Author Topic: Who is Jimmy Styks? Answered.....  (Read 7974 times)

TallDude

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Who is Jimmy Styks? Answered.....
« on: October 21, 2018, 10:27:28 AM »
Pono asked, "who is Jimmy Styks"? It was a couple of California dudes Kyle Reeves and Jeremy Wilkens with totally big ideas....... and bigger problems. " Dude! We are going to totally like.. make boukoo bucks on these stickers. We just order like ... $60K worth of stickers (through Vista Outdoor whom they are exec's with) and mark them up to like $4 mil.... dude.. and get a 10 million dollar bonus! From Vista.".... NOT! 
This is now:
https://www.forbes.com/sites/danielfisher/2017/02/17/nice-try-judge-rejects-attempt-to-turn-4-million-sticker-purchase-into-10-million-bonus/#6bc53a627ea4


And this was then:
https://www.ocbj.com/news/2015/jul/24/40m-hb-paddle-board-brand/

It's interesting that SUP is / was just an 'emerging platform' to the business world. It now seem that foiling is more literally an 'emerging platform' ::)

« Last Edit: October 21, 2018, 11:08:53 AM by TallDude »
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805StandUp

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Re: Who is Jimmy Styks? Answered.....
« Reply #1 on: October 21, 2018, 11:56:36 AM »
Pono asked, "who is Jimmy Styks"? It was a couple of California dudes Kyle Reeves and Jeremy Wilkens with totally big ideas....... and bigger problems. " Dude! We are going to totally like.. make boukoo bucks on these stickers. We just order like ... $60K worth of stickers (through Vista Outdoor whom they are exec's with) and mark them up to like $4 mil.... dude.. and get a 10 million dollar bonus! From Vista.".... NOT! 
This is now:
https://www.forbes.com/sites/danielfisher/2017/02/17/nice-try-judge-rejects-attempt-to-turn-4-million-sticker-purchase-into-10-million-bonus/#6bc53a627ea4


And this was then:
https://www.ocbj.com/news/2015/jul/24/40m-hb-paddle-board-brand/

It's interesting that SUP is / was just an 'emerging platform' to the business world. It now seem that foiling is more literally an 'emerging platform' ::)

Holy smokes... Vista paid them $40M or 5xEBITDA in 2015 for their paddleboard business... sounds like without the earnings payout these guys laughed all the way to the bank given the declining SUP market.

805StandUp

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Re: Who is Jimmy Styks? Answered.....
« Reply #2 on: October 21, 2018, 12:01:29 PM »

Holy smokes... Vista paid them $40M or 5xEBITDA in 2015 for their paddleboard business... sounds like without the earnings payout these guys laughed all the way to the bank given the declining SUP market.

But... it looks like in the summary judgement, Vista was able to keep the $4M...

https://litigation.consusgroup.com/2017/02/14/vista-outdoor-inc-vsto-v-reeves-family-trust/

Bean

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Re: Who is Jimmy Styks? Answered.....
« Reply #3 on: October 21, 2018, 12:33:45 PM »
Crazy and interesting stuff for sure.

But, I think that I speak for most Zoners when I say, thanks for not posing this in the HOT Chicks thread! ;D

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Re: Who is Jimmy Styks? Answered.....
« Reply #4 on: October 21, 2018, 02:32:14 PM »
For the record...Kyle is a Canadian...not Californian...

This question was hashed out here before in gory detail...;-)

https://www.standupzone.com/forum/index.php/topic,6683.0.html
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TallDude

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Re: Who is Jimmy Styks? Answered.. Then and Now.
« Reply #5 on: October 21, 2018, 02:45:13 PM »
I should have titled it 'Look what happened to Jimmy Styks.' The old thread doesn't cover the current state of the company. 
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eastbound

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Re: Who is Jimmy Styks? Answered.....
« Reply #6 on: October 22, 2018, 06:00:30 AM »
new news to me--interesting

big wonder is did Reeves and Wilkins get any of the alleged $40mm paid for the "jimmy Stinks" company?

if they pocketed that money or any part thereof, they hustled  a bunch of dumb corporate money very effectively. the sticker deal might have been an enhancement of an already great con job, or it may be that the "sale" for "$40mm", meant there was a contract in place for $40mm worth of earnouts and other payment trigger thresholds??

who knows?--but if these guys got any significant cash out of this deal, they played the Vista violin quite masterfully---enviably in fact.

seems unlikely, tho, given the dumbness required to email about the obvious earnout scam, and the language of the emails say dumb too....



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PonoBill

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Re: Who is Jimmy Styks? Answered.....
« Reply #7 on: October 22, 2018, 06:57:48 AM »
The article isn't completely clear, but it does indeed appear the $40 million was an earnout based on five million in sales (8X) which means Jimmy Styx was on a better earnings rate than I would have expected when they sold it. The sticker scam is a standard earnout ploy most acquirers look for--inflate earnings during the period, usually by channel-stuffing. I ordered one $5000 load balancer back when companies built their own site hosting and four were delivered. When I called the company they said "just keep them". As doorstops?

