Why Winners Bounce Back: Craig Morris’s Success Blueprint

welcome to the know your ship podcast presented by ehub I’m your
host Frank doce well welcome back man I’m so excited to have our guest here
today who is a Serial entrepreneur a recovering entrepreneur yes sir as he
calls himself and currently in a business development role with a with a
local company has so much experience and insight that he’s going to share
with us and a story that I like to call a cautionary tale I hope that doesn’t
make you uncomfortable but I think there’s so many lessons to be learned and
and your willingness to share your story we couldn’t thank you we can’t thank
you enough than you on this is the one and only Craig Morris and and Craig uh
currently serving as the Corner Canyon High School women’s head basketball
coach which is you know we’re we’re right in March M I know it’s April but
we’re right in March Madness yeah and and I so it’s interesting that you got
into you’re a you’re a former basketball player yourself I am correct and you
played High School where where did you grow up I grew up in West Valley so I
played at Hunter High School my folks are still there so is that right yeah
we we love West Valley were you a Powerhouse in high school you know we were
a football high school and and so my my stature and build now I get asked all
the time what position did you play and they’re caught off guard when I’m
like oh I play point guard shooting guard they’re like surely you played
football right and I’m like I was terrified I was terrified to play football
we had so many big dudes I mean we were sending running backs linebackers
Titans to the NFL right out of Hunter high school I’m pretty sure you had a
pretty decent like offensive defensive line contingent come out of Hunter
High School I mean I think that was a thing yeah absolutely for a minute we
did Y and and running backs right and I mean we had a NFL players so I played
basketball like that you know your Heart Wants What It Wants and from a young
age that’s what I wanted and you know we became better at basketball the year
after I graduated I was on my mission and all my buddies won the state
championship in both basketball and football the year after I left and I I
hope that I played a little bit of part in you know prep yeah hopefully right
absolutely and So like um definitely a football high school though and and
then had a couple good um good years as a as a basketball program gotcha tell
me about your your experience growing up was it kind of the idyllic childhood
did you you know did you did you run you know run ravage in the streets and
all of that did you have brothers and sisters tell me about your what was
like you see now about hey how do you know where all the kids are at in the
neighborhood like that was my life right you’d ride your bike around looking
for the house that had all the bikes that’s what we did right like we and I
tell my kids this they think that I’m just like going Uncle Rico or giving
them the stories or I’m like just shovel the walk like the driveway so I
could shoot the ball like just growing up I’m like I love to play right so we
were active like we didn’t have phones that you have now my kids all these
these distractions right so we we’re playing tag across the you know all
around the neighborhood we called the jailbreak and had bases and stuff and
kids are hopping fences and you’re playing clear until you’d hear someone’s
mom come and yell like dinner right and then we all run home play dinner or
eat dinner and then come back and play more games play yeah play till it’s dark
absolutely yeah that that’s the way to do it tell me tell me about your your
parents did uh did did your parents work growing up like what was your
experience on that I know you you were super athletic got engaged in all of
that stuff early on but but what was your what was your family background
yeah I actually didn’t know the word entrepreneur but my mom is and and was
then an entrepreneur like she has a beauty salon in the back of their house
um a detached garage that’s been fully built out to be a salon so she worked
from home but she worked my whole life my dad had a couple entrepreneurial
Endeavors and uh ended poorly and so he ended up working um for the Church of
Jesus Christ of latterday s Saints so he works in the church office building in
Salt Lake until postco and then a lot of them are remote but and and so I
grew up with a dad that’s working a typical 9et to-5 right and Mom there and
we would come home we check in and then we called it the shop we’d go and
check in in the shop right and then figure out but Mom was always around and
then we took Sports Andor dance whatever the extracurricular thing was very
very seriously my parents worked really hard to provide opportunities I was
in a like a song and dance group when I was young trying to you know I had no
talent in it so it didn’t last long right but like my parents were all about
giving us opportunities right my sister tried gymnastics and she was on all
sorts of dance things and played soccer and basketball and I have two little
brothers we all played basketball and soccer and then I got into tennis in
high school and we just always had support and my parents encouraged us to do
things that that you enjoyed but then also like that caused us to be active
all the time we were always engaged in something active well I’m going to I’m
