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July 7, 2009 10:40 PM   Subscribe

DB Clay, the Portland based artisanal wallet maker, illustrates their financial fall and rebirth in a 20 minute artumentary.
posted by wfrgms (16 comments total) 1 user marked this as a favorite
posted by Electrius at 11:32 PM on July 7, 2009

A bit challenging at times near the beginning, better later on though.
posted by The Monkey at 11:44 PM on July 7, 2009

For those who own and use one of these wallets daily, how do they hold up?

Also, "catagories" on the blog sidebar? That's something I'd do.
posted by maxwelton at 11:49 PM on July 7, 2009

"Artisanal" makes me think of cheese. Cheese in combination with wallets just Isn't Right.

Still, it's nice to handle a well-formed leathery pouch, cheesy or not.
posted by nonspecialist at 12:05 AM on July 8, 2009

Still, it's nice to handle a well-formed leathery pouch, cheesy or not.

These are canvas though. I was very tempted, but handling a well-formed canvas pouch doesn't have the same appeal.
posted by PeterMcDermott at 12:13 AM on July 8, 2009

DB Clay, the Portland based artisanal wallet maker, illustrates their financial fall and rebirth in a 20 minute artumentary.

Wow. There's more White People in that sentence than I've ever seen in my life.
posted by nasreddin at 12:50 AM on July 8, 2009 [7 favorites]

Canvas+velcro "surfie" wallets and watch bands were huge in Oz in the late 80s. Can't seem to find 'em now. Not that I'm looking that hard I suppose, but damn they were functional and hard wearing.

I had to check the submitter's Mefi number. That first link absolutely reeked. But, hey, sub 30000 so it has to be legit.
posted by uncanny hengeman at 1:27 AM on July 8, 2009

Damn. Sorry, the second link reeked. The first link I clicked on.
posted by uncanny hengeman at 1:28 AM on July 8, 2009

These are canvas though

Oh, bother. Yes, actually reading the text next to the pictures of the apparently-leather wallets would have told me that, wouldn't it.

And uncanny hengeman, if you have kids of a certain age, you might find that the "surfie" wallet style is still available, albeit with less sturdy materials and nowadays covered in Dora the Explorer or Ben 10 merch icons.
posted by nonspecialist at 2:06 AM on July 8, 2009

Hey neat post - I've seen a lot of these wallets here in London; very nice, and if I were a wallet guy (I'm more a carry nothing but a money roll kind of guy) I would probably purchase one.

I don't have time for the 20 minute film but was curious - does it provide any financials on this company? I noticed from the link "db clay is seeking an investment of $250,000—to buy about 20% of the company."

Which would put an implied value on the enterprise of roughly $1.25M which might be ok, but.

I notice the greater majority of the (again very nice) wallets cost $60. If we assume (and this assumption is a stretch) the wallets incur direct costs of $10 between materials and manufacture, then we've got a gross profit of $50 (this estimate may be on the high side as it ignores absorbed overhead e.g., admin and other costs, as well as cost of sales). And this also reflects a direct sale; more than likely sales through retailers are netting them 50% of this (as retailers will mark up), so let's put gross profit between $25 and $50 / unit sold.

So seems they'd have to move between 5K to 10K wallets (possibly more if their gross profit is lower and definitely more as this isn't net profit which is totally different) to justify this 20% ownership, or between 25K to 50K to justify the implied value of the enterprise.

Of course this ignores the "trinkets" they sell ($250 / each), but since these are all "preorder", this seems to be an appropriate decision.

Curious: another comment notes "we are seeking capital for purchasing inventory, (re)start opex and hiring personnel", which makes me wonder why sell equity rather than just take on debt financing? Willingness to give up partial ownership raises questions about the cash flow statement.

Because the real problem with debt financing (i.e., bank or private loan since bank loans might not be that easy to come by in this part of the credit / business cycle) is the regular obligation to pay interest, and claims secured against assets (e.g., premises, equipment, working stock).

The advantage, of course, being debt service is tax deductable against gross profit, and there is no liquidation of equity interests.

I also notice they claim to be selling in "over 500 stores worldwide"; I wonder if this is a case of trying to grow too big too fast?

Personally, I'm a firm believer in small businesses bootstrapping themselves; growing organically via retained profits or small, short terms loans to bolster working capital, and have counseled several friends with small businesses in that direction.

These guys have got a great product and I always hate to see small businesses sell out equity; while it seems like a good idea now, he's giving up 20% of his future profits forever.

You seriously want to avoid selling ownership interest in your enterprise this early. Almost anybody likely to pony up $250K for equity won't settle for 20% ownership; that's the opening offer from his side. An early stage investor will, more than likely, want controlling interest or some form of preferred shares due to the riskiness of a small business in general, not to mention one that had been rumoured to be out of business.
posted by Mutant at 3:25 AM on July 8, 2009 [2 favorites]

In addition to Mutant's analysis, I'd like to point out that these things are made from various grades of duct-tape and similar roll adhesives (the "canvas" wallets are made from gaffer's tape.)

If you need a quarter million bucks to float a business that prints patterns on a wallet made out of sticky tape, you juuuuust might be doing it wrong.
posted by Slap*Happy at 5:14 AM on July 8, 2009

"Portland based artisanal"

What is it with Portland and word artisan?
posted by schwa at 5:45 AM on July 8, 2009

For those who own and use one of these wallets daily, how do they hold up?

I've had one for two years or so, and it has hardly aged at all. Not even a stitch has broken. The downside is that the material doesn't wear as beautifully as leather does, but at least the pattern on it (I have one with gold damask) hasn't faded or worn.
posted by Schismatic at 7:43 AM on July 8, 2009

I've figured it out: it's not an actual wallet company, but an experiment by a journalism class to see how gullible the green press is.

The wallets are made of "Tope"? So what's that, just Tyvek or something? No one knows, no one asks, all the green and gadget and green gadget blogs just quote db clay's own claims [PDF] about this miracle fabric.

It's supposedly vegan, which I guess is accurate if it's made of polyethylene. Oil is mostly ancient biomass which is mostly plants, right? No claims about being renewable.

The wallet's descriptions says they're made of gaffer's tape on the outside, Tope on the inside and (gold satin) nylon lined. Shurtape's gaffer's tape (the one I use) is vinyl coated, but Tope's description goes on about how it's NOT PVC and contains no phthalates.
posted by morganw at 8:34 AM on July 8, 2009

I have one, with a close up shot of human hair on the outside. (What is that-wheat? fire?)

Anyway, great wallet, quite sturdy, correct amount of pockets.
posted by kittensofthenight at 9:27 AM on July 8, 2009

I just got a wallet from Ragged Edge. It's pretty awesome, if you're into that kind of thing. They're in Clearwater, Florida, but they're not Scientologists. I asked.
posted by box at 11:20 AM on July 8, 2009

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