SmartWool's Ride

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Vol. 22, No. 217

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Plan some weekend fun

Iron Horse interest low

Sailors down Demons, 2-0

Check out music and art events across town

Inn’s history does not bode well for proposals

Steamboat boys soccer shuts out Glenwood

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SmartWool’s Ride I t’s not your typical company retreat. But then, SmartWool isn’t your typical company. Beginning today, a two-part series looks at how a 360-mile bike ride reveals the values and culture of one of Steamboat’s biggest success stories.

Today: SmartWool employees begin their adventure to the Outdoor Retailer trade show in Salt Lake City.

Saturday: SmartWool hasn’t always enjoyed such a commanding presence on the trade show floor, but it’s been nothing but up for the company founded in 1994 in Steamboat Springs.

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■ Index Briefs . . . . . . . . . 10 Classifieds . . . . . 33 Comics . . . . . . . 31 Crossword . . . . . 31 Explore . . . . . . . 19 Happenings . . . . . 7

Horoscope . . . . . 32 The Record . . . . 10 Scoreboard . . . . 30 Sports . . . . . . . . 27 ViewPoints . . . . . 8 Weather . . . . . . . 41

Thursday night’s Cash 5 numbers: 2-6-17-18-29 MatchPlay numbers: 3-14-27-29-30-37 Mega Millions: 8-18-22-24-38; 23

■ weather Sunny and breezy.

High of 65.

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SmartWool’s Ride An ambitious trek across Western roadways reveals the values and culture of a Steamboat success story Story and photos by Matt Stensland

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or some SmartWool employees it will be one of the greatest athletic achievements of their lives. For the “Little Guy” embroidered on their socks, the 360-mile bike ride to Utah is just another leg in a 16-year journey as the icon for the Steamboat Springs merino wool apparel company.

It’s late July, and 34 SmartWool and Timberland employees, sales reps and retailers have gathered for the the four-day ride that will take them most of the way to the Outdoor Retailer Summer Market trade show in Salt Lake City.

“It’s not painful,” said SmartWool President Mark Satkiewicz, describing the ride he started. “It’s a challenge.”

After the intense journey, they will join about 1,040 exhibitors and 40,000 people at the annual show. The ride is just another example of employees living the lifestyle the company promotes, both in its products and its people.

“It is the embodiment of the brand’s spirit,” said Jeff Swartz, CEO of Timberland, which acquired SmartWool

in December 2005.

Swartz, 50, aspires to participate in SmartWool’s ride.

“That ride is the spirit of active mountain lifestyle,” he said. “It’s not talking about it. It’s actually doing it.”

And SmartWool has been doing it well since it was founded in the mid-1990s. The company has grown every year, but skyrocketing revenues tell only part of the story.

At SmartWool, business success goes hand in hand with a company culture that stresses personal and professional growth.

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Steamboat Pilot & Today • SmartWool’s Ride • Part 1 • Friday, September 10, 2010 |

Steamboat Pilot & Today • SmartWool’s Ride • Part 1 • Friday, September 10, 2010

A map on display in the SmartWool booth at Outdoor Retailer in Salt Lake City shows the 360-mile route taken by the riders.

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SmartWool ride participants, from right, Tim Reinhart, Jordan Carr and Leslie Mittendorf cruise down a hill outside Vernal, Utah.

Ride stats

Supplies used along the 360-mile ride J 180 packs of Honey Stinger chews J 260 gallons of water J 30 lbs. of oranges J 30 lbs. of bananas J 5 dozen eggs J 2 bottles of ibuprofen J 2 dozen bike tubes J 10 tires J 1 spoke J 11,000 total miles ridden for a total CO2 reduction of 5.13 metric tons.

Source: Molly Cuffe, SmartWool communications manager

Bruce Gordon pours water over his head to cool off.

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itting on the saddle of a road bike for 360 miles during four days will challenge even the most experienced riders, who will rely on ibuprofen, muscle rub and diaper rash creams to make each subsequent day of riding across the high desert a little more tolerable. Rumble strips, shattered glass, animal carcasses, semis and 100-degree temperatures add to the physical and mental pain.

There will be exhaustion and illness, and some blood and tears shed along the way, but the companionship among co-workers and new friends make the ride possible and, more important, fun. So much so that even a novice can smile while tackling the 14-mile climb over Wolf Creek Pass that will deliver a downhill reward and drop them near Park City, Utah, from where they will then drive into Salt Lake City.

Norma Hansen, 46, is one of the 34 riders gathered at the Steamboat Springs Transit Center at 6 a.m. July 29 to begin the ride.

SmartWool’s director of special projects has been with the company for six years and just bought her road bike last summer.

“It was a sport I always wanted to get into,” Hansen said. “I always thought road biking looked so nice. A nice thing to do.”

She decided to do the ride after talking to her closest co-workers, who did the ride the previous year and had a great time.

“They were honest that it was hard,” Hansen said.

She started training with shorter rides around Steamboat and built up to a 70-mile ride to Columbine in North Routt County.

“After I did the 70, I figured I can probably do these 100-mile days,” she said.

Hansen’s luggage is stacked along with the others’ into three vehicles that will supply them with food and water throughout the trip.

SmartWool employee Tad Huser will drive one of the vehicles and serve as the ride’s bike mechanic.

The mood is almost as if all have put their lives on hold for four days and are headed on summer vacation. But instead of heading to airport security, they are pedaling 25 miles west of Steamboat to their first stop, Hayden.

SmartWool President Mark Satkiewicz gathers the group as riders get ready to depart. After introductions, he gives a summary of the day’s ride.

