Thread International makes a business case for good

 

Ian Rosenberger is used to the word “no.” Early in his business, Thread International, the founder and CEO would pitch to people the idea of taking trash from the world’s poorest neighborhoods and turning it into fabric for big brands and would be laughed out of rooms.

But like other entrepreneurs, Rosenberger is tenacious. He doesn’t let “no” become emotional.

“You just have to get good at shrugging off the doubters. It really is about seeing where you want to go and putting one foot in front of the other,” he says.

While Thread is still in startup mode, recent victories are confirming what Rosenberger calls a business case for good. This past spring, Timberland debuted a major line of boots and bags that use Thread fabric.

Rosenberger didn’t set out to run a business in 2010 in the wake of the Haiti earthquake. He wanted to end poverty, but realized he could use business to solve issues. The more successful Thread is with its financial bottom line, the more impact it can have.

Today, Thread — and accompanying nonprofit Team Tassy — partners with entrepreneurs in Haiti and Honduras who collect bottles that are ground into plastic flakes. (The company also started a microloan program for its suppliers.) The flakes are then turned into yarn and fabric in North and South Carolina.

“The trick with that is to prove to companies that it’s within their best business interest to use your product. When you use materials that are good for people and the planet, it’s not just a nice-to-have; you’re literally making your product more valuable,” Rosenberger says.

Proving value

Rosenberger likes talking about value, more than price, but he realizes you need both in business.

“You have to compete on price. It’s there. It’s in front of you, and if you’re not in the ballpark, then you’re not even going to get the meeting,” he says.

If he can deliver Thread material at 10 percent more than other material, Rosenberger can prove the additional value. If brands use a material that’s better for the planet where the supply chain is transparent, people spend more time on the website, the e-commerce bounce rate decreases and customers will be more loyal.

“There’s a 15-second window at the end of the buying process, where if you can show a customer — after they’ve decided that it looks good and it’s the right price — that they can do it guilt free, just by buying that product they’re doing something good for somebody else, that’s the competitive differentiator,” he says.

Now that Thread has worked with a national brand, the next hurdle is scaling up.

“When you’re a startup CEO, for a while, you are terrified of not having any customers,” Rosenberger says. “Then all of the sudden, you’re terrified of having them.”

After Thread first pitched to Timberland, for example, the team wasn’t sure it could deliver the fabric for the boots on time.

“We spent four months trial and error-ing, praying and hoping by the skin of our teeth, convincing vendors to run a couple hundred yards of fabric at a time, so that we could get what we needed to Timberland under the deadline,” Rosenberger says.

The company has big plans to appeal to consumers who are tired of commodity manufacturing.

“We’re called Thread because I believe that we’re all connected. There’s a thread that runs through all of us,” he says.

Rosenberger just took a trip to Asia to explore new sourcing, such as helping a yoga brand create products from trash in India, Indonesia or Bangladesh, the ancestral home of the practice.

“I love origin stories, and I think if you can tie the origin story of a good back to an area of the world that resonates with the customer, you can create an even more valuable good,” he says.

Learn as you go

Rosenberger’s great-grandfather, grandfather and father all ran small businesses, and like them, he’s learned as he went. As the company grew to 18 employees, it required more strategy, competence and discipline. Rosenberger compares it to going from a one-car road trip to a road trip with three cars.

“Just about the time I figure out in a particular stage how to be a good CEO, it tends to change again,” he says.

Luckily, he’s attracted people who have worked at bigger brands.

“It helps when you have somebody that understands the spreadsheet in a way that makes my gut come to life,” Rosenberger says.

It’s been challenging to learn how to execute everything that needs to be done, while maintaining the inspiration it takes to run a disruptive business. Keeping that inspiration at the forefront is why Thread became a Certified B Corporation.

But figuring out how to put the pieces together also makes it easy to get up on Monday mornings, he says.

“You get punched in the face over and over and over again, and you get knocked down — the only thing we know how to do is to get back up,” Rosenberger says.

“Being a startup entrepreneur is like brief moments of pure elation surrounded by long stretches of pure terror,” he says “I wouldn’t give it back for anything in the world. I’m so proud of the process and the experience.”