Sell to the B2B Clients of Your Dreams

0:00Digital media is what sells product. You know, 97 % of people that have bought our product have not touched or seen our product in person. Hi, I'm Shuang Esther Shan, and welcome to Shopify Masters, your companion for starting and building a business. Selling B2B is often an excellent way to scale a company. And that's exactly what Misha Kruvret did when he was building his furniture company, Hollis & Morris. He went from designing custom builds for his sailboat to making furniture for Equinox, the Four Seasons, and the offices of Google and Netflix. Along the way, he emphasized pricing transparency and the brand's commitment to sustainability.

0:45Misha is here today to chat about how he built a successful B2B business on those values. Thank you so much for being here, Misha. My pleasure. Thanks for having me. I think we have to start off at the part where you actually didn't have maybe the conventional path to becoming a designer. It makes a lot of sense hearing your dedication to sustainability when we understand that you actually studied marine biology and environmental science. Tell us about that very fateful journey sailing down into a new adventure and also like a career path. Yeah, so I went to Dalhousie University in Halifax, Nova Scotia.

1:28I studied environmental science. I did a double major in environmental science and marine biology. In university, I'd written lots of papers and, you know, some seismic paradigm shifts about the environment and how to address it. And I think, you know, all very effervescent, thoughtful work. And then when I actually went into the workforce and started coming out of university, it was pretty eye-opening. But I bought a boat with some friends shortly after university. And it was a real jalopy, which is a kind word for a piece of s***. And it required a year of work. we had to put a new engine a new interior new sales new booms i mean essentially we bought it for nothing and poured a bunch of time we had time back then we had only time no money and so we poured our heart and souls into this and it was really incredible because it really did it was this like big project that made the even bigger project of starting a company feel that much easier.

2:39And also kind of like I'd been here before. So like dealing with customs in France, because the boat was originally from France, dealing with sail makers and mechanics and getting ultrasounds done on the metal. Like there's just so many weird components and having to pull it all together. It was like an industrial design degree, which is really what I became when I started Hollis & Morris. So we've worked on the boat for a year and a bit, sailed it from Halifax ultimately to Toronto, finished working on it and then sailed from Toronto to Guatemala over the whole experience was probably about two years.

3:16And, uh, and I came home and one of the best parts about the trip, about the whole adventure was actually working and figuring things out. And so when I came home, I shortly after started Paulus and Morse. I wish we could just do the whole podcast on your sailing journey, but you were able to actually make that desire to be a designer a reality. How were you able to actually launch Hollis & Morris? We were far from marketable. And you know what? Funny enough, that was a lesson as well. I started working for a few interior designers. I started making things just because I'd had the experience with making things in the boat and just saying yes to anything.

4:01And that was the second step of this crash course in industrial design. And the challenge came from making custom pieces for interior designers. And again, it was, you know, I spent about a year doing it and there was frustration, but there was also just an intense learning. But the frustration came with changing every single time, reinventing the wheel. So, you know, using stainless steel one day with glass and then using solid wood the next day with acrylic or whatever, just all these different materials and trying to figure out how to execute on it. And I mean, I had a good eye and I could tell that I was passionate.

4:41I just wasn't making money. And I thought I can't keep building something for someone else. So I launched Hollis & Morris in 2014. It was a collection. I felt like at that point, I just had so much creativity. I was working in my dad's two-car garage. Back then, I just had this energy and passion. And I also had this like chip on my shoulder in a sense, because I had no idea what I was doing. And I hadn't come from the world of design. I hadn't worked for a manufacturer. I hadn't gone to a brand. I hadn't gone to school. So I was a neophyte. And I really just looked at some brands that I admired and was just like, how do I get there?