“One thing I want to emphasize to everyone is it’s not a race,” Satkiewicz said. “It’s 350 miles. It

Riders rest in front of GGs Coffee Shop in Hayden 25 miles into the first day of riding.

can get hot. It’s a long deal, so really enjoy it. was ranked as one of Outside Magazine’s 50 The biggest thrill of the whole thing is enjoy- Best Places to Work. ing time with all of us. Meet some people.

Company culture Have a great time.”

The riders casually depart the Transit If it’s a powder day at Steamboat Ski Center in small groups, passing a few Area, Satkiewicz doesn’t want to see you in Steamboat residents out on their morning the office. walks and curious about where all these A flexible schedule that allows workers to determined cyclists are heading. ski or bike during the workday is just one of The plan is to regroup at the reasons SmartWool again the second aid stop in Craig, received a top ranking from People enjoy being but the group gathers alongOutside. The ranking is based at work. People see side U.S. Highway 40 just six on figures provided by the it as more than a minutes into the ride when company and checked against place to go for eight confidential employee surveys.

Anna Leavitt, SmartWool’s North America sales operahours and make a “If you want to ride your tions manger, hits a rock and bike, pick a time. Just get your paycheck. It’s a crashes. work done,” said Trevor Walz, way of life.

“That’s never happened who works on SmartWool’s webbefore,” Satkiewicz says after site.

Trevor Walz Leavitt is checked out and There are other things that SmartWool employee arrangements are made to take keep employees happy. her to the hospital.

“My favorite part about my With miles of dangerous road ahead, it’s job is I never lie,” said Gardner Flanigan, not a great start to the ride, but it sends a who came to the company in 1997. “The message of caution as the riders continue product does what we say it does.” along the narrow shoulder on a busy twoEmployees receive the typical 401(k), lane highway. Several cyclists who have done health and dental benefits as well as three the ride before say this is their least favorite weeks of paid vacation a year. section.

“People enjoy being at work,” Walz said.

“People see it as more than a place to With the Yampa River winding along the go for eight hours and make a left side of the road and the Hayden Station power plant smoke stacks coming into sight, paycheck. It’s a way of the first stop, GGs Coffee Shop, is just a few life.” miles away.

“That looks like too much work,” says a construction worker holding a “slow” sign.

He probably does not realize the people riding past him are on the clock, doing something they consider one of the perks of working at SmartWool, which in 2010 again

“

”

During summer, the office closes at 3 p.m. on Fridays, with many of the employees going on group bike rides. SmartWool closes its office during four typical workdays each year. Two of those days allow employees to work some of the 40 hours of volunteer time they are allotted and encouraged to use each year. A companywide ski day in March lets employees enjoy the day together at the ski area. Summer Recess provides a barbecue at Howelsen Hill Park, rides down the Alpine Slide and team-building activities at businesses and organizations such as the Boys and Girls Club.

SmartWool also provides an activity pass that will pay for skiing, gym membership or activities such as yoga classes. That is in addition to a health and fitness allowance of $125. Employees also are rewarded for biking to work.

“We promote the active mountain life and anything to get people outside,” Satkiewicz said.

“We offer a career; we really want to run a long-term, profitable business that is going to be here for a long, long time.”

Nurturing the company’s culture will remain important as SmartWool tackles ongoing challenges such as acquiring young talent, like 28-year-old Walz, who can grow with the company, Satkiewicz said.

Walz, an avid cyclist with a bike chain tattoo on his ankle, is one of the 34 people biking to Utah. The Minnesota native wanted to move to the mountains but only if there was potential for a career.

“It couldn’t have worked out any better,” Walz said. “My work-life balance is pretty premiere.”

Packs form After a pit stop in Hayden, riders mount their bikes and pedal 20 more miles along U.S. 40 before heading south on Colorado Highway 13 to Meeker.

The sound of gravel ricocheting off the guard rails and carbon bike frames creates the soundtrack for the ride. Rion Smith, a sales rep who represents SmartWool and other brands, clips a dagger-shaped piece of pine that slices through the valve stem of his tire and shoots past the riders behind him.

Many of the riders manage to avoid or ride over a thick pane of glass, but Scott Belisle, SmartWool’s men’s apparel product line manager, hits it, slicing his tire.

After a stop in Craig, the riders begin to form packs according to their ability level and who they want to ride with.

Riders take turns in the front of the packs, blocking

Jordan Carr displays two products he is picking up at Walmart in Vernal, Utah, to ease discomfort.

the wind and creating a pulling effect for the riders who follow immediately behind.

A 13-mile gradual climb becomes the biggest challenge of the day, which turns out to be perfect for cycling, with an overcast sky and little wind.

The riders arrive in Meeker within about an hour of one another. After stretching and eating, they cool off in the frigid waters of the White River. Smart phones are used to update Facebook statuses. Some call home.

“You know what I saw today? Cows,” SmartWool retailer Marshall Merriam, of New England, tells his 3-year-old son, Baxter, while lying in the park grass.

Day One is in the bag, with a couple of hours to kill before the group takes over the Italian restaurant next to the hotel.

Riders, from left, Tim Reinhart, Trevor Walz, Ken Sung and Mark Satkiewicz wait for other cyclists in Utah.

The brutal chip-and-seal Friday presents the opportunity for a few of the riders to cross a century ride — a ride of 100 miles — off their cycling to-do list.

And the 113-mile ride to Vernal, Utah, would prove to be a memorable century.

The clouds have cleared overnight, creating the potential for a hot day.

Right: SmartWool employee Kate Schneider displays her crash wounds and tarstained jersey.

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Steamboat Pilot & Today • SmartWool’s Ride • Part 1 • Friday, September 10, 2010

The first taste of real heat comes in Timberland employee and former Dinosaur, 77 miles into the day’s ride. professional cyclist Tim Reinhart, with With 33 miles to go through the desert less than 10 miles to go. along U.S. 40, temperatures reach 100 Neither Reinhart nor any other degrees. Some of the riders already are rider makes a move to race for Vernal exhausted from the gradcity limits. It’s been a long ual 17-mile climb north day.

