report to him, including coaching them on coaching others.
Coaching, he points out, is different than directing or micromanaging. Rather than trying to convince employees to make decisions that he wants, he coaches them to arrive at good decisions that they want. “That’s ultimately how great leaders are made, I believe,” he says, and he has watched many of the people who report to him emerge as strong, effective leaders.
The distinction between coaching and directing is important — and empowering. And this management approach is one of the reasons that Bombas is known for its positive workplace culture. Transparency and trust are pillars of that culture, according to Andrew. And mistakes, he says, are teaching moments. “I don’t want people to be afraid to admit that they’ve made a mistake. I want people to have a sense of understanding that we’re all human,” he says. “When people do make mistakes, I just talk to them about it. It’s not a slap on the wrist. … I think you learn most from your mistakes, so if you’re always fearing making mistakes, then you’re not taking any risk and you’re not trying to expand or extend your own skill set.”
Andrew’s Loomis Chaffee coaches were among his own earliest mentors. Faculty members Fred Seebeck and Edward Pond coached him in water polo, a sport in which Andrew excelled, and he looked up to both of them and the way they viewed winning, losing, and putting one’s best effort on the line. Jeffrey Scanlon ’79, Andrew’s dorm head in Batchelder Hall, also had a strong influence.
Andrew first heard about Loomis from Fred, who worked at the summer camp in New Hampshire that Andrew attended. The idea of going to a school that was like an academic sleepaway camp appealed to 14-year-old Andrew, and after considering several boarding schools, he ultimately decided he liked the atmosphere at Loomis, arriving as a freshman from Armonk, New York, in 1995. Andrew fared well academically and athletically at Loomis, playing varsity water polo and performing with the Jazz Band and Concert Band as well as learning the fundamentals of band conducting. He went on to Occidental College in California, where he majored in economics for business and management and played water polo, graduating in 2004.
Immediately after college, Andrew worked in finance. He took a temporary job at UBS Securities, worked hard, and soon was moved to full-time status as an investment banking analyst. He continued at UBS until joining a startup finance firm in 2007. That venture was cut short by the 2008 financial crisis.
Andrew caught his breath from the long hours and hard-driving pace of the first few years of his career and eventually joined a small company, where he quickly discovered his interest in and talent for operations. His ability to problem-solve and to consolidate processes — he streamlined one week-long process into a four-hour report — helped the company operate much more efficiently.
“I had been in finance prior, so I had never really experienced the business side of the work,” he says. “Once I started working with people and understanding what they did, my brain took it over as a [problem] that needed solving. How could I make people and their tasks more meaningful and efficient?”
He started simply, by showing his coworkers the power of spreadsheets. Creating a set of training workshops in the advanced features of Microsoft Excel, he showed his colleagues ways that using formulas and macro functions could streamline tasks that previously took hours of drudgery. “I had become quite proficient at automating processes for my own use,” he recounts. “I quickly realized that if other people could do the same, they would be doing less data entry and copying and pasting and [could] focus on other tasks.”
With growing interest in the operations side of the business world, Andrew enrolled in Babson College’s F.W. Olin Graduate School of Business, a school focused on entrepreneurship, where he earned a master’s degree in business administration in 2012.
While Andrew was still in graduate school, his brother David asked him for help building a business plan for a startup.
David laid out his idea for Andrew. “I said, ‘You’re nuts. You want to start a sock company?’” Andrew recalls. Yes, his brother replied, he wanted to start a sock company, one that sold its products only online and directly to consumers and that donated a pair of socks for every pair the company sold. After two years of research and product development, David, Andrew, and two other founders, Randy Goldberg and Aaron Wolk, launched Bombas in 2013.
The company’s mission from the beginning was to help clothe people affected by homelessness. “We were building this business to solve the problem,” Andrew says. “Let’s create the best sock we can possibly create, and if we create the best sock, people will want the best sock, and therefore we’ll be able to donate another sock.” If the company just broke even, that was OK, he says.
In 2014, David Heath and Randy Goldberg pitched the Bombas business idea on Shark Tank, the ABC television show in which a panel of experienced investors considers the pitches of entrepreneurs, who hope to convince the experts to invest in their ventures. David and Randy’s pitch had two key elements: a neglected need and a compelling product that could help address the need. People experiencing homelessness needed good, durable socks, they explained, and Bombas’s extensively researched and developed socks, boasting high-quality materials and construction as well as fun colors and designs, would appeal to consumers, who also could feel good about the sock donations that their purchases triggered. It was a win-win.
