April 20, 2014 in City

Front and Center: Etailz founder Josh Neblett

Michael Guilfoil Correspondent
 
Jesse Tinsley photoBuy this photo

Josh Neblett is CEO of etailz, an online marketer of environmentally friendly products.
(Full-size photo)

Five facts

• Year business started: 2008

• Employees: 86

• Range of products: From $6 sunscreen to a $12,000 solar panel array

• Average order: $35

• More info : www.etailz.com; (800) 326-1325

Six years ago, Josh Neblett was finishing work on a finance degree at Gonzaga University when he experienced a classic “light bulb moment.”

In his case, the light bulb was energy efficient.

After winning a business competition among area colleges, Neblett and his future wife, Sarah Wollnick, together with venture capitalist Tom Simpson launched GreenCupboards, an online retailer of eco-friendly products.

Since then, the company has rebranded itself etailz to reflect its rapidly expanding line of merchandise, and added ecomom.com, everyCasa.com and Wollnick’s, a retail store at 1025 S. Perry St.

Last year, etailz was No. 127 on Inc. magazine’s list of fastest-growing private U.S. companies, with $24 million in sales. Neblett hopes to double etailz’s revenue this year.

The CEO discussed his company’s evolution and goals during a recent interview at etailz’s corporate headquarters in the McKinstry Innovation Center just south of GU’s campus.

S-R: Where did you grow up?

Neblett: South of Seattle, in Yelm (pop. 6,965).

S-R: What were your interests?

Neblett: I enjoyed sports, and the idea of selling things. In high school I started a little eBay business devoted to sports cards and memorabilia I’d collected.

S-R: What career did you envision for yourself?

Neblett: Financial advising. I intended to take over my dad’s brokerage business.

S-R: Why did you choose to attend Gonzaga?

Neblett: I learned about it through the basketball team. Once I started looking into the business school and the university as a whole, it seemed like the right fit for me.

S-R: What led to your starting your own business?

Neblett: I took a class called Creating New Ventures taught by adjunct professor Tom Simpson. I expected it to be more or less a glorified science project. But then we won a business-plan competition that included Gonzaga, Eastern, Whitworth and WSU, and that gave us the credibility to raise $288,000 and launch GreenCupboards.

S-R: Were you personally interested in green products back then?

Neblett: Sarah was more into that – things like organic makeup. I was more focused on the sales side of business, and saw an opportunity. I believed if we made buying a green product easy for people and offered it at a price comparable to the alternative, most people would choose the sustainable option.

S-R: How do you compete with Web giants such as Amazon Green?

Neblett: Amazon is our biggest competition – one-third of all online retail transactions happen on Amazon. But we look at marketplaces like Amazon and eBay more as partners than competitors, because we leverage their expertise to sell our products.

S-R: How can you compete on price?

Neblett: Of the 1,700 suppliers we work with, I’d say we’re among the top three retailers for 50 percent of them. Sometimes we’re their biggest account.

S-R: Did you have a mentor?

Neblett: Tom (Simpson), who co-founded the company with Sarah and me, has very much been my mentor throughout this process.

S-R: What lessons have proved most useful?

Neblett: One of his catch phrases that I keep in mind is “Only the paranoid survive,” because online retail is so competitive. Another is “Get out of the wheat and into the sky.” As my role has evolved from developing a business model to building a world-class team, I’ve needed to delegate more and set aside enough time to plan for the company’s next step.

S-R: Was the business successful from the start?

Neblett: We don’t like to use the word “successful” – again, that paranoid attitude. We’re profitable and self-sustaining, and on pace to be successful. But I wouldn’t consider us successful today.

S-R: How long did it take GreenCupboards to turn a profit?

Neblett: Two years. But we weren’t killing ourselves in the meantime. The typical model in online retail is to raise tens of millions of dollars, and then lose money for years as you try to acquire market share. That worked for drugstore.com and diapers.com, but you don’t hear about the 99 percent that it didn’t work for.