You’ve got Mack into Dinosaur along After pulling into the trucks and oil Colorado Highway 64. shade below the hotel trucks coming by Resuming travel roof at 1:30 p.m., Leslie along U.S. 40 means Mittendorf looks at a you at 70 miles the return of debris, 102-degree temperature per hour, and it’s rocks, traffic and rumreading on her bike comextremely hard to ble strips. puter. keep focused, plus In the lead pack, “I really want an Icee or a few of the riders slushy or something like you’re really tired. break away to race that,” she says.

It’s hot; you’ve to the Utah state line.

Walz dips his head been on your bike Rumors of construcunder a hose next to for four hours or tion on U.S. 40 prove the hotel entrance. His to be true, and a fresh, bike computer shows more. It’s a tribute smelly coat of tar and to everybody to just the riding time was five gravel greets the ridhours, 25 minutes with get done with days ers. The ride alongside an average speed of like that.

Dinosaur National 20.3 miles per hour.

Monument is gorRiders arrive at the Mark Satkiewicz geous, but the road hotel throughout the SmartWool president conditions are treachnext three hours, hot erous. And it’s hot. No and exhausted. shoulder has been painted Kelly Gorder, on the freshly chip-and-sealed road, SmartWool’s director of key and the rumble strips are hard to see. accounts, along with other riders “You’ve got Mack trucks and oil chose to take what would turn out trucks coming by you at 70 miles to be an ill-conceived detour into per hour, and it’s extremely hard to Vernal. “The death march” is how keep focused, plus you’re really tired,” Gorder described the road.

Satkiewicz later recalled. “It’s hot; “I think today was great preparayou’ve been on your bike for four hours tion for the last day,” she said. “It or more. It’s a tribute to everybody to makes your skin a little thicker.” just get done with days like that.”

Hansen, one of those riding for the The ride claims its second casualty first time, arrives at about 4 p.m. with when, with 10 miles left, SmartWool Bruce Gordon, a SmartWool sales employee Kate Schneider loses control rep who works for Mountain Source. and crashes.

“I think I was so happy to be at Ken Sung, co-owner of Gazelle the hotel that I didn’t feel any pain,” Sports in Michigan, gets three flats Hansen recalled. “I’m definitely the along the stretch of highway, has to last one in every time, but everyone is replace a tire and is forced to end the there cheering. I wouldn’t be able to day’s ride at a 7-Eleven outside Vernal do it without their support.” when he runs out of tubes.

Schneider gets a ride in after her “Final stretch, baby,” shouts crash and sits in the lobby waiting for her luggage. Her white jersey is covered in tar. She has removed most of the rocks that had dug into her skin.

Scrapes cover the side of her legs.

“It just really sucks. This is not good,” she says, looking at her stinging, injured hands.

“It happened at a century, so I’ve still done more than I’ve ever done before,” said Schneider, who will get back on the bike for Saturday’s “rest day,” a relatively easy 50-mile ride to the LC Ranch in Altamont, Utah.

“

”

Relax and reminisce

Mark Satkiewicz eats leftover pizza before riding into the LC Ranch in Altamont, Utah.

About three hours and 50 miles of cycling offer the promise of relaxation at the LC Ranch.

Leavitt, who crashed just minutes after the start of the four-day ride, is back on her bike.

Satkiewicz takes the opportu-

The crew plays a game while relaxing at the LC Ranch.

Mark Satkiewicz swims laps at the Old Town Hot Springs pool.

‘Enjoy life ... enjoy everything’

I

n a quest to meet his goal of biking to work 200 days this year, Mark Satkiewicz often could be found blazing down Fish Creek Falls Road in February on his bike wearing a snowboard helmet and goggles. nity to break When other people still were heading to work, Satkiewicz away from the likely already had finished one of his favorite rides, a 55-mile lead pack and visit with some loop taking him from Steamboat Springs to Oak Creek and of SmartWool’s back. Swimming and running help round out the 15 hours friends and customof training each week that would allow him to complete ers he has not yet ridan Ironman triathlon today. To add to life’s chalden with.

After breaking a lenges, Satkiewicz travels an average of two weeks spoke on his rear wheel a month as president of Steamboat Springs-based during the last short climb SmartWool. of the day, he sits on the But even when logging an average of 250 miles back of a support vehicle eating leftover Pizza Hut. on his bike during the summer months, “family The wheel is switched out, and is his No. 1 priority,” said his wife, Amy, with Satkiewicz leisurely pedals the whom he has two children. last 10 miles to the ranch and talks Satkiewicz admits that most would think about the ride.

He pitched the idea of riding to the his standards “are not normal,” but it’s how he trade show in 2007, in part as a way leads by example. to join the outdoor industry’s green “Our company is so aligned with that aspiramovement. tion,” said Satkiewicz, 41. “Get outside, enjoy “The other element that was going on in my head was the camaraderie or life, have a career, enjoy everything.” the team building that group rides do, Satkiewicz doesn’t regret trading in his bag of and so we figured we’d kill two birds Nike shoes to go to work for a sock company. with one stone and see how it went.”

After receiving his master’s of business adminTimberland had acquired SmartWool in December 2005 for $82 istration from Loyola University Chicago, a million.

12-year career in sales at Nike took him to five “As in any acquisition, you don’t cities — primarily flat ones. He found himself know how that’s going to play out,” running up any mound of dirt he could find, said Satkiewicz, who came to the company as vice president of sales seven imagining he was on a mountain trail similar months after the acquisition. to the ones he enjoyed during a stint in Sun That first ride, in which 22 people Valley, Idaho. participated, ended up playing a key He spent nearly 15 years trying to figrole in joining the companies.