going to hit on this theme a little later I think it’s really interesting
what you’re talking about and your parents giving you all of this exposure to
lots of different activities whether it’s uh dance performance Athletics your
mom’s an entrepreneur your dad’s working hard trying to provide opportunities
for you I think that’s really interesting because I know a little bit about
your background and where it ended up and so I’m just curious how that you’re
you’re your upbringing led to your path so were you did you find yourself you
know you go through Hunter High School you’re getting ready to go down you
went to college I did where’d you go a little bit of everywhere so I played
basketball down at Dixie after my mission had a little stop before Dixie it
uvsc UVU now but and then I actually got my I graduated from Utah State up in
Logan and you but you didn’t play ball at Utah State I didn’t okay I got
married at the end of our first season at Dixie priority shifted and and my
wife and I we just thought we like I’m not going to the league like you know
let’s focus on getting an education and figuring out kind of what I’m going
to do to be a provider gotcha and where did you serve your mission Taiwan oh
yeah so learn to speak Mandarin which sort of led to most of what I did
entrepreneurially um using the language and and sourcing products from China
so kind of opened up a new pathway yeah got you okay so when you went into
college after your mission were you is that what you were thinking like you
were thinking I’m going to be an entrepreneur or did you have a track that
you were headed down so I knew I love sports and love being around them I
also knew that I wasn’t going to play at that high of a level and so my goal
from a young age I thought if I’m an athletic trainer like I could be an
athletic trainer for jazz or for MLB team right so for me it’s it was about
progress and I’m like look I’m not going to progress as an athlete all the way
through that but I feel like I’m good enough I can learn I can you know and I
can progress professionally in something that I’m really interested in like
being in sports was the goal right and and that all changed as I was
departing my mission my mission president actually is the the co-founder of
it’s now called IIT it was icon health and fitness they own Nordic Track and
Pro Form and Le I used to know some guys I up up in Logan right so like as
I’m leaving and and if you’re familiar with like the the way that a Mission
Works he’s my mission President right he’s the the leader over this group of
us that are called to serve in in Taiwan and and he challenged me he said why
don’t you go home and just take a business class he’s like that’s fine if you
want to be an athletic trainer that’s fine he’s like do you really want to
tape ankles for the rest of your life that’s how he phrased it right and at
the time I’m like well that makes it sound terrible it does right but what if
you’re taping Larry Bird’s ankle that’s pretty cool right and so like for me
I’m like I never thought of anything different I’m just like look I don’t
want to be a doctor I’m not going to go to school for eight or 10 or but an
athletic trainer I’m like maybe six right I can make that work I could be
around Sports and like like maybe I’ll maybe I’ll work at the U or BYU or
something like I never had really aspirations to leave the state but I’m like
I want to be in sports right I got into college I I did what my mission
president said right I’m like cool I’ll take a business class I’m like wow
this marketing class is pretty entertaining like this is cool right I like
understanding what makes people buy right how do you play into emotion and
and some of the the psychological things right and I’m like I’ll take another
one I’ll take another one I started taking more business classes and before
the end I’m like this is what I want to do now I didn’t have it like oh I’m
going to start a business per se but I knew I wanted to be in business I
thought look like at the end of the day if I’m trading hours for dollars
that’s a challenge right there’s there’s very little scale in that and I
thought but if I can be in business in some capacity then maybe the exchange
of value can be such that I’ll feel like I’m being compensated for the the
efforts that I put in at least how I value myself yeah absolutely uh the
founder of ehub uh is fond of saying dollars follow value yeah and so I love
that if you are out don’t don’t tell him I said that because then he’ll think
it’s a compliment I’m not sure I want to do that on air fair enough but
anyway so if you’re out creating value uh I mean I think that’s a fair
exchange right you’re out creating value and the dollars follow the value
totally that you’re creating and so I like that because growing up I I grew
up in a very similar with in an athletic family and one of the things that we
talk about one of the things we learn in athletics one of the great lessons
is hard work pays off dedication pays off sacrif device pays off and so I
think that is analogous to can be analogous to a business setting totally
those lessons that you learn as an athlete and on the field that’s where it
transfers over because you can go and outwork somebody yeah you can be more
dedicated you can sacrifice more and you’re going to get the value you’re
putting in it that it’s going to come back to you absolutely so so you get
into you get into this now mindset that well I’m I I want to be in business
