As Volcom prepares to celebrate its 20th anniversary, the
brand’s story—and that of its Co-founder and CEO Richard
Woolcott—has gone largely untold. In this rare look inside
the Volcom Stone, Woolcott speaks candidly about his life, his
approach to business, and his strategic outlook on operating
in a post-recession environment.
“THEY PUT TWO PINS IN MY HEAD
and bolted me to the wall so I wouldn’t move,” Richard Woolcott, 45, narrates his
uncanny path to success as he leans over a small, nondescript table in his corner
office. The table is littered with old photographs, books, and tactile mementos—
each with its own geological contribution to the bedrock of Woolcott’s first-born
brainchild, the Volcom Stone. “Once they took the X-rays they couldn’t believe I
was alive; I had a hangman’s break.”
The implications of the injury’s moniker are obvious, but Woolcott’s scenario
was anything but ordinary. His story could play out as easily on the big screen as
in the pages of a hardback best seller, but “Wooly” (as he’s often referenced by
friends and colleagues) tells it humbly, almost reluctantly.
At around 3 o’clock on April 3, 1985, while surfing on a remote island off the
coast of Baja, Woolcott slammed headfirst into a shallow sandbar. The impact
snapped both his C1 and C2 vertebrae in two places, caused a fifth break in his
C3, and fractured his C4. More than 24 hours later—after sleeping on a makeshift
stretcher with wads of T-shirts supporting his neck, flying to Ensenada in what
he describes as a 1942 German war plane, and riding across the U.S. border in the
back of an open pickup truck—doctors finally had a chance to examine what he
had self-diagnosed as a bad sprain.
“They said there was a 2 percent chance that somebody could live through a
break like that,” he adds. The doctors told Woolcott that his well-developed neck
and back muscles were his saving grace. Had he not been an avid surfer, that type
of damage to the cervical column of his spine would have turned his neck into a
slinky, paralyzing his diaphragm, thus stopping his breathing.
A promising amateur surfer at the time, Woolcott had a substantial points lead
in the National Scholastic Surfing Association’s (NSSA) Men’s title race. Fueled by
a second-place finish at Nationals and a third-place result at the World Contest as
How a broken neck, a Budweiser commercial, and a trip to Tahoe inspired one of
the world’s most progressive lifestyle apparel brands!
BY JOSH HUNTER
PHOTOGRAPHY BY GARY COPELAND
“I THINK A LOT OF PEOPLE
HAVE THOSE KINDS OF
THAT POINT YOU IN A
have temporarily shrouded his perception of just how lucky he was to survive
the incident, much less make an eventual full recovery.
“It was devastating to be working so hard for four or five years on a goal and
then have it taken away,” he recalls. It’s not the first time he’s told the story, but
his mannerisms suggest it’s been a while. “It took a long time to recover—six
months…I basically missed my window competitively. Everything changed.”
Raptly devoted to realizing his ambitions, dreams of a professional surfing
career had been mortally wounded. While his life had been spared, his athletic
aspirations were not. Long months of protracted rehab provided plenty of opportunity
for introspection, something Woolcott remembers as a critical point in finding his direction in life. “I went through all sorts of emotional stuff. By the time I got home [from the hospital] it all sank in,” he says. His face implies this part of the story is often omitted. “I remember I had this one picture of Tom Curren in my bedroom.
I’d look at that photo every day and think: ‘I am going to do that again. I’m going to surf.’ “That was a gnarly time. I look back at it now, and if that didn’t happen, I would’ve gone on the tour for ten years. So it took something like that to change my life direction.” He pauses. “I don’t look back. I’m not mad about it; I’m just thankful I’m still walking. But I think a lot of people have those kinds of moments.
Moments that point you in a completely different direction.”