“We had a couple of those ure out how to return to the mountains.

Timberland folks on the ride who we Former SmartWool President Chip didn’t know all that well,” Satkiewicz Coe provided the opportunity by hirsaid. “After the ride was over, we actuing him as vice president of sales ally all said that the ... relationship have a group that you want from that group started of 34 riders with in June 2006. Satkiewicz became to be fostered, and I put a lot of that varying ability, and president three years later. onto those four days.” they go into each “He’s a terrific athlete, he’s More than halfway to Park City, day much differently. a super hard worker, he’s Satkiewicz says this year’s ride is shap- The unique bridge is ing up to be the best yet. smart, a good family man, the strong riders here all “Yesterday was an interesting day recognize the effort it is for he absolutely loves the because it was 110 miles and you someone who is just getting outdoors,” Coe said. started. When the last two in “We were lucky to our group came in yesterday, a get him, and he lot of people were outside waiting for them and congratulating them on was lucky to get such a tremendous accomplishment.” us.”

Mark Satkiewicz provides some entertainment as he groans in pain while using a roller on his IT band at the LC Ranch lodge.

Most of the riders have made it to the ranch when Satkiewicz pulls in. Some already have changed into swimsuits and are headed to a nearby waterfall. Huser sticks his head under the chilly falls. Others wade in a pool below, where leeches are found, ending the waterfall party.

Fruit, deli meats, cheeses and junk food are spread out on a picnic table in a pavilion. The refrigerator and cooler are stocked with beer.

Clouds roll in, bringing a steady rain, the kind that is perfect to nap to. Some riders retire to their rooms.

Some explore the ranch. “Tommy Boy” is playing in a cozy cinema room packed with chairs, couches and animal mounts. A group of younger riders plays Pass the Pigs, a game that involves rolling two plastic pigs.

Laughter erupts every time the pigs land touching in an inappropriate position, causing a player to lose points.

Later in the afternoon, Satkiewicz grills burgers and chicken for dinner.

Tomorrow is the final push to Park City.

After dinner, Satkiewicz meets with the support crew to talk over logistics for the final day.

“Tomorrow is 100 miles. There is a 14-mile climb in there. It will be hot. It’s hard, but it’s the last day.”

Hansen admits she is nervous, but she is not alone. After organizing gear and looking over their bikes, most of the cyclists are in their rooms before dark.

“For many people, I think their energy and motivation will be high, but there will certainly be some trepidation for sure,” Satkiewicz said.

Coming tomorrow The riders make their way to Salt Lake City, where SmartWool will again flex its merino wool muscle as one of the elite outdoor apparel companies at the annual Outdoor Retailer show. Despite difficult economic times and changes in ownership, success has been consistent for the Steamboat Springs company.

S t e a m b o at

today

Saturday September 11, 2010

Steamboat Springs, Colorado

FREE

®

Vol. 22, No. 218

RO U T T

C O U N T Y ’ S

DA I LY

N E W S PA P E R

www.steamboatpilot.com

Rifle hunters take aim

Legendary instructor

Rams rally to victory

Bow season already under way in area

Buck Brannaman returns for horsemanship clinic

Soroco tops South Park, 34-27, at home

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SmartWool’s Ride

The conclusion of a two-part series Today: SmartWool hasn’t always enjoyed such a commanding presence on the trade show floor. Indeed, it’s been nothing but up for the company founded in 1994 in Steamboat Springs.

Inside

Correction In the story “Hayden, Soroco football win openers” on page 3C of the Sept. 5 Steamboat Pilot & Today, Tristan Palyo blocked a punt that was returned for a touchdown by David Strait during the Rams 16-12 win against Springer, N.M.

■ lotto

■ Index Briefs . . . . . . . . . 10 Classifieds . . . . . 23 Comics . . . . . . . 21 Crossword . . . . . 21 Happenings . . . . . 7 Horoscope . . . . . 22

The Record . . . . 10 Scoreboard . . . . 20 Sports . . . . . . . . 18 Sudoku . . . . . . . 21 ViewPoints . . . . . 8 Weather . . . . . . . 31

Friday night’s Cash 5 numbers: 2-8-16-28-30 MatchPlay numbers: 5-10-15-19-31-33 Mega Millions: 11-12-17-21-23, 20

■ weather Sunny and pleasant.

High of 71.

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SmartWool’s Ride An ambitious trek across Western roadways reveals the values and culture of a Steamboat success story Story and photos by Matt Stensland

W

ith one day left, the cycling portion of SmartWool’s ride to Salt Lake City is winding down. After 260 miles of pedaling, only 100 miles and Wolf Creek Pass stand between the 34 riders and their destination — the annual Outdoor Retailer Summer Market trade show.

The fun part is then over, and it’s back to work meeting with customers and selling the merino wool socks and apparel for which the Steamboat Springs company is famous.

SmartWool’s rise to industry leader status is thanks in part to the company’s founders, Peter and Patty Duke, who are starting their own entrepreneurial ride again with the Point6 sock company.

But at Outdoor Retailer, it’s SmartWool that’s firmly atop the merino wool sock world.

Despite the economy, the SmartWool team will arrive at the trade show bigger and stronger than it was before the Great Recession hit.

SmartWool President Mark Satkiewicz congratulates an exhausted Norma Hansen after completing the four-day, 360-mile ride to Park City, Utah.

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Steamboat Pilot & Today • SmartWool’s Ride • Part 2• Saturday, September 11, 2010

Steamboat Pilot & Today • SmartWool’s Ride • Part 2• Saturday, September 11, 2010

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n paper it’s not the longest section of the four-day ride, but the elevation profile makes this 100-mile stretch from Altamont, Utah, to Park City, Utah, the most challenging.