now you’re going to you’re going to leave Athletics behind a little bit and
you’re going to go out and and make your mark in the world so after college
now you’re married and you have to take care of a family after college where
does that lead what does your path look like yeah so right before I graduated
actually and I don’t know if you’re allowed to do this maybe I should be
careful but I took out a student loan to buy an existing business rates were
really good on student loans I had no student loans up until then and so I’m
like think you can do that yeah I’m a student right I’m like I don’t know so
I take out the student loan right and and I talk with my wife listen if it’s
illegal to do that because I don’t know the the answer to that I I mean I
think I have a feeling Abby’s fantastic she can take she’ll take it right out
perfect it’s been paid back in full so it’s fine right I’m like it was it was
paid off um but I bought a business um and we we bought a business my wife
and I in the uh inflatable party business slides and I had a trailer and I
had a Jeep and I hired my little brother and I hir my wife’s little brother
and and I po this business that I was like I don’t have to do it I can just
market now I know how to market right I have this Mar I like I can do that I
can get customers and I’ll just send my my brother run yeah and and it worked
like 80% of the time you know but like any entrepreneur right you always have
to be ready to wear all the hats mhm that was my first just small small like
Learning lesson and oh my gosh like it’s Saturday and my brother is sick
Andor something comes up I’m driving clear around the valley setting up and
taking down balance houses all day long right and I’m like wow making the
money that I make when I have to do the work isn’t quite as cool as it is
when like my brother finishes the day and I’m like counting the cash and I’m
like I was at home with my wife for my kids right yeah so so that was the
first little thing Le that is such a great that’s such a great lesson lesson
number one in the podcast today if you’re an entrepreneur and you’re starting
a business you’re just going to wear every hat that’s just how it goes yeah
there’s not many times that you can get get around that so you learned that
early on but I didn’t learn it well enough to avoid we to get there I was
going to say I was going to say you learned it but then you thought well I’ve
learned now I can start my next yeah and I’ll do it better right and I’ll set
proper expectations and I’ll build it out so that I don’t have to do that and
that’s the end of this story right is that you started the next thing
unbelievably successful and I don’t have to work anymore right I don’t have
to do anything I just sit around is that what happened no no so that led me
the the business was cool like it made extra money but it was seasonal right
so I still had a job so I left Logan my wife and I wanted to be back she’s
from South Jordan I’m from West Valley we were like let’s be close enough
that we can go to all the things that we want to far enough away we don’t
have to go to everything so we bought a house in Eagle Mountain property was
really affordable back in 2009 we you know we benefited from the collapse
sorry for those that were hurt during it but like you know we were fresh out
of college and we could afford a home so we do that we’re running this and
I’m working for zag in Salt Lake City oh very nice so I got a cool job out of
out of college I’m working on sourcing products for them right I’m anything
from headphones to most of what they were doing was done domestically with
the invisible shield and then I’m working on like hey should we launch like
laptop speakers like back before there were great speakers on laptops right
like but there were things there were opportunities that we were exploring I
lasted about 8 months there and I’m like I’m out like I need to go do my own
thing I’m like I just felt like I was underpaid not a shot at them right like
I’m just the as I’m sitting there I’m like I’m worth so much I’m good at what
I do right I should be paid more and that was really what drove me to say
like I want to be an entrepreneur not like this I didn’t grow up as spiring
to be it but I was I was frustrated with I’m showing up and like I felt like
I could get my job done in like an hour and I’m like we’re playing ping pong
and we’re doing like I’m just like sitting around I’m like water cooler talk
was fun for a couple weeks and then I’m like look like for me this isn’t
fulfilling and so I quit with a buddy we were at zag we both quit same time
let me ask you this question before I don’t me mean to interrupt you’re at
zag you and your buddy probably feeling the same thing MH and did you come up
with a concept with your buddy while you were at zag like I think we can go
do this or did you both just decide we’re we’re better than this we’re out
we’re going to go start something else you’re going to learn the further we
get into this that I don’t think all of my decisions through right I’m like I
I told you it was a CAU T right and I’m like I don’t like my job anymore quit
and you’re married married two kids at the time with two kids and a mortgage
yep and I’m like I’m going to quit my job I’m like it was I thought like my
bounce house business can maybe give us six months Runway maybe I’m like so
I’ve got a little bit of time you’re still doing the bounce house and you’re