5:26And if they were too big, I didn't bother looking at them right away because they were too many steps away. I couldn't picture the road. And so I looked at a smaller brand, a local Toronto brand that I really liked. And I was like, okay, there's five steps to get to where that brand is. Let's focus on that. And when I got there, I looked at a New York brand and I was like, okay, there's five steps to get to that point? What do I have to do from the marketing perspective? What are the images? You know, because at the end of the day, in the furniture and lighting industry, content, digital media is what sells product, you know, 97 % of people that have bought our product have not touched or seen our product in person.

6:10So learning that really quickly and just spending as much energy, if not more, on photographing and cataloging the pieces that I was making was almost as important as making the piece itself. I mean, of course, the design had to have roots in something and it took me some time. I think I was more reserved early on. And I've certainly grown out of that shell. I was careful. I was very minimalist. I was careful not to make any big sweeping moves because I hadn't been trained and I hadn't been formally trained in anything. So I paired it back. But then slowly over a number of product launches, I just got more and more comfortable and felt like I had a really keen eye for what people liked.

6:59And I think that was a critical element in growing the brand was just having that eye and trusting it. Through the early years, I saw lots of people questioning their designs and then focusing so much time on building something. And I think that's probably valuable for anyone in business. At a certain point, you just need to let it go and you need to trust it. And the end result is you have to go and push this. And I think that's, I was quick to put my marketing cap on and sales cap and just confident in the designs that I had produced. I think having that conviction is so important and this is something you had early on in your designing career and how did you actually get that first contract or first relationship with a retailer in Toronto?

7:46I produced I think about 12 or 13 pieces unique pieces all sort of along the same collection and we probably still sell five or six of them and I launched it at IDS which is the interior design show in Toronto in 2014. From there, I met sort of an unlikely crazy person who then, and I was just had my sales cap on and was convinced that I could build this thing. And he introduced me just coincidentally to the owner of Klaus. Klaus Nienkamper Jr. is the owner of Klaus, which is one of the most well-known retailers of modern furniture in Toronto. It's on King Street. his dad actually started Neen Camper which is one of the largest office manufacturing companies in Canada it's been running for 60 plus years and I think it was so interesting and I'm really fortunate to that it was close and that I got to meet his dad because I didn't just see the like a retailer I got to see a manufacturer in Canada that was more than five steps ahead because they, you know, huge, 100, 200 employees and a huge facility.

9:00But it was this aspirational thing. So I talked to Klaus. We connected on motorcycles. He gave me the front window. I designed a bunch of new product for that front window specifically. It was such an exciting moment. And then I, you know, I was running late and we put all the product in there. And then I think I'm, I really am an optimist. And I just was like, oh, well, the sales are going to come. It sunk in really soon, like three weeks. And I was like, oh, no one. Louse sells 50 brands, 40 and I'm 51. 50 of those brands are better known, are, have a market share, have a better, bigger marketing budget have been around for 10, 20 years longer than me or 100 years longer than me.

9:52And it was a realization, I can't rely on brick and mortars. The truth was that brick and mortars don't even rely on brick and mortar. They have a huge component of their business typically, which reaches out to the A &D community, the architects and designers. And I met some one one of those outbound salespeople. And I had this aha moment like, oh, this is how this business survives. It's not relying on someone walking by King Street and walking in and buying a couch or a dining table. They are actively selling an Italian brand because they have a geographical exclusivity to sell one of the most famous brands in all of the world, let's say Mui or Tom Dixon.

10:38And so it was this realization that, you know, the reason they kind of exist in a lot of ways isn't just to support local brands. In fact, that's not typically what clients or end users are looking for. And that was when this like light bulb went off. And Klaus was pretty supportive at that point, too. And he was like, you know, you should be going direct. And at that point, I had a couple people working for me that were really much better craftsmen than I am and talented. And I put my sales cap on and I set up appointments in San Francisco and L.A. and New York. And I flew all over pretending to know what I was doing.