Throw in 100-degree temperatures and this day has the potential to turn hellish quickly.

“I don’t think a lot of people really understand how hard it is to ride that long, or for eight, nine, 10 hours, across the desert in 100 degrees,” said SmartWool President Mark Satkiewicz, recalling the ride’s second day — a 113-mile jaunt to Vernal, Utah. The third day was only 50 miles and was meant to serve as a rest day.

Anxiety, nerves and a 5:30 a.m. departure time for the first group had many of the riders in bed before the sun set. A group of seven of the stronger riders, which includes Satkiewicz, leaves the Altamont ranch at 6:45 a.m., one hour, 15 minutes behind the first group. The goal is to rendezvous at the top of Wolf Creek Pass for lunch and a group picture.

“We’re going to ride hard,” Satkiewicz had said the day before.

Satkiewicz, Trevor Walz, Timberland’s Tim Reinhart and Mountain Flyer 1994 Magazine writer Jordan SmartWool Carr stick together up the pass, keeping their speed is founded in in the double digits.

Steamboat by More impressive is former ski instructhat all the riders — tors Peter and encompassing the Patty Duke. About full spectrum of $300,000 in sales are ability levels — made the first year. who started the pass, finished it.

SmartWool’s 1995 director Philadelphia-based RAF of special Industries invests six figprojects,

The story so far

SmartWool President Mark Satkiewicz, center, visits with buyers from Michigan-based Playmakers Athletic Footwear & Apparel during the opening day of the Outdoor Retailer Summer Market trade show in Salt Lake City on Aug. 3.

Norma Hansen, a 46-year-old who just got into road biking last summer, is greeted at the top of the pass with loud cheers, applause and a hug ures in SmartWool, giving from riding partner and friend Bruce Gordon.

RAF 30 percent ownership of She also gets a high-five from Mark Bryden, the company.

SmartWool’s last president, who, in August 2009, left to become vice president and general manager of Timberland North America. Timberland 1996 acquired SmartWool in December 2005.

SmartWool sales exceed $2 milAfter a picture at the summit, the riders get lion. Sales nearly triple the next their final reward, the descent down the pass. year.

“It feels scary,” said Satkiewicz, referring to the 60 miles per hour he reached while catching up to the lead pack of riders on the descent.

1999 Riders share high-fives, congratulations, beer Steamboat Springs attorney Chip Coe and food 30 miles away in Park City, where the sells his practice and becomes chief group gathers one last time at a restaurant. From operating officer. SmartWool begins sellhere, they will drive to Salt Lake City. ing base layers.

“I’m very proud of being able to do it,” says the oldest rider, Michael Tebrich, a 58-yearold sales rep who has participated in the ride 2000 before.

SmartWool sales exceed $18 million.

Satkiewicz already is thinking about next year.

September 2002 “It’s great to be done, and it’s the best SmartWool moves into 12,000 square feet of ride we’ve ever had,” Satkiewicz said. office space at the Steamboat Springs Airport ter“Biggest group, best riders, inspirational people.” minal building.

The group will meet again in two days for the real reason they rode January 2003 here — the Outdoor Retailer show The Dukes lose majority control of the company and in Salt Lake City. sell their remaining interest to RAF Industries. Chip “Now, it’s way back to busiCoe becomes president. ness,” Satkiewicz said.

December 2005

Timberland pays $82 million for SmartWool, which is doing just more than $40 million a year in sales.

June 2006

President Chip Coe hires Mark Satkiewicz as vice president of sales.

October 2006

SmartWool President Chip Coe retires from the company.

Mark Bryden, vice president of operations, named interim president.

Breaking records SmartWool arrives at the trade show even bigger and stronger than it was a year ago, despite the recession.

That has been a trend since the company was founded in Steamboat in 1994 by former ski instructors Peter and Patty Duke.

February 2007

Mark Bryden is named SmartWool’s president.

August 2007

SmartWool employees take inaugural bike ride to Outdoor Retailer trade show in Salt Lake City.

February 2008

Founders Peter and Patty Duke launch Point6 sock company, a month after their noncompete agreement with SmartWool expires.

April 2008

SmartWool commits to purchasing energy credits through Native Energy to support Colorado wind farms — enough credits to offset 1.3 million miles of airline travel annually, 296,000 miles of automobile commuting logged by SmartWool employees and the electricity and natural gas consumed by SmartWool’s offices in Steamboat and Boulder.

November 2008

SmartWool is named Sustainable Business of the Year by the Steamboat Springs Chamber Resort Association. The company helped establish the program’s highest designation, platinum.

July 2009

SmartWool President Mark Bryden promoted to vice president and general manager of Timberland North America. Mark Satkiewicz named SmartWool president.

2009

SmartWool has another record-breaking year with revenues nearing the $100 million mark, selling more than 10 million pairs of socks in addition to other apparel.

SmartWool’s community involvement this year included its second Bike-in Movie at Howelsen Hill. The company hosted the event as a thank you to the community.

Timberland CEO Jeff Swartz, right, visits with SmartWool specialty sales manager Carol Momoda.

Budget projections were met in 2008 after the economy bottomed out in October of that year.

They fell short of their projections in 2009, but it was another record-breaking year with revenues nearing the $100 million mark. SmartWool sold more than 10 million pairs of socks in addition to its growing apparel line. More important, it outpaced its competitors in terms of growth. Today, SmartWool has about 85 employees, with 20 working out of offices in Boulder and London.

Sat­kie­wicz expects to have another recordbreaking year in 2010, and that doesn’t necessarily mean taking market share from its main merino competitors Icebreaker, Ibex and I/O Bio. “The synthetic people at the premium end, I think they have the most market share potentially to lose because they are very expensive, and the properties of merino wool are proven to be stronger,” Satkiewicz said.

