CROSSNET Update: We Just Surpassed 8-Figures In Annual Revenue
This is a follow up story for CROSSNET. If you're interested in reading how they got started, published almost 5 years ago, check it out here.
Hello again! Remind us who you are and what business you started.
Hi there! So excited to be back for my third edition of the Starter Story. My name’s Chris Meade and I’m the co-founder & CMO of CROSSNET, the world’s first four-way volleyball game. Back in 2018, I created one of the fastest-growing backyard games with my brother and childhood friend. Never in my wildest dreams would I think we’d get our made-up idea into the world’s largest retail stores and get aired on ESPN!
CROSSNET is currently sold in over 3500 retail locations, distributed in North America, Australia, and Europe and we’ve just surpassed eight figures in annual revenue.
Since the last time we chatted, CROSSNET has grown rapidly into one of the fastest-growing backyard games on the planet! We just concluded 2021 with our best revenue numbers to date and have expanded into Australia to take over the beach market.
Tell us about what you’ve been up to! Has the business been growing?
We had a few massive wins and several challenges last year, but all & in all, it made us better and stronger as a company.
Last year saw CROSSNET expand into several hundred Walmart locations. It was a dream come true having our product being sold in the world’s most popular store and someplace that I frequently shopped growing up in Connecticut. But it was also an incredible challenge and stressful learning process.
The scale & demand that the big box store takes from a planning & inventory management perspective is remarkable on such a small team like ours. If you mess up just one or two orders or have something delayed you could be out hundreds of thousands of dollars on a PO that they may never purchase again. We also learned the importance of finding the right vendor for your product.
Know your numbers inside and out. Are you charging enough? Are you negotiating enough with your suppliers? What is your gross margin? If you’re not hovering around 70% on DTC, you probably should relook at things and shift up your strategy.
When you just get started you’re happy to just be sold in retail. Eventually, you learn who are and aren’t the right partners. If you’re a luxury or high-priced item, do you want to be positioned in the store next to a bunch of $5 products? If your product is geared toward a more upper-middle-class income bracket, would you want to have your product in a lower-income store? We faced tons of questions like that, that we never even thought about running into.
2021 was also the year we encountered knockoffs & counterfeits for the first time. For the longest time, we were the first & only result for CROSSNET on the internet and now there are dozens of options for consumers to pick from. We had two options, lean into the brand and make customers proud to order the original CROSSNET, OR lean into the knockoffs and why they are garbage. We decided to lean into the brand and not give the knockoffs the time of day and this was the best decision we could have ever made.
However, it did require us to begin using vendor partners like Red Points to take down hundreds of copyright infringers using our photos & logo to sell a knockoff of our game online. We’ve also heavily invested in Amazon & Google PPC to redirect all customers to the original CROSSNET and the reason they are searching in the first place.
CROSSNET saw massive PR wins in 2021! We appeared on The Ellen DeGeneres Show, Let’s Make a Deal, and had our own 30 minute special on ESPN! We saw an incredible article that was included in People Magazine’s “Summer Essential Games” and continue to see the press love our game and validate our vision.
What have been your biggest lessons learned in the last year?
2021 was a year where the brand reinvested a ton of our profits to keep our foot on the gas. Along the way, we bumped our toes, spent money poorly, and did not have clear metrics in place to decide if a test was successful or not. We had the mindset of growth at all costs and to inflate our top line, sadly leaving very little thought on profitability. This is a terrible mindset to be in, especially since we bootstrapped this business & still to date have never raised money.
We spent money on billboards (three massive campaigns in Salt Lake City, Chicago, and St. Louis) and had very little return to show back to our finance team. We heavily invested in the volleyball community by having hundreds of players on influencer creative deals and even hosted a tournament with a $10,000 giveaway! Later on, we reflected and realized that true volleyball players probably make up less than 5% of our total market and CROSSNET is more geared toward families & beachgoers looking for a fun, new activity.
Once you firmly understand how much you can spend to acquire a customer, that’s when the magic happens.
Our biggest win of the year was finally boiling down our numbers and understanding them inside and out. We hired an incredible CFO who helped steer us in the right direction, and now more than ever we have complete visibility and understanding of how the business works. We are tracking ROAS and have firm numbers that we need to hit every day on our DTC business. If we’re not hitting our ROAS we have checks & adjustments put into place and if we are overachieving our ROAS target, we know we are not spending aggressively enough. Knowing the exact inputs and what you need to do as a marketer to keep your business successful is the best feeling possible.
What’s in the plans for the upcoming year, and the next 5 years?
This year will be filled with incredible growth for the brand. We are releasing an arrangement of new SKUs to take advantage of our 100,000+ loyal and happy customers. Some of these products include new varieties on the classic CROSSNET such as CROSSNET SOCCER & Pickleball. We’re also dropping limited-edition collaborations with USA Volleyball and have co-branded red, white, and blue original CROSSNET’s & inflatables. We sold out of our pool version way too quickly last year and we’ll finally have more than enough inventory this summer!
The business will strive to expand to over 4000 retail accounts this year. This May we begin our rollout to 300 Sam’s Clubs stores where we will have an exclusive limited-time product there. We’re actively adding over 10 retail accounts per month and have our sights set on international domination, especially in Australia & Europe. If we are to become a real sport, we need to be available in all different markets and have a retail presence that makes us accessible to all.
Have you read any good books in the last year?
I’m loving The Ride of a Lifetime by Robert Iger, the CEO of Disney. It’s such an incredible journey of how he spent over 30 years at one company working his way up from literally the bottom of the totem pole to one of the most powerful & successful businessmen in the world.
I’ve also started a weekly newsletter roughly six months ago that is currently being loved by thousands of entrepreneurs. Each week I give actionable advice on how to build your startup. What’s working for us. What’s not. How are we expanding into retail & navigating performance marketing struggles? You can subscribe here.
Advice for other entrepreneurs who might be struggling to grow their business?
Know your numbers inside and out. Are you charging enough? Are you negotiating enough with your suppliers? What is your gross margin? If you’re not hovering around 70% on DTC, you probably should relook at things and shift up your strategy.
Once you firmly understand how much you can spend to acquire a customer, that’s when the magic happens. Test on every single platform as many strategies as possible to bring somebody in. Figure out what converts at the most affordable cost and then see if it’s possible to scale. Network with as many people as possible in the industry and always be trying to get info from somebody who’s just a bit ahead of you to see what’s working for them.
I highly recommend you join the DTC Twitter community where people are constantly sharing awesome news & updates. Invest in yourself, in courses, and in networking with like-minded people. The internet is incredibly helpful and people who have struggled to find success are more than happy to share.
Where can we go to learn more?
If you have any questions or comments, drop a comment below!
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Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
Download the report and join our email newsletter packed with business ideas and money-making opportunities, backed by real-life case studies.