It was 1986 before he fully recovered and, at the behest of his father, Rene Woolcott, a Harvard MBA-wielding Wall Street financier, Richard had agreed not to abandon his education in pursuit of surfing. He began balancing business classes with a part-time surf coach position at his longtime clothing sponsor, Quiksilver, which had recently filed its initial public offering. It was the heyday of neon, and Quiksilver’s Echo Beach campaign began spiraling up and out of the cheap-rent district of Costa Mesa, California’s “Velcro Valley” into both the international fashion scene and quarterly revenue reports on Wall Street. Woolcott began to realize the full potential of the burgeoning action sports market, and in order to further develop his business acumen, he transferred from San Diego State University to Pepperdine. “That’s when I really started to see the end goal of getting a business degree. I was set on it; I was going to coach, finish school, and go to work,” he explains emphatically. “I decided I was going to get in there, roll up my sleeves,
and start my career.” Shortly after graduation Woolcott went to work full time in Quiksilver’s
marketing department. His two-year tenure at the company began in ’89, an era that would prove to be unique for the surf industry. Among his other duties as promotions manager, Woolcott took an interest in filmmaking. His first project was called Gen X, and he would go on to work with a young, up-and-coming surfer named Kelly
Slater and videographer John Freeman on a film titled In Black And White. Today, Slater’s debut film (released in ’91) remains highly regarded as one of the most revolutionary surf films off all time. “I wanted to be more creative, and that creativity was fueling my fire,” explains Woolcott. As Quiksilver adapted to its newfound status on the New York Stock Exchange, the culture within the company matured at an accelerated pace.Surfers-turned-executives were determined to prove to Wall Street thatthe cottage industry had evolved beyond the stoner stereotype perpetuated, in part, by Sean Penn’s infamous Jeff Spicoli character in Fast Times At Ridgemont High. During this period, Woolcott says it was commonplace to see pleated khaki pants, oxford shirts, and Top-Sider shoes around the company’s now officially corporate office. “We all had our briefcases, and we were these young businessmen playing the part. It was still a fresh public company, and we were on a mission.” The memory brings a
smile to his face; it was around this time that the Quiksilver marketing crew began dolling out nicknames for each other. Woolcott’s was Malcolm— as in Malcolm Forbes. “Actually, that’s right about the time the recession hit,” he adds. On October 19, 1987, the stock market collapsed, dropping more than 22%, immortalizing the day as “Black Monday.” The Savings And Loan Crisis was soon to follow. Although the market recovered briefly, by 1990 it was clear that the recovery was illusory. With the economic environment as the executioner, neon died faster than disco had a decade earlier. “It [early ’90s] was one of the darkest times for the industry in my recollection,” explains Tom Knapp, a former Surf Industry Manufacturers Association (SIMA) president,
who currently teaches a course on entrepreneurship at the University of Southern California. “Between ’90
and ’92 was a really sketchy time.” Quiksilver’s stock price dropped from $2.46 per share in the spring of
1990 to $0.98 a year later, and neon’s death had sent every established designer in the industry back to their
drawing boards in hopes of finding the next big trend. “It was a very conservative time,” Woolcott remembers. “Everybody was just scratching their heads at once… Color stories had turned to earth tones, which just wasn’t that
exciting. Skateboarding was also going through a transitional period. Vert skating was starting to slow down and the whole street scene started to blossom.” At around the same time, snowboarding was beginning to plant its
roots on the West Coast. At a party, Woolcott bumped into an ex-Quiksilver sales rep named Tucker Hall.