S-R: You launched your company just as the economy was sinking into recession. Did that worry you?

Neblett: Some of the best success stories in history have come from companies that were started as the economy was sinking.

S-R: Give me a for instance?

Neblett: Uh … I’ll email you a couple.

S-R: Did you ever worry that GreenCupboards might fail?

Neblett: Of course. Total sales during our first six months were $5,000. Our top seller was a toilet bowl cleaner.

S-R: What have been some milestones?

Neblett: Last year we acquired a competitor called ecomom.com. They had launched in 2008 and gone down that model I described – raised $12 million or $14 million and essentially squandered it. When we absorbed them, it made sense to rebrand our corporate name to etailz to reflect our growing array of products beyond those that meet our stringent criteria for green. And etailz is generic enough that it can be an umbrella for new divisions, new companies, new ideas.

S-R: What do you like most about your job?

Neblett: I love the craziness. Entrepreneurs need a few loose screws in the head, and I definitely think I have those. I love coming to work each day and then going home and still working.

S-R: What do you like least?

Neblett: A lot of people wouldn’t like the constant change, the quick decisions – our ready-fire-aim approach. But back in the day, when IBM was the industry leader, they had so many layers of bureaucracy that they’d waste months weighing decisions that sounded good the day someone came up with them. Our ready-fire-aim mentality lets us move quickly, learn and adapt.

S-R: Your mission statement mentions three goals: to sustain, amaze and delight. What’s an example of amaze?

Neblett: You amaze the customer by overdelivering – by doing something above and beyond what they expect, such as refunding their shipping fee if a product arrives later than expected. And our customers aren’t just the consumers; we obsess just as much on our suppliers – how we can help them grow their sales.

S-R: How do you decide which products to carry?

Neblett: We look at our key competitors’ best sellers – which categories are hot. And we go to a lot of trade shows to find up-and-coming products that fit our niche.

S-R: What do you look for when hiring?

Neblett: First and foremost, you have to fit our culture. If you don’t, I don’t care how smart you are.

S-R: How would you characterize that culture?

Neblett: Fun, dynamic, entrepreneurial. Some people are better suited for a 9-to-5 bank job, and there’s nothing wrong with that. But we need people who are going to stay up late and get up early thinking about work – how they can make something better. And they need to enjoy coming to the office and not be a Debbie Downer.

S-R: Are most of your employees young?

Neblett: Relatively. The average age has risen as we’ve hired more managers. Also, the fact that our earliest employees were 22 when we hired them, and now they’re 27, 28, 29 – it’s rising that way.

S-R: Are you planning to hire more employees this year?

Neblett: We’re in nonstop hiring mode. We currently have 15 job postings.

S-R: Do you see etailz as a buyout candidate?

Neblett: Not really. I believe building the company to sell would lead to bad decisions. We’re planning to be here 10 or 20 years from now. It’s naive to say a strategic partnership or acquisition couldn’t happen, but it’s not something we spend any time focusing on.

S-R: What would it cost to start a business like this today?

Neblett: The marketplace has changed so rapidly that I’m not sure you could build a website like ours today unless you were willing to start out losing millions of dollars.

S-R: What do your parents think of your career?

Neblett: I showed up during winter break from school and said, “I don’t know anything about e-commerce or retail. I know I have a highly lucrative job waiting for me if I want to take over the broker business. And this other thing isn’t going to pay me anything. But I think I can run with it.” And they were very supportive.

S-R: Did they offer any advice?

Neblett: My mom comes from the world of education, so she said, “If you want to continue to get our support, you have to get your MBA while starting the company.”

S-R: Did you get your MBA?

Neblett: I did 90 percent the first year. I only have one class left now, and the reason I’ve postponed finishing is because I still have access to the (Gonzaga) gym and can play basketball with the guys a couple of days a week. Once you graduate, you can’t get in anymore.

Spokane freelance writer Michael Guilfoil can be reached via email at mguilfoil@comcast.net.


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