Socks are SmartWool’s stronghold. The company holds a 70 percent market share in the specialty sock market, according to communications director Molly Cuffe. At least nine of the 10 best-selling socks every month are made

by SmartWool.

The company accounts for about 7 percent of New Hampshire-based Timberland’s annual revenues, Satkiewicz said. The publicly traded Timberland brought in $1.29 billion in 2009. The company made $56.6 million after paying taxes and the salaries of 5,700 employees.

There have been two changes in ownership in SmartWool’s history. The first came in January 2003, after the Dukes lost majority control of the company and sold their remaining interest to RAF Industries.

“It’s like losing your baby,” Peter Duke said at Outdoor Retailer, where he was promoting his newest sock company, Steamboat Springs-based Point6.

The second ownership change was in December 2005, when Timberland paid $82 million for SmartWool, which at the time had revenues of more than $40 million, Satkiewicz said.

In 2002, SmartWool moved its headquarters into the Steamboat Springs Airport terminal building.

Timberland did not bring an influx of cash Community pride like RAF, but SmartWool benefited in being Live in Steamboat Springs long enough and able to use some of Timberland’s other assets, your sock drawer will look like Sandy Evans such as human relations, inventory, finance and Hall’s.

IT support. SmartWool employees also benefit“I’ve got the stripes, I’ve got the snowflake ed from Timberland’s benefits program, which design, I’ve got the long ones, really thin ones includes performance-based bonuses. that I need for skiing, I’ve got the really thick There was fear that a new owner hiking ones — blue and green — might want to relocate SmartWool They don’t have to and then I have probably eight from its home in Steamboat, at the or nine pairs of running socks, be involved in our city’s airport terminal on Elk River everything from bright pink to local events. They Road. That has not happened, bright yellow to gray,” said Evans and there are no plans to do so, certainly have bigger Hall, a longtime Steamboat Satkiewicz said. fish to fry with their resident who has worked at the Swartz said that even during a Steamboat Springs Chamber national and internavisit of SmartWool headquarters Resort Association since 1985. tional distribution, to consider purchasing the compa“I think there is a tremendous ny, SmartWool’s greatest asset was but they always take amount of community pride kept a secret. a look at things that we have that business here in “If you buy the company, we’ll town,” Evans Hall said. we’re doing, and tell you the secret,” Swartz said SmartWool is a sponsor of they want to be he was told. After the purchase, numerous community events. The “Mark and others said, ‘Here’s the active and they short list includes the Steamboat secret: We live in the most specwant to be a part of Marathon, Steamboat Triathlon tacular place in the world.’” the community. and Ride 4 Yellow Livestrong Timberland was looking to events. acquire a portfolio of brands, On Aug. 15, SmartWool held Sandy Evans Hall and the purchase of SmartWool Longtime Steamboat its second annual Bike-in Movie proved to be the smartest finanSprings resident at Howelsen Hill, where “The 40 cially as well as in terms of Year Old Virgin” was shown outwhat SmartWool could offer side on a big screen with thousands Timberland, Satkiewicz said. of dollars raised from beer sales and donations “Active mountain lifestyle people are frank for the Routt County Riders cycling advocacy and they’re direct and they’re candid and they’re group. honest and they’re confident and they’re self“They don’t have to be involved in our local confident but not full of themselves,” Swartz events,” Evans Hall said. “They certainly have said while visiting the SmartWool booth at the bigger fish to fry with their national and internaOutdoor Retailer show. “They’re understated tional distribution, but they always take a look but purposeful. That impacts a corporate culat things we’re doing, and they want to be active ture in a big way. Timberland is ... a more powand they want to be a part of the community.” erful place as the mountain air moves through our halls. Our culture is much stronger with this SmartWool is joined by other Steamboatassociation.” based outdoor businesses — think Moots

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SmartWool sales representative and ride participant Rion Smith meets with a customer at Outdoor Retailer.

Chip Coe, who was president of the company at the time, said buyers were paying a premium price for companies such as SmartWool.

“We had a discussion that said, ‘We’re not really super interested to sell, but if someone is willing to pay this price, we’re willing to listen,’” said Coe, now 50 and working for Wolverine World Wide, the owner of several footwear companies. “We never did hang a ‘for sale’ sign on the company, so to speak.”

Coe said SmartWool approached about a dozen pre-qualified companies to gauge interest. Executives met with four of those, and Timberland made the right offer.

Since the Timberland acquisition, SmartWool has more than doubled its revenues. SmartWool’s revenue and profits are not specified in Timber­ land’s quarterly filings.

Satkiewicz and Timberland CEO Jeff Swartz say the acquisition has benefited both companies.

SmartWool operates within its own budget, and its parent company so far has taken a hands-off approach.

“They put pressure on us like any owner or parent company would, but that’s to be expected,” Satkiewicz said.

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Cycles, Eriksen Cyles, Big Agnes, BAP and Honey Stinger — that Steamboat hangs it hat on, said Evans Hall, the Chamber’s executive vice president.

“We really like those business being here because they kind of walk the style that we are,” she said.

Companies such as SmartWool also help diversify a Steamboat economy that relies heavily on tourist dollars, Routt County Economic Development Cooperative Director Scott Ford said.

“SmartWool is good for the Yampa Valley, and Steamboat is good for them, too,” he said.

Ford said SmartWool offers careers, not just jobs, to a resort community that often has plenty of the latter but not nearly enough of the former.

“What it means is places like SmartWool, as these businesses become more dynamic there are increasing career opportunities,” Ford said. “There is a time when we didn’t see that, and now we do, and SmartWool offers that.”

SmartWool is born During this year’s summer Outdoor Retailer show, Peter and Patty Duke find themselves in a familiar position.