Hall, who Woolcott says had the reputation of being a “funny, super outgoing kind of guy” had recently lost
his job in a round of layoffs. Woolcott mentioned he was on his way to Tahoe to tag along on a snowboarding
video project with Freeman. “I wasn’t even a good snowboarder; I was just starting to get into it,” Woolcott admits. “Tucker was all bummed out because he’d just been laid off. So I told him I was going on a snowboard trip and asked him if he wanted to come along.” Hall liked the idea, and in March of 1991 the duo set out on a trip that would
eventually change the landscape of the action sports market forever. What they found in Tahoe was more than either expected. Coming from a clean-cut, corporate environment, the two found themselves immersed in much more than the legendary late-season dumps of ’91—Tahoe’s snowboard scene was teeming with a raw, unapologetic attitude, and it had a profound impact on them both. “Snowboarders back then were full-on punkers, and there was a full snow/skate scene happening on the West Coast. It was very rebellious, very anti-establishment,” explains Woolcott. “There was also suppression on skateboarding, and the cops were all over the skaters’ scene because they
had nowhere to skate but in the streets. “The same was happening at many resorts, which were totally against snowboarders because they didn’t want them on the mountain. That’s when a lot of mountains didn’t allow snowboarding. So you had this full-blown revolution happening.” After being snowed in at Kirkwood Ski Resort by a blizzard that dumped more than 50 inches of fresh powder in two days, the two began batting around ideas for launching an apparel company that would encapsulate what they were experiencing and cater to snowboarders, skaters, and surfers.Back in Southern California, Woolcott’s then-boss Danny Kwock received a phone call that would inadvertently change both of their lives: “I’m going to hang up here for the rest of the week,” Woolcott told
Kwock. “I’ll be back in the office next Monday.” Two weeks later, Woolcott quit his job. Inspired by riding perfect conditions with a group of progressive pros—including Nathan Fletcher and Mark Gabriel—the spark that would
soon become Volcom was born in the parking lot of Kirkwood, and by the time they made it back home to Newport Beach, the concept was taking shape in the form of a stone. Woolcott ran the fledgling business out of a rented upstairs bedroom in Newport, and Hall handled
sales from his house in Huntington Beach—it didn’t take a lot of capital to get off the ground. The company’s initial investors were comprised
solely of family and friends Woolcott says, but declines to talk specifics. “I went to my dad in the beginning and said, ‘I want to do this, can you
help me?’ Because I had no money— zero. I was dead broke. And so he loaned me the money and then we started the process,” says Woolcott.
With the first round of funding locked down, the crew began to develop the brand. Late-night sessions creating art, logos, advertising, and product at Thom McElroy’s eponymously named design studio in Costa Mesa became a creative outlet for the team, which operated on simple principles of self-expression and differentiation. “Whether it was art, ads, clothes, or movies, we’d look at the market and what it was doing and then we’d do something different. We didn’t have a lot to lose, so we could take chances,” recalls Woolcott. “If it didn’t work it was okay.”
In fact, the company didn’t settle on its current name until after several rounds of trying to register others—like Stone Boardwear and
Malcolm—were unsuccessful. But what they did have was a strong logo, which would inevitably become the now iconic Volcom Stone.
“The stone came from a rock book that Thom [McElroy] found. It’s actually the center of a diamond, which we put on the computer, turned upside down, and messed with until we came up with the final logo. “The word itself took some time because we couldn’t register Stone,”
he continues. “Volcom comes from my nickname, Malcolm. We tried to register Malcom too, but that was taken. So we looked at the word
Malcom. In the letter M there’s a V, so then it was Valcom. But Tucker didn’t like that, so we changed the A to an O—that was Volcom. Once
we got there we thought the name had some strength and uniqueness, so we slept on it and played with the artwork, and then went to see if
we could register it. Nobody owned it, so that’s when we decided we’d found it.” Armed with solid branding and artwork, the Volcom team didn’t wait for product to begin marketing. As Frog House Owner TK Brimer remembers, Volcom stickers began to pop up around Newport Beach more than a year before any product was ever sewn, stitched, or printed. “He [Woolcott] did the most amazing job of preemptive marketing I’ve ever seen,” says Brimer, who was the first retailer in the world to stock Volcom product in his store. “This guy started making stickers about Volcom a year before they ever came out with any product. So for over a year he’d bring me free stickers…When they finally did come out with product, they didn’t have to pitch it to me; they knew I was going to carry it no matter what. They had been giving me free stickers for so long that I had to carry their stuff,” Brimer laughs. Not to