How To Make $932.77 Million With One Really Whacky Idea.
This is a "how to make a million dollars story" on steroids. Many amateur inventors dream of creating a million-dollar product in the garage, but usually the only thing that ever comes out of that garage is the family car. Roger Adams, the creator of a new kind of skate-shoe, beat the odds.
Mr. Adams founded Heelys Inc., a Carrollton, Texas, company that makes sneakers that work like skates when the wearer shifts weight to the heels. The company has sold more than 4.5 million pairs of Heelys, as they are known, world-wide since they debuted in 2000 and they keep rolling: In the six months ended June 30, 2006, sales rose to $44.6 million from $16.1 million a year earlier.
Born in Tacoma, Wash., in 1954, Mr. Adams was surrounded by skating from the start. He worked at the roller rink his parents owned, repairing skates and manning the check room where patrons stored their street shoes. From an early age, he invented quirky homemade devices, inspired by James Bond movies. In junior high school, he used the center of a flash cube to fashion a ring that temporarily blinded people when they bent down to view it. Later, he designed sound and lighting systems for skating rinks, helping pay his way though college. His family expected him to move into the family roller skating business. Instead, he took a detour.
He was working as a mental-health supervisor in Oregon in the 1990s -- "I was a counselor to other counselors," he says -- when he became disenchanted with the bureaucracy involved. Around the same time, he says, his marriage of 21 years to his college sweetheart "began to dissolve." He quit his job and moved away from his wife and three young children, looking for direction and inspiration.
In the fall 1998, he was sitting on a friend's porch in Manhattan Beach, Calif., watching roller skaters, skateboarders and bicyclists on the boardwalk, thinking back to a "happier, simpler time" at his family's roller rink. That led him to an idea. "It occurred to me that all those things -- roller skates, skateboards, bikes -- had been around for a hundred years," he says. "It seemed to me that there had to be some new way to have fun on wheels."
His friend had a workshop in his garage. He heated up a butter knife and began cutting apart some Nike sneakers and experimenting with metal balls and wheels. He "cannibalized at least four pairs" of sneakers in the first few hours. He tried them repeatedly and kept falling until he accidentally discovered the proper stance -- one foot in front of the other to maintain balance.
"I had a concept. I wanted the wearer to be able to walk normally and then roll," he says. "There is a stealth nature to Heelys. When you see a kid wearing them, you wouldn't know there's a