This is the show where 16 years ago the SmartWool founders first showed potential buyers their socks made from merino wool, a textile that in the coming years would explode in the marketplace, stealing business from synthetics.

Like many Steamboat Springs residents, Sandy Evans Hall has collected a drawer full of SmartWool socks. It’s the only kind of sock that she and her husband wear.

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Steamboat Pilot & Today • SmartWool’s Ride • Part 2• Saturday, September 11, 2010

Rebuilding a brand

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activities and lifestyles.

The Dukes consider quality their competitive advantage, with their products typically costing the consumer a few more dollars. The socks are made using 100 percent compactspun yarn.

“Everything that we are doing is a more expensive method ... but what always in my mind prevails is quality,” he said. “The more you can put in for quality, eventually the consumer will gravitate to that, and that’s what our research is saying to us.”

With 10 employees, four of whom used to work at SmartWool, Peter Duke said Point6 sales are surpassing those of SmartWool in its early years, which he attributes to their experience, knowledge and ability to invest more in the company early on with proceeds from the sale of SmartWool.

SmartWool founders Peter and Patty Duke were bought out in January 2003 and have since started the Point6 sock company.

Point6 has set up a distribution center in Canada and wants to expand into Europe.

Shipping to the First Ascent stores will The socks are for sale in Steamboat at begin in September.

Allen’s and Zirkel Trading. More retailers are “The REIs will come, the L.L. Beans will coming on board, Peter Duke said. come as soon as they recognize that it’s time to The company also has established a relation- make the move,” Peter Duke said. ship with Eddie Bauer, specifically 183 of the The passion from the Dukes is apparent as First Ascent mountain outerwear stores located they go up against the merino wool giants of During inside some Eddie Bauer stories. The socks will Icebreaker and SmartWool, a company the that first have both the First Ascent and Point6 logos.

Dukes considered their baby. Today, Peter show, SmartWool’s “That is a wonderful feather in our cap of booth was outside in a Duke looks at their baby as a “spoiled brat” or tent with the rest of the startup having a company of that magnitude “misguided child.” companies. believing in who we are,” “I say that in jest and in fun,” Peter Duke “We were a new vendor, and you Peter Duke said. said.

“The child has really grown and really don’t get on the main showroom basement of the floor,” said Peter Duke, 64. done a marvelous job. I don’t want to say their Dukes’ house. Their In recent years, those new vendors product is not quality. I just truly believe that warehouse was a 13th Street have been moved inside to a ballroom we have a better product.” storage unit. a few hundred yards from the main “My wife and I would get an order, floor of the Salt Palace Convention The name Point6 was derived from the natural 98.6-degree we’d enter it, we’d run out to the cold Center. That’s where the Dukes find body temperature of humans. Peter Duke said merino wool to RAF.” storage, ship it and then invoice it,” themselves this year with Point6. naturally maintains that body temperature.

Peter Duke remembers During this year’s show, Peter Duke Peter Duke said. the breakup differently.

SmartWool was battling synthetics recalled a key moment in SmartWool’s “It was growing through the roof,” history. He was doing his sales pitch to and winning, but the Dukes needed he said. “It was a rocketship, and help. a potential buyer at the show. something made them want the whole SmartWool’s, Tim “He says, ‘You know something, Reinhart mans a station thing, and that’s why we were no SmartWool grows up the guy next door, the other sock guy, longer there. There was a lot of unfin- where people use pedaling power from is saying the same thing about his a stationary bike to mix fruit smoothIn 1995, a year after SmartWool ished business for my wife and myself product as you are saying about your ies. Hansen meets with retailers about Duke at a gas station. was launched, the Dukes partnered — unfinished business in what we product.’” recent changes to SmartWool’s com“Come talk to me sometime,” Peter with Philadelphia-based investment wanted to bring to the market.”

Peter Duke realized he had to get puter systems.

Inside the company’s Duke told Flanigan. “My company is group RAF Industries, which looked Coe said he was not privy to the his socks on potential buyers’ feet, so booth at a table across from a map growing.” at the emerging brand and decided to buyout agreement. he launched a giveaway prodetailing SmartWool’s ride to the Without Flanigan having any invest.

“It was a willing buyer and seller, gram. show, sales rep Carri Wullner shows education or experience in market“We needed some and they agreed on whatever price For the next “I said, ‘Here, put the spring 2011 sock line to Natalie ing, Peter Duke took a chance and money, and it was they agreed on and closed the deal and them on your feet, I two, three years Freel and Sue Selleck with Roth’s hired him as marketing coordinator in important that they moved on,” Coe said. “I know enough won’t talk anymore, put Shoes in Casper, Wyo. Wullner also October 1997. helped us with the financ- to know that they got paid handafterwards, the them on your feet,’” tells them about the four-day ride.

“I feel a great deal of indebtedness locals kept coming ing so we could get to the somely.”

Duke recalled.

“I’m darn impressed,” Selleck said. to them,” said Flanigan, 49. “I just next level,” Peter Duke In the three years leading up to the up to us and “By the end of that SmartWool field marketing manfeel really fortunate to have been able said. buyout, SmartWool had grown from show, people were actually starting ager Gardner Flanigan has met the to learn this industry and work for Officials at RAF did 12 to 32 employees despite no further coming by and sayriders at the show. something that I really, really believe not reply to a request for what we call the infusions of capital since the initial ing this is absolutely He has been at the company since in and am able to live in Steamboat an interview, but a section investment by RAF. SmartWool salute, the greatest product 1997, longer than anyone currently Springs.

The ride’s been good. It is a on their website singles out Duke declined to discuss details of where people they’ve ever had on working there.

Flanigan knew the ride.