at zag and now you’re just doing the bounce house okay and so I’m like look I
know it at the time I didn’t think it could be big it’s really funny because
my wife and I talk we’re like if we had kept that business that maybe could
have been big enough that like that’s what we would have done or it would
have opened up doorways you know but like I didn’t like it it wasn’t glamorous
it wasn’t sexy right and I’m like and once I figured out that like there were
going to be employee challenges I’m like I don’t want this I don’t want my
weekend to be potentially sucked into doing these so I I sold that business a
few months later I’m on KSL the classifi looking for other businesses to buy
because I had already paid off the student loan for for this business I’d
bought and I’m like wow maybe I’ll just buy businesses like I’ll buy a
business because I I can run it at least at the time I thought really well I
can run it well I can pay off this loan now there’s no debt now all the money
that it’s making even though it wasn’t huge sums I’m like maybe 30 Grand in a
summer right you know which back in 2010 that was pretty good feels pretty
good yeah I’m like I can do this talked a couple buddies into buying another
business we bought the old equipment for a three Onre basketball tournament
and I’m like nostalgia I love basketball three on three Hoop It Up round ball
Ruckus I’m like we’re going to do this and both of my buddies and I we lost
all the money we put into it we could never like it just had run its course
three on three at least the way we were trying to do it out on the blacktop
and you know like these portable Hoops set up people are like yeah I don’t
know we’ want to play indoors and five on five is cooler and like they’re
just it flopped right so we each lost pretty sizable amount of money on that
so I’m on KSL looking again I’m like okay one for two like this would be all
right M I um have lunch set up with my buddy we leave zag together right and
so we’re like hey let’s just keep in touch so about every three weeks we’re
going to lunch there were a couple others that had left zag around the same
time for other reasons some had cool opportunities but we just kind of get
back together like the old zag crew right so we get together and I’m like oh
actually after this I’m headed down to Sandy I I’m putting an offer in on
buying a clothing boutique that’s going out of business he’s like wait did
you find it on KSL and I’m like yeah he’s like I’m going to see that tomorrow
and I’m like this is so weird I’m like let’s go together right so anys we
show up together we look through all this stuff and we were like we don’t
want to run a business like we don’t want to run like like be in like a
little Boutique selling like lagona beach jeans and and you may not even
remember those but they were really popular and had like bedazzled stuff all
over these are designer jeans 300 bucks a pair whatever and we’re like but we
could probably sell them on eBay like we could probably move some of this
stuff like in other ways let’s let’s make an offer he was in a distress
situation like he owed his landlord a bunch of money like like you know just
like he’s just trying to get out we completely low balled him we offered him
five grand for all of his inventory and he’s like if you can get me five
grand by tomorrow then I I’ll do it so we got him five grand bought all his
stuff moved it into my basement set up like a little Boutique in there we’re
taking pictures of everything and my buddy is putting it on eBay and we’re
just we’re just hustling right we turned that $5,000 into about $5 $30,000
and we were like we’re figuring this out right right in that we realized
though that like this there wasn’t scale how many like boutiques were going
to go out of business right we didn’t want to be like the like going to
weekend auctions and buying out storage units and hoping that you got good
stuff right so we’re like look we were in the same department at zag like we
have a skill set in this product development he’s a really creative
Innovative guy I speak Chinese I’ve been sourcing products from China right
this I love where this is headed and we’re like dude let let’s print business
cards cuz that’s just what you do right AB print business cards merch get a
hat with your logo on it absolutely and we’re like let’s just we’ll join BNI
groups corporate Alliance is no more but back in the day I remember corporate
Alliance absolutely we’re going to every breakfast every lunch every event we
can be at and we’re just slinging business cards we’re like we can help you
get stuff made in China and we can beat prices so we’re competing with promotional
products companies we’re competing with all sorts of Random nothing that made
sense all these little niche you know categories and it took us 10 months to
get our first order and our first order was for $3,000 and we’re like oh dude
this is not going to work all the while we had been like cultivating some
other opportunities building samples for people and at about the 14mon Mark
we got a big order you’re grinding yeah and and like he’s working a job on
the side I’m still running my business trying to like it seasonally right we
had a couple places that would rent them indoors like schools or things but
not very much money right but we’re like we can make this work and I’m not
sure how it’s going to work but like we can make this work right like we
