Opinions expressed by Entrepreneur contributors are their own.
Fresh Prints is a thriving business that began with a very bad decision. “We bought the company pretty blind,” says Jacob Goodman. This was 10 years ago, when Goodman and his fraternity brother Josh Arbit were students at Washington University in St. Louis. At the time, Fresh Prints was a failing clothing company that sold fraternity, sorority, and college-branded merch, started by a few other students. The two friends bought it for $16,000, paying with Arbit’s bar mitzvah money. They figured it would be an education. They were right.
“We didn’t know what due diligence was. And we were like, ‘Oh, are we going to have to shut this thing down right away?'” Goodman says. That’s because, within a month, they were scammed by a customer for $8,000 and owed $25,000 for licensing royalties that hadn’t been reported by the founders. But once they solved that, they started innovating — and today, Fresh Prints has 290 full-time employees and annual recurring revenue of $40 million. Here’s how they did it.
Related: How to Create a Growth Mindset as an Entrepreneur
Step 1: Fix the foundation.
The guys had already spent the bar mitzvah money, and they were now facing back payments and losses. “So we had another bar mitzvah!” Arbit jokes. Seriously, what they did was tell their vendors (printers, wholesalers, FedEx) that they had a temporary cash flow problem, and they asked for a 30- or 60-day extension to pay. Most said yes; it was a lesson in having honest conversations. Then they secured licenses from the universities, fraternities, and sororities whose marks they wanted to print on their apparel — creating a real foundation to build from.
Step 2: Build a sales force.
Their target customers were students, so they figured their sales force should be, too. At first, they just roped in their friends at other colleges and trained them on a video meet with a Google doc of instructions. “But we needed to figure out how to scale this,” says Jolijt Tamanaha, who came on as the third co-owner in 2015. They created recruiting channels, like cold outreach on LinkedIn and referral campaigns, and developed a three-week training program with a dedicated internal team (now 13 people) to provide ongoing support.
Related: 4 Ways to Know When It’s Time to Rebrand Your Business
Step 3: Separate from the competition.
Custom apparel is an old and crowded industry, but Fresh Prints spotted an upside: “Basically, everyone in our space is buying from the same five wholesale distributors that carry styles released like 10 years ago,” says Tamanaha, “and it gives these garments a budget throwaway vibe.” So in 2019, they zeroed in on trendy graphics. Then in 2021, they launched their own high quality clothing line with a sweat set (matching sweatshirt and sweatpants), which was all the rage on campus and drove more than $1 million in sales the first year.
Step 4: Redefine the company.
“We’ve really leaned into making the transition from a custom apparel company to a fashion company,” says Goodman. Meanwhile, they’re venturing off campus into corporate America with clients like Google, Amazon, and Uber for a whole new revenue stream: “swag management” — mugs, water bottles, sweatshirts, journals, and other merch customized with company logos for, say, an annual retreat or holiday gifts.
Related: 6 Proven Strategies to Rebound From Failure
Step 5: Never forget the basics.
As Fresh Prints grows, it still stays close to students; in fact, it now has 625 campus managers driving sales. “The biggest thing we teach them is how many times they’re going to have to get rejected and fall on their face in order to make it,” says Goodman. “There’s no class in college called Perseverance 101.”