There’s ups and downs and all SmartWool as a company the buyout, saying only that he and his their feet, and so startwould pick up their Dukes through the Steamboat Springs that.

We’ve had transitions and chalsuccess story. wife didn’t come out of it “as well as ed SmartWool.”

Winter Sports Club, where, as a coach, lenges as a company, but at the end of According to RAF’s leg and say, ‘Are we should of.”

The former ski Flanigan taught the Dukes’ children the day, it’s the culture, it’s the people version, SmartWool Peter Duke said they never wanted you making these instructors were introhow to ski.

In between jobs during and ultimately it’s this great product had sales of about to get out of the business and always socks again?’ My duced to merino wool summer 1997, Flanigan ran into Peter that we make that really works.” $300,000 the first year had the idea of getting back in. wife and I said, in 1987, a product with in 1994. The next “We just didn’t know ... how, where technical qualities such year, RAF invested, ‘Maybe we’re and when yet,” he said. as temperature regulapumping six figures getting to the point While the Dukes tried to embrace tion and moisture wickinto SmartWool and retirement, the company they founded where the market ing. netting a 30 percent continued to grow without them. place is right,’ so in stake in ownership.

There also was a new process of treating It would invest more ’94, we launched Room for growth the wool that made it money later that SmartWool.

Walls lined with SmartWool socks itch-free and dryeryear. It also loaned can be found at the smallest and largfriendly.

SmartWool money, Peter Duke est outdoor retailers in 28 countries.

“Good news was which gave RAF the Founder of SmartWool Scarfs, hats, sweaters, jackets, that people loved the option to acquire gloves, cycling and running apparel product,” Peter Duke additional stock for an have continued to gain prominence at said. “Bad news was that agreed-upon price and the option retailers ever since SmartWool entered it wasn’t right for the marketplace to become the majority shareholder, the apparel market in 1999 with its because it was expensive.” said Coe, a lawyer who provided They opened Duke Designs in 1988 legal services to the Dukes during the merino wool base layer.

You might be surprised by where in the Franklin Mall in downtown launch of SmartWool and would later else you will find the SmartWool logo Steamboat, selling merino wool and become company president. today.

The company has an expanding traditional wool socks, hats and sweat“I don’t think they frankly set out line of slippers and recently partnered ers. They pitched the merino wool to take control,” Coe said in an Aug. with Vibram to create a co-branded, product at trade shows.

23 telephone interview. “It was only five-toed exercise and running shoe.

“They enjoyed the product, but it later on that they started to ramp up SmartWool liners also can be found in took too much energy from a retailer’s that things got more interesting for some Timberland footwear products. point of view to explain to the cuseveryone.”

Three different thicknesses of base tomer the attributes of the product, With the infusion of cash, layers, mid-layers and jackets helped so they were reluctant to bring it to SmartWool sales exceeded $2 million drive SmartWool’s layering message market. Plus it was expensive,” Peter in 1996, according to RAF. The next during this year’s Outdoor Retailer.

Duke said. year, sales nearly tripled to $5.7 milThere is an ongoing effort to get peoFurther market research for the lion. At that point, SmartWool had ple who are familiar with the brand to Dukes included selling merino wool expanded its product line to include try different products, Satkiewicz said. socks to Steamboat locals for $5 a running, biking and casual socks.

While SmartWool continues to pair.

SmartWool socks began appearing in innovate and expand its product lines, “We had a couple of thousand pair, the L.L. Bean catalogue and its flagthe company also has taken steps to and when we ran out, we ran out,” ship store in New England. expand its stake in international marPeter Duke said.

From 1998 to 2000, SmartWool kets, which accounts for only 15 perThe Dukes had stopped making grew its employee base and hired mancent of sales. the merino socks, closed the storefront agers experienced in the industry.

“We see that changing pretty sigin 1992 and waited for markets to Coe sold his practice and became nificantly,” Satkiewicz said. “There is change. chief operating officer for the growing significant opportunity really every“For the next two, three years after- company. Peter Duke remained the preswhere we look.” wards, the locals kept coming up to ident, and Patty was creative director. us and actually starting what we call In 2000, a year after Coe joined Taking a chance the SmartWool salute, where people the company and helped introduce would pick up their leg and say, ‘Are On opening day of Outdoor SmartWool base layers to the market, you making these socks again?’”

Retailer, those who have just ridden revenues exceeded $18 million.

Peter Duke said. “My wife and I said, In January 2003, according to RAF, 360 miles on their bikes across parts ‘Maybe we’re getting to the point of Colorado and Utah are dressed “the Dukes realized their goal of where the marketplace is right,’ so in financial security and the opportunity in typical outdoor industry business ’94, we launched SmartWool.” casual. to pursue new challenges by selling SmartWool Field Marketing Manager Gardner Flanigan asks for the audience’s help in choosAt the Timberland booth next to their remaining interest in SmartWool World headquarters was in the ing the best cruiser bike during SmartWool’s second annual Bike-in Movie on Aug. 15 at Howelsen Hill. eter and Patty Duke hope the reception SmartWool received in the marketplace is similar with Point6, the new company they started in February 2008, a month after their five-year noncompete agreement with SmartWool expired.

This month marks the one-year anniversary of their first shipment.

At the Outdoor Retailer show, Peter Duke sees many of his old customers and competitors, some of whom are friends, such as John Fernsell, president of Ibex Outdoor Clothing.

Fernsell: “So, I hear you’re doing well.”

Duke: “It’s getting there. It’s a slow process coming back. It’s a battle.”

Fernsell: “I don’t know what the freak you were thinking about coming back. I always thought you had it made, but ... it’s obviously greener somewhere else.”

This time around will be different for the Dukes.

“I will maintain control of the company,” Peter Duke said.

Point6 now has what owners consider a complete line of socks in a variety of colors designed around

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