mention, Woolcott lived directly behind the Frog House, a stone’s throw away. “But when the product started to come, there were no more stickers. The next several years you couldn’t get a sticker from Volcom anywhere—another amazing marketing idea. There were kids making their own stickers. There were stickers on eBay selling for $100. So he went from flowing the stickers everywhere to cutting them off completely… It got the buzz going and kept the buzz going.” But finding retail floor space outside the brand’s backyard—literally— would prove to be more difficult, and after incorporating in May of ’91, Volcom’s revenue finished the first full year (April 30, 1992) at a meager $2,600. Fortunately for Woolcott, the success of the Slater movie helped him land a Budweiser commercial, which was filmed in September of ’91 and began airing on national television a few months later. Each time it aired, a residual
check came in the mail. That additional income acted as Volcom’s unofficial T&E budget. If a $300 check came in the mail, Woolcott and Hall would pile into a truck and drive up the coast to surf, skate, visit retailers, and hang with friends on the way to Mammoth or Mount Hood. On one such mission, the two made it all the way to Seattle. Hoping to convince SnoCon Owner John Logic to carry their product and catch a Nirvana, concert along the way, they went Although Logic wasn’t quite ready to place his first Volcom order, the growing grunge scene in the Northwest was another flame of inspiration that helped fully forge one for two.
“HE DID THE MOST
AMAZING JOB OF
I’VE EVER SEEN.”
—TK BRIMER, FROG HOUSE OWNER
“This is where we belong,” Woolcott remembers thinking after the trip. “We plugged right into the new scene.” Partially funded by Budweiser
residuals, they decided to spend the following summer riding at Mount Hood and then headed to Hawaii to surf later in the year. Being submerged in this cycle created longlasting relationships with some of the world’s best action sports athletes, which would prove invaluable
to Volcom’s identity. “Even when we didn’t sell anything, we never got discouraged—we were stoked,” Woolcott explains. “We’d go to Hood in the summer and hang with the guys to ride pipe and skate. And then we’d come back home for a while and then go to Hawaii.” The stories from this period in Volcom’s history have become their own brand of action sports lore—everything from finding refuge on Eddie Vedder’s hotel room couch in Maui to dodging tanks on the 5 freeway during the riots in L.A.—and if ever compiled into a book, it’d give Mötley Crüe’s The
Dirt a run for its money. Amidst all the madness, Volcom was slowly seeing growth. Selling $96 worth of tees here and a dozen pairs of shorts there began to add up. But it wasn’t until 1993 that all the ingredients really came together.
Along the way, Volcom was slowly assembling one of the best snowboarding teams of the era. Legendary athletes like Bryan guchi, Terje Haakonsen, and Jamie Lynn were gravitating to the brand, and although their professional careers were just beginning to explode, so was snowboarding—especially in Japan. “The Japanese market was super fired up on snowboarding,” Woolcott recalls. “At that time, Bryan Iguchi,
Terje, and Jamie Lynn were all on the team, so we had a very special connection with Japan through snowboarding and through these guys.”
It wasn’t until meeting with a Japanese distributor in a 10’ x 10’ booth at ASR that they fully realized the potential of this new market. “Our first order in Japan was way bigger than anything we’d ever seen,” Woolcott recalls with a smile. “I remember it took me two hours sitting out in the lobby at the trade show to add it up. It blew my mind; it was something like $32,000!” The only problem was that Volcom didn’t have enough money to produce the order, so the distributor agreed to give the still-fledgling brand a deposit up front. The much-needed funds seeded Volcom’s production. The product checked, and as demand for action sports strengthened in Japan, so did Volcom’s relationship with its distributor. “Snowboarding is really what catapulted us, and we had the Japanese market to support us—that was huge.” Woolcott explains. “The Japanese market was very excited about what was happening in America and what was happening with snowboarding…It was a great relationship—we’re still very good friends with all those guys. They hold a very special place in my heart.” By the end of Volcom’s second year in business, revenue had spiked to $171,000, but along with the growth came growing pains. Over the next few years the company began to outgrow the peripatetic lifestyle that Woolcott and Hall had become accustomed to, but the expansion of the action sports market helped buffer some of the challenges inherent to developing a brand. At this point, all of Volcom’s production was being handled domestically. The team would buy its fabric and trims, oversee the grading and markers, and make routine trips to the cutters, sewers, and washhouses. The burden
of tracking payables and receivables, managing marketing campaigns, and making its own action films was just too much. Eventually parts of the
business were overlooked, and the brand’s retail dealers began to expect more—as did their primary investor, Rene Woolcott.