One of the Shark Tank stars, FUBU founder Daymond John, loved their idea and invested $200,000 for a 17 percent stake in the company. (FUBU, which stands for “for us, by us,” is an American hip-hop apparel company.) In interviews, Mr. John still cites Bombas as a shining example of a great brand that started from scratch.
Sales at Bombas, already strong, rocketed after the show aired, and Bombas became the highest-grossing deal in Shark Tank's 11-year history, according to the show’s producers. The company had $1.8 million in revenue in 2014, its first full year in business, and the sock brand’s momentum has continued to build. In 2019, the company reported $171 million in revenue, and as of late 2020, Bombas was on track to reach sales of between $240 million and $250 million for the year, Andrew says.
Bombas’s founders chose a market position with room for growth. At the low-cost end of the sock market are tube socks sold at big-box stores, and at the high end are companies like Nike and Under Armour that sell specialized athletic socks at $18 or more per pair. Through years of research and development, Bombas came up with a high-quality sock that was more affordable than the big names and more durable, better performing, and more comfortable than tube socks, Andrew says.
Bombas socks cost between $12 and $20 a pair, depending on style, height, and materials. “We do understand that not everyone can afford socks for $12 a pair,” Andrew says. To improve affordability, the company sells packs of socks at a discounted price per pair and offers carefully timed sales, such as a 20 percent discount on all purchases during the most recent holiday season. While these prices won’t undercut the mega-packs of socks from wholesale stores, Andrew says a seven-pack of Bombas socks, one for every day of the week, will outlast a 16-pack of socks from Costco and feel great on your feet.
“I don’t think people realize how great our socks are until they’ve tried them,” Andrew says. Made with high-quality natural fibers, each pair of Bombas socks features a heel cup, arch support, and no-rub toe seams, and the company reports that its socks last three times longer than regular socks.
Customers also like the way the socks look, and with dress socks in single colors and patterns, casual socks in both subtle and festive designs, and athletic socks in a variety of heights, colors, and activity-specific offerings, Bombas designs socks for a range of needs and sartorial tastes. Bombas also sells fetching and fun socks for babies, toddlers, and older children.
Bombas stands by a satisfaction guarantee. “If your dog ate your sock, we’ll replace it. If your laundry ate your sock, we’ll replace it. If you get a hole in your sock in two years, we’ll replace it,” Andrew says. And he knows all about dogs’ affection for socks. Not long ago, his parents found 10 socks that their dog had buried in the yard.
As Bombas’s sales have grown, so have its donations to homeless shelters. From its initial partnership with one organization, Hannah’s Socks, for distribution of donated socks, Bombas now has more than 3,500 donation partners in all 50 states.
Initially, the company made two pairs of every sock it sold, one pair for the customer and an identical pair for donation. But homeless shelters identified special qualities their clientele needed in socks: extra durability and the capacity to be worn more than once between washes. Based on the feedback from the homeless community, which Bombas sees as an important customer for its products, the company developed a black sock with reinforced toe seams and an anti-microbial treatment as the standard donation sock. Eventually the company added some other colors for the donation socks, especially in kids’ sizes.
Giving also is baked into the workplace at Bombas. All employees are expected to volunteer for a certain number of hours every month. Bombas also holds volunteer events, such as a twice-monthly breakfast event at a foodbank in New York, where Andrew, David, and other Bombas employees cooked omelets and egg sandwiches to order for foodbank clients. During the pandemic, the company’s head of giving has organized donations of personal protective equipment (PPEs) and other items to front-line efforts. Andrew says the company considered switching its manufacturing from socks to PPEs during the crisis but decided it should remain focused on what it does best, and the economic devastation wreaked by the pandemic has only increased the needs of the homeless community.
Because Bombas sells its products entirely online and directly to customers and because almost every aspect of the business can be run remotely, COVID-19 has not had a drastic impact on the company’s bottom line. Bombas had just opened a new headquarters in New York City when the pandemic swept in last spring, but the company told its employees they could go wherever they needed to be, even if that meant moving across the country to live with family on the West Coast. Since then the new office space has been mostly shuttered, and Andrew says the headquarters won’t reopen until March 2021 at the earliest. And while Bombas eventually will want to reconvene its team of employees at the office, they will not be required to move back to New York immediately.
Of the many lessons he learned at Loomis, Andrew says, the most profound was the importance of finding balance in one’s life. From the yin/yang of his partnership with his brother to the giving-back model of Bombas’s success and the emphasis on the people of the company’s workplace, the importance of balance continues to resonate in Andrew’s life.