11:16Creating an online presence, going direct to consumer was something new you did with Hollis & Morris. That's actually quite new for the industry in itself where there's no pricing transparency. Why was it so important for you to actually showcase the different pieces online and list the price as well? At that point, this is really before Shopify was Shopify. And the model was murky. There was no online transparency. Brands hit all pricing because there were so many middle people involved in the process. us. The amount of protection around what this MSRP was before the e-com days, it was the wild west and there was so much protection and there was so many people making money in the margins and that just never made sense to us.

12:10We were coming up as this was a transformation and it was a tough decision at the time. I'm thinking like eight years ago. It never made sense. So we just decided at one point, you know what, we're going to go alone. We'll put our prices online. There's no more lookbook and hiding prices and letting people dictate it. We're going to control the product and not only the product, but we're going to control the entire customer journey because we'd sold through agencies and those agencies don't know. They're just trying to sell product. They have 20, 30 products, brands to sell. They didn't care like we cared.

12:47And I think that was a huge moment where we said, we're going to do this alone. And then the irony was, once we had made that declaration and we really started pushing, we saw other brands that we were questioning that were clearly five years ahead of us or just bigger in general. We saw them reverting back. We saw them, you know, within a year, within two years, making those changes, putting their prices online, using a Shopify or using a e-com platform that was totally transparent. Yeah, totally. And I think that's a monumental moment for Hollis and Morris. And it's so interesting hearing how you navigated your own career and also the launch of Hollis and Morris.

13:29I'm going to take a moment here to thank all of our listeners for tuning in. Please take a moment to make sure you're subscribed or following Shopify masters on your listening platform and feel free to peruse our backlog of episodes. We also love reading your comments. So leave us your thoughts for this show. Thank you so much. For the second half of the show, I would love to just break down some of the strategic more business decisions you've made. So yeah, I think the part where you said you realized there's a big need to actually be proactive. Talk to us about the process of getting some of those cool clients like Equinox and Google and Netflix and how those relationships came to be.

14:17I had this fake it till you make it mentality and I'd go a meeting, I'd be unprepared, I'd figure it out, I'd make some mistakes, but I was always quite genuine and transparent. I'd say, you know, we're a small business and we're really trying to make inroads. What I discovered early on was the Ubers and Netflix, they would go to the architects and interior designers that were doing really cool and interesting work. They would go to them. Really, our business is built around a B2B is we go to architects and designers who have the Uber or the Equinox and Netflix clients, and we share with them, look at the thing that we're doing.

15:02One of the fortuitous things that happened over between 10 and eight years ago was the office was becoming an environment that felt like home. It was an extension of the living room. And there are ways of doing that. And there are things that make it easier and things that make it harder. My original thought was that I was creating a brand for residential product. And ironically, it was the right price point and also just commercial enough to be both. And we really still do a bit of everything. But that moment in time where especially floating it, you know, like our Link and Bennington, you know, all these light fixtures that have a substantial component of solid wood, that really warms the space up.

15:51And it really made it feel like an extension of the living room. So I would pitch to, you know, the big offices. And I think there was a lot of appreciation, certainly early days. I mean, we now have three outbound salespeople that do this every day. But I think there was a real appreciation that I was the designer. And sometimes I would share that. And sometimes I would pretend like we're a really big company and I'm just one of many salespeople. And we got to work with some incredible brands. I mean, we still do. We're really after not just a North American market, but we're trying to expand globally.

16:25And so working with big architects and Bjark Ingels or Snow Hedda, like these are some of these Starcatech brands and we're making inroads with them, not because we're really going after them in a sales way, but because we've just been able to build the brand and stay true to its like original tenants of environmentalism and good, strong aesthetic design without really compromising on any quality. And the fact that everything is still made locally in our new studio space. We have a 14 ,000 square foot studio space now. I feel like that's very important to highlight, right? The fact that you are designing with all of the clients in mind, but it's also with that thoughtful thread line of sustainability and also producing locally in Canada.