Bullshit makes the world go round. But my interest in this particular case was only centered around naked and scantily clothed young ladies, and a completely puzzling scenario.
Foote 10'4X34", SIC 17.5 V1 hollow and an EPS one in Hood River. Foote 9'0" x 31", L41 8'8", 18' Speedboard, etc. etc.

digger71

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Re: Who is Jimmy Styks? Answered.....
« Reply #8 on: October 22, 2018, 09:22:46 AM »
Crazy stuff!  After reading everything it seems to me:

They got $40MM in cash in 2015
Not sure of the multiple because I don't see where 2015 EBITDA is listed
True 2016 EBITDA was ~$8.4MM.  Their bogus $4MM sticker deal would have pushed it over $12.4MM
If they had hit earnings targets they could have earned an additional $40MM - effectively increasing the selling price.

These 2 guys appear to be a couple of dumbasses, but rich dumbasses who got out at the right time

TallDude

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Re: Who is Jimmy Styks? Answered.....
« Reply #9 on: October 22, 2018, 10:46:23 AM »
But my interest in this particular case was only centered around naked and scantily clothed young ladies, and a completely puzzling scenario.
I think it's a classic Pono and the three bears story. This one doesn't drink. This one drinks too much.... Butt, this one knows how to party!  ;)
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Weasels wake

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Re: Who is Jimmy Styks? Answered.....
« Reply #10 on: October 22, 2018, 12:28:47 PM »
It's a great "caption this" photo.
It takes a quiver to do that.

surfcowboy

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Re: Who is Jimmy Styks? Answered.....
« Reply #11 on: October 22, 2018, 08:36:00 PM »
$40MM for a SUP company.

Ron House, Daum, the Boehne family, Laird, think about all the folks who invented this thing and these guys walk with more cash than all of them combined. There’s a lesson in there folks. Learn it.

If someone makes you an offer, take it. You can build another company, no matter what it is. But exiting while you still have value is a skill that few master.

There’s another lesson about scale and selling beyond a limited market in here as well. But it’ll be lost in all the comments about “core” and “soul” and other words people use to make up for the fact that they are cool but broke.

I’ve ruined a few careers over those sorts of romantic things. That’s why I won’t go into a business I’m too attached to anymore. You cannot make good (hard) decisions about them. These guys were willing to be hated in the industry and walked away with a ton of cash by just being willing to be seen as uncool for a couple of years, and flooding craigslist and big box stores. Now anyone who thought they were uncool is out of business or irrelevant and they are counting their money somewhere warm, surfing handmade customs they purchased from the same folks who hated them.

Well played. Well played indeed.


PonoBill

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Re: Who is Jimmy Styks? Answered.....
« Reply #12 on: October 23, 2018, 06:04:51 AM »
That's all true, Cowboy. I doubt they planned to be acquired, they were just taking advantage of a new market in the simplest, quickest way. People doing something for love aim for themselves and reach the enthusiasts who want the best. Those just jumping in to take advantage look for the biggest market. It's no surprise to me that they made a lot more money. I'm just surprised they got acquired for any significant multiple. Being the knockoff sleazebag isn't a sure road to success, there were lots of folks doing that, and most are back living with their parents. But aiming for yourself is a certain road to smallville.

In the general SUP market during the boom, Jimmy Lewis had the best model. If Vista was smart they'd have acquired him and taken him to the low-end mass market with a high-end lever. But the silly party is over, and now it's grind time. That's Starboard, Naish, and a few others.

The Stykers were pretty goofy, there are much better ways to stuff a channel if you have control. They could have had their earnout if they'd been just a little less sleazy and little more smart.
« Last Edit: October 23, 2018, 06:06:58 AM by PonoBill »
Foote 10'4X34", SIC 17.5 V1 hollow and an EPS one in Hood River. Foote 9'0" x 31", L41 8'8", 18' Speedboard, etc. etc.

surfcowboy

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Re: Who is Jimmy Styks? Answered.....
« Reply #13 on: October 24, 2018, 01:31:00 AM »
Pono, agree. I don’t love their strategy or style of course.

You’re likely right about JL as well. My point was more about how much brands hate to walk both lines as far as down market and up.

Lots of companies have both, Toyota and Lexus for example. JL and many others really missed the opp to cover their butts on this.

I own an inflatable that’s not similar, it’s exactly the same as the cheap brands. It tried to retail for $1299 and failed while others sold the same thing for half. (Bought mine from a rep as a demo.)

These goofballs could have been replaced by any of the good folks we all know but they ignored the growth segment of the market.

But as we see, you can even mess up a deal (at the right time) and still make a ton of money. But yeah, I’d rather see anyone else take Vista’s money. I guess sanding foam and covering it with fiberglass doesn’t prepare you to deal with bankers necessarily. ;)

PonoBill

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Re: Who is Jimmy Styks? Answered.....
« Reply #14 on: October 24, 2018, 05:15:23 AM »
Sadly, no. I've tried to advise folks about covering market segments when they have an early mover advantage. Craftsmen get huffy about selling their designs cheap, but if they don't, there's a Jimmy Styx who will. The market plan for Ke Nalu was to cover the market from below entry level to top, with components that could be combined and upgraded across all price points. I planned to provide private label paddles for brands. I never executed that plan, so it goes. Part of the reason was I liked and respected the competition, I was fucking around, they were making a living for their families.

Companies like Vista buy momentum and a story. Big corporations get as dumb as they seem about specifics but smart about the general approach to marketing a product.

I'm watching the foil business now. The only saving grace might be that's it too small and too difficult to attract the wolves.
Foote 10'4X34", SIC 17.5 V1 hollow and an EPS one in Hood River. Foote 9'0" x 31", L41 8'8", 18' Speedboard, etc. etc.

 


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