believe and so we just kept hustling and we got this big we had helped a
group in Utah County they were buying trampolines domestically and we helped
them design a trampoline that we made in China for them and save them like
70% of what they were paying huge huge margin increase and then we helped
design a patent for them that um the pad allowed it to trampoline to be in
ground and then it’s a ventilated pad system so when you jump on it the air
can come up instead of like the pad just slapping down right our first real
win if you will and they were consistent they ordered from us for five six
years probably and I just didn’t like the business very much okay I think I’m
feeling a pattern here did you what oh yeah let’s do this since you’re taking
a drink I’m going to take a drink have you ever had this before the bucked up
it’s fantastic so good I’ve been a monster guy but oh I like this way better
you know zero sugar and if you need a little pickme up this is the way to go
yeah so are you profitable yes with the trampolines and your product sourcing
we’re profitable um but not where you want to be yeah not making it you know
I mean we’re working and your buddy’s still in it and is he working another
job and doing the exactly product okay and you’re still running the bounce
house and doing by this point I had sold the Bounce by the time we
trampolines right so we had started with business cards and then I finally
offloaded that I’m like I’m going to I’m all in I’m all in on this right
let’s make this go and that gave me a little bit of Runway cuz like I said 10
months of no cash nothing coming into the business right and then our first
order like barely covered its costs so we were like 14 months of no money and
so me selling the bounce house business like you know was able to make ends
meet for a little while extend that Runway just a little bit right yeah so
but you got to a point now this has happened it feels like this has happened
a couple times now you got to a point where just like I don’t like this yeah
I don’t this isn’t this doesn’t align hindsight 2020 now I’m learning I’m the
problem at the time I’m like a problem with this business this is so that’s
exactly where I mean I think that’s what we’re talking about is you go
through this thing you start to get some maybe get a little traction and you
just say ah I don’t it doesn’t it’s not a fit I don’t like it I want to do
something else you mentioned earlier like I don’t like am I going to have to
manage employees I mean that’s one of those things that it’s like the stuff
you have to do that isn’t the Glamorous stuff to get to the to be really
successful yeah and and so is this a pattern that occurs several times or H
how do you proceed after this you don’t you’re not super fond of the
procurement product procurement anymore yeah so part of it was I’m I’m
spending all night staying up all night working with Chinese manufacturers
I’m traveling a ton back and forth to China back and forth I’ve got young
kids right I’m missing out on things so there’s that part of it right there’s
a little bit of like do I have this work life balance which I think is a
fallacy but I’m like you know like I’m questioning that at the at the time
right and then I’m looking and saying like can we really make this a thing
like my trampoline client right as a broker we might make somewhere between
10 and 15% now if the orders are sizable enough like then that can sustain
the business but typically if you’re in consumer product goods right you have
four six 8 10 12x markup on your product like I don’t know exactly what like
all the costs of running their business are so I’m not sitting here saying
they’re printing money and we didn’t feel ripped off we quoted the price they
accepted the price but as I’m the more I’m in this right this happens over
and over again I’m like I want to be on that side I want to be on that side
where like I have the multiples right so it isn’t so much that I was like oh
I’m too good for this business I don’t want to do it but simultaneously this
has been my biggest challenge is simultaneously I think I need the cash
that’s coming from this I’ve got to have this but I want to be there right so
I’m going to go start and so we start sourcing products we’re running
Kickstarter campaigns trying to launch things right we we start to figure out
like maybe we can sell KSL deals like there was all these deal sites back in
the day right like even Jane we sold a lot of stuff on all those deal sites
just trying to like how do we get on the multiple side of consumer product
goods but the bread and butter was always still the service based side where
we are building supply chains right at a certain point in time I was so
committed to Building Product companies I didn’t have time to run it any
anymore right but like so instead of figuring out like could I sell this do I
have the time for it I’m like I want my customer to be good I just introduced
my trampoline client straight to the manufacturer and I’m like hey I don’t
want this to fall through the cracks you guys have a good thing going as
their business has grown over the last you know decade I’m like wow wow like
right like but but like for me I I was it wasn’t like oh man my product
companies were they were the Hope right I’m like I can get on that scale side
of it but I I’ve got a family the whole time right I don’t have the luxury of