It’s 1996, sitting at home—a double-wide trailer on blocks overlooking the ocean at Laguna Beach’s northern-most beach—the phone rings: “Son, looking at your numbers, if you don’t get your act together, you’re going to be out of business in less than three months,” Woolcott
senior says, not impressed with the financials he’s looking over from his desk in Virginia. “You don’t have that much inventory, your receivables are high, and I’m not going to bail you out. So you better figure it out.” Click. It was more than a phone call; it was the phone call. In what he describes as a defining moment, Richard Woolcott had a long, hard look inside himself just as he had years before lying in bed with screws in his skull. Needless to say, Volcom got its act together. “By the latter part of the ’90s things were starting to take off, and I think the responsibilities of the company were getting ahead of where we were maturity-wise,” Woolcott admits. “We had to grow up.” Tiny production runs had built
scarcity and demand for the brand’s product at retail, but it was time for Volcom to step up its game. Woolcott says he relied on the competitive discipline he learned as a young surfer to navigate the oft-deadly pitfalls of brand maturation. “That discipline helped us through the ’90s, which
were really our growing years,” he says. “It forced us to get better—no more just sending retailers 50 pink T-shirts. We needed to get away from
assortments and start offering product by color. We needed to do certain things so retailers could put more Volcom in their stores.” The company became more professional. As the executive team grew, they formed a competitive strategy and stuck to it diligently. It worked. By the time the Y2K scare was over, Volcom had resolved most of its operational missteps, unified two neighboring locations in Costa Mesa under one roof in an 86,000-square-foot building formerly occupied by Quiksilver, moved production to China, and significantly improved profit margins. The company put more than $36 million in revenue on the books in the first year of the new millennium, and its growth was just beginning.
“By 2000 we pretty much had all our pieces in place, and we really took advantage of it,” Woolcott says. “The business was taking off, we had
a great margin, strong sales, and we controlled our expenses. That set our model, and we didn’t deviate from it, no matter what. Even though we had a recession in the early 2000s, we grew through all of that; the whole industry was growing.” New retailers were emerging, established retailers were adding stores, and Volcom’s compounded annual growth rate over the next half decade—which Woolcott calls the brand’s golden years—was enough to raise investors’ eyebrows everywhere. By 2004, the brand’s revenue reached $113 million, and its profit margins were continually improving. Realizing the need for additional investment to grow, the company decided it was time to take the next step. Volcom was going public.
