Founders John Ballay and Matt Mueller of New York-based Knot Standard wanted to make stylish, high-quality bespoke suits for both online and in-person customers, but without the $3,000 price tag often charged by custom suit makers. Customers seem to like the lower-cost model; Knot Standard is for the first time an Inc. 5000 honoree--ranking No. 130 on the list and reeling in a cool $3.3 million in 2014, up 2,848 percent from 2011. Here's how they did it.
--As told to Spencer Bokat-Lindell
Matt Mueller and I were friends living in the United Arab Emirates as expats. I worked in private equity; Matt was working as the CTO for a private tech company. We were both living in Dubai. And what was a hobby of just going down and getting custom suits made started to become an eye-opener for the big dearth of the custom suit's existence in the United States. We were flying back and forth to the U.S. for weddings, getting lots of compliments on suits, jackets, blazers.
Meanwhile, the obvious thing in our face was that U.S. senators and fundraising guys and guys who were running hedge funds were flying to Dubai, and they were always the butt of jokes for the way they were dressing. So as Americans, we sort of had this stigma of being horrible dressers.
It wasn't the vanity that bothered us--it was the availability. In the U.S., we just didn't have anything available that was well-fitting. All the customizable options in the United States were 1,500 bucks and up--and it took eight weeks. The whole process was relegated to an age-old system: an old tailor on Madison Avenue or downtown Nashville or uptown New Orleans. They made it in the back of the shops. But what about those who didn't even have those options?
So we were in the UAE, and people would come into town, and we would make custom suits for them as a hobby. I was also trying to start a custom boot company, with custom leathers out of Central America, using a digital measuring platform. I was just talking with Matt one day, and asked, "What if I made YouTube videos of how to measure your feet?" And that clicked.
We thought, "What if we take this to this hobby I have of making custom suits and create 15 digital videos of how a tailor measures a guy?" So we started as granularly as we possibly could, in a tailor shop. The mass customization platform we have now started with a tailor, with scissors, and cutting, and saying, "Hey, if we had these measurements, what could you make?"
And what the [tailor] said was, "Well, we'd have to see the guy. We'd need to trace him out like this, and cut him out like this, we'd have to see how his shoulders stood." And we thought, "We can get you that. We can get you a picture. We can get you the way his shoulders slope. We can get you his height and weight, so you really don't have to see him."
Then we thought about what an algorithm would look like, what a systemization of this would look like. And that's what kicked off Knot Standard back in 2010. We then hired one person in New York, and one person in D.C. We had a two-month popup space in D.C. in a JP Morgan residential building, and we did a partnership with Uber where if you rode three times you got a custom shirt. All of a sudden, we were booked up with appointments and people pouring inside our office in New York... and there was enough demand to start opening in other cities.
From business casual to tuxedo formal, we want to have market penetration in the 20 biggest U.S. cities and 15 overseas cities, and I think that's totally achievable. We're through the first few battles, and there will be 10 more down the road. It's a hard, hard business, but once you have the wind at your back...it's really ours to mess up.