like sleeping on a couch like some entrepreneurial stories that I’ve read
it’s like ah I just moved to Silicon Valley and slept on a couch and like
just made it work without eating Ramen I’m like I got kids I’ve got a
mortgage I’ve got like I’ve got responsibilities no one’s fault but my own
but like that was my journey right so I’m in this position of like I need to
provide but I want to be something I want to create something I want to build
something and you started once you’ve been an entrepreneur for this long you
start wanting that exit right like that’s really what became I’m just like
I’m going to exit I started a sock company right I started like selling
things on Amazon and I got these little we call them micro brands at the end
of the day it’s a just a brand that no one knew what it was we positioned it
on Amazon of like hey there’s there’s not a ton of socks that are cool on
Amazon that like fit this price point so we’ go and launch a brand right and
then we’d pop up a site driving everything to Amazon right so like then when
the socks start going really well and I’ve got an investor on this another
investor or another friend comes to me like dude you’re crushing it with
socks like can I get in and I’m like well we don’t really need help there but
if you want to put some like seed money and I can start this other micro
brand and so I start doing this like and again the pattern isn’t so much that
I hated the socks right like sometimes it’s even my same investor that would
get involved in multiple categories they’re like this is going so well let me
double down and I’ll put more money in and go launch this and go launch that
and our Revenue went from you know 400,000 in year one on saleing on Amazon
I’m like whoa like we’ve it took me forever it took me like three full years
to get to 400k with my service business right like we’re 400k we’re inching
towards Just sh a million in year two by year three we had surpassed 3
million in revenue on Amazon and I’m like I’m gonna make it right and I have
investors at this point in each of these little Brands they’re all growing
and then Amazon changes the algorithm they change the policy on how can
gather reviews right and so like for for me in that sense I wasn’t trying to
get out of any of them necessarily but one of them wasn’t enough for me right
it was like I got to like if one’s going well let me do more let me do more
let me do more and then once you get spread so thin like in my case we had
borrowed money we were leveraged right so when when our at 3 point whatever
million we were doing that year I mean you’ve got a pretty healthy amount of
cash flow coming in that stopped overnight and I couldn’t service debts
anymore and I couldn’t like pay my employees so then I go through the cycle
of I got to lay off employees right can we still Salvage this and and again
hindsight always comes back and you’re like I should have walked away from
that business so much earlier but I held on held on I have an investor that I
feel this responsibility towards right I have like that’s like my baby right
I spent like Blood Sweat and Tears for three four five years building this
and as it’s just falling away from me I’m doing everything I can to hoard it
back right and I’m just stretching everything personally and I’m like at the
end of it like I’m going down with the ship right like I I left myself no
other choice right like potentially if I had been willing to sell earlier
before the demise maybe my investors could have gotten some money back maybe
right like at that point our revenues were had dropped so it’s not like we
would have had like this sky-high valuation but we potentially could have
Salvage something we moved a few of the assets to try to get some of our
investors money back but it was so much all at once that just came crashing
down and I’m like like I mean that that was at a certain point time you lose
enough people’s money and and then they like to come after you and if you
don’t have money then you know there’s not a lot of things that you can do
other than you know go on the bankruptcy route let me ask you a question
about what you were building on Amazon did you did you lose focus on what was
making money absolutely okay and is that a result of just going too broad I
think breath is was the killer then not for every business but Amazon is
unique in that like you need depth of inventory so that you can play into the
algorithm never have stockouts right so that you’re your score if you will
grows your ranking yeah and you just keep moving those same ones those same
ones right but we wanted to grow we’re like hey like our dress socks are
doing well let’s add athletic socks man we’re crushing the men’s category
let’s add women’s wait we should do matching boys with men’s that would be
cool right like you know I’m a dad and like I’ve got and like so we just
started like when money’s coming in yeah exactly when revenue is coming in
like Revenue fixes a lot of problems right so you’re like yeah like we have
some stuff that was slowing down things that some SKS that weren’t selling
well but but it was minimal compared to like the revenue we were bring and
not just in socks but then like I went and did that in you know 12 different
categories right and we’re all that’s what I mean by the way I have a few
pairs of those socks they’re very good very good socks both the athletic and
the dress socks should have worn them today anywa