It’s June 29, 2005. Richard Woolcott wakes up, makes a cup of coffee, and steps out of his oceanfront trailer to check the surf—just like any other morning. On Wall Street, things aren’t quite so ordinary. Investors watch as a California- based apparel company’s initial
public offering prices at $19—higher than expected—before opening at $26, shooting to over $31, and closing at nearly $27 for the day. The success of Volcom’s IPO makes national news and raises more than $80 million. Back in Laguna Beach, the surf takes priority over the stock exchange. Exhausted from weeks of investor presentations and preparing for this day, Woolcott decides not to look at the stock price right away. At 39, he now owns 20% of a publicly traded company making headlines across the country, but it hasn’t sunk in. “I wasn’t ready to just plug into it yet,” Woolcott recalls the morning. “I don’t know, maybe I was in shock. I think I was just numb from the experience… Everybody was calling me, but I needed some time to myself, so I didn’t check the stock for a while. “Then I logged on to Yahoo Finance and it was the hot stock of the day. I was like, ‘Woah!’ Now I look back and think about why I didn’t enjoy that moment. Why didn’t I just get up, tune in, and ride the whole thing all day? But I didn’t.” Somewhere between the bedroom office in Newport Beach and Wall Street, the world embraced Volcom,
and Richard “Malcolm” Woolcott began living up to the nickname given to him nearly two decades earlier by his peers at Quiksilver. But, remarkably, Woolcott’s humble disposition has gone unaffected by his success. “You’re still the same person. You’ve still got the same job to do. You’re still selling T-shirts,” he says candidly. “With the whole stock thing, it was all about staying focused on what’s important—your friends, your family, and your business. Just do your job, and don’t let the hype and the craziness take you away. When I look back at everything, some of my best memories are from when I had no money. Because I had nothing to lose.”
At present—despite the recent economic meltdown—Volcom Inc.
projects fiscal 2010 revenues of around $320 million, has a significant
stockpile of cash on hand ($105 million as of September
30, 2010), which Woolcott calls the company’s “war chest,”
and recently awarded shareholders a special dividend of $1 per
share. In addition, financial analysts at Piper Jaffray named Volcom the number
one action sports brand in its semi-annual Taking Stock With Teens survey
for the sixth time consecutively.
Although the company hasn’t been impervious to the economic conditions
of the past 24 months—it was forced to reduce its workforce by 8% and cut
salaries during the worst of the recent recession—it weathered the storm better
than many and has its eyes set on growth.
“Volcom is truly becoming a global company,” Woolcott says. “That’s the next
chapter for us. We’ve done a lot of work here in the U.S. and some of the surrounding
areas, but now we’re looking at it globally… I think every brand gets
to this point, and that’s just where we’re at in our life cycle. The world’s become
more global, and so has action sports, but it’s something that will take time and
it’s going to be a lot of work.”
So far this year, Volcom’s expansion includes acquiring its Australian licensee
in July, launching an e-commerce site in September, and in October the company
announced it would soon be selling direct in Spain, a key territory in Europe.
But in an industry where aggressive acquisition strategies have been making
headlines and creating never-before-seen levels of market consolidation, Volcom
critics question why the company has remained relatively conservative since acquiring
both Laguna Surf & Sport and Electric Visual in ’08.
“You always want to look at opportunity, but I think strategically for us
right now we’re better managing two brands [Volcom and Electric],” answers
Woolcott. “We’re better equipped for that right now. That’s the way we’re set
up; that’s our DNA. We have to look at what makes the most sense for Volcom
right now and stick to our guns.”
Woolcott recognizes that the current environment is challenging and more
competitive than ever, which is why he says Volcom’s strategy hinges on the
principles of protecting its long-term position in the market.
Case in point: “We know that our decisions are based on the long term for
the health of Volcom,” he explains emphatically. “It’s a new environment; it’s
different, and I don’t know how it’s going to play out. Our industry is in a transitionary
process right now; it’s evolving before our eyes. But I believe that
Volcom has a place in this industry, and I feel strongly about that. Whatever
happens, there’s a spot for us here… We just need to position ourselves the
right way, so in five years when the dust settles, we’re still here, we’re still viable,
and people still want us.”
As Volcom nears its 20th birthday, market conditions are anything but
ideal. With record spikes in raw material costs, drastic increases in production
and labor expenses, and the challenges associated with global expansion
amidst a post-recession economy, Woolcott and his team have their work cut
out for them. But—if history is any indicator—it’s a safe bet that Volcom will
endure the elements. After all, its foundation is made of stone.
So the next time you’re in the parking lot @ the Wood and see a Stone! Well just say’n