17:19So how do you make sure that all of the elements still can work together? The sustainability part, the manufacturing in Canada, and also at a price point that is still approachable? I was so conscientious to avoid greenwashing because really through my early years in university, I could see how companies were sort of taking advantage of that. So we always sort of stared clear. I mean, every decision we made was informed to have as small of an ecological footprint as possible. We, you know, from the renewable wood that we're using locally, you know, obviously LED technology, which was a no brainer, but at the time was in its infancy packaging and the building we're in.

18:12And we are so thrilled to be in a, you know, lead building with geothermal heat. And it's actually the old Cooper hockey manufacturing. So it's not a new building. It's a converted building. And we err on the side of caution because the reality is we still produce product. The goal is that that product lasts longer than any one of us. And that's always been really at the front of my designs is that we're not creating trendy product. We're creating timeless product. And every time we've produced something new, that's the aspiration is that it's timeless. And then using good quality material that can, that vision can actually be a reality.

18:55And that in a lot of ways has the greatest environmental impact. because if you buy something and you love it and you care for it for forever, but six Ikea lights that stopped working has six times more of an environmental impact just on just the simple math of it all, not where the materials are from and all that. So I think that's always been a driving force for the brand. To close off the show, I think the important part to highlight as well is There is that friction to the model that you've created where you have an online store, the pricing is transparent, you're allowing clients to purchase directly from you, and you're still within this realm where there are salespeople and there is this realm of art and design that you have to integrate with.

19:49How are you balancing the two sides of the industry? Yeah, that's a good question. I mean, I think the early adopters are architects and designers who study it, who think it, who dream it, who really live it. They're the ones that have the most influence and they're the ones that I value their opinion more than any. We make lots of end user sales through the platform, but we also are still predominantly a B2B business. It's been interesting with social media, especially because I think before, I don't know how you would have received the feedback that we've received on a day to day basis with whether it's someone who's buying a light or a table for their home and then sharing it.

20:33It's really rewarding and interesting to see what applications our product ultimately end up going into. And it's definitely not always the tech company. It is someone doing a renovation. And, you know, through COVID in particular, we were in a very fortunate industry where everyone was trying to improve their home. It was this wild shift where, let's say, it was always kind of 50-50 commercial and then residential. And then when COVID hit, it pulled right back to 20 % commercial, 80 % residential and remained that way for well over a year, at least from 2020 to 2021, if not beyond. And then there was, again, this switch.

21:15And I would say we're back closer to like 60 commercial, 40 residential now. Yeah, I mean, fortunately, we've always been nimble and not chosen one path. And that's really helped our business grow. And I think it's also a testament that the designs work everywhere. I just built a house with my close friend, John. He helped us build our new studio, which is like a 14 ,000 square foot facility. And at the same time in tandem, we were designing a home here. and we're launching in the process of launching 11 new products for the home that I designed and it nearly killed me. All these things smashing together at once, but it was such an opportunity and a privilege to be able to design all these new pieces for the home.

22:10I think it's just a testament to the fact they can translate in both a residential setting or a commercial setting, but also it started here. at home with that intention. Well, it sounds like building your home and also creating these pieces that fit in it is the chapter two of this sailing journey. It's like the grown-up version of the boat, if you will. Yeah, that's right. That's actually really good. I've had that thought a few times. Yeah, this is the exactly grown-up mortgage. The other one, like I said, there was no money and lots of time. And now there's a little bit of money and no time.

22:52Yeah. Well, it sounds like an exciting and also suitable canvas for the next chapter of Hollis and Morris. Thank you so much for being here, Misha. My pleasure. I really enjoyed it. That's Misha Kruvret, founder of Hollis and Morris. Shopify Masters is produced by Megan Coyle and Gogo Zoger. Our engineers are Miku Betlam and Matt Shorts. Benjamin Gottlieb is our managing producer and I'm your host, Schwang Esther Shan. We will catch you next time on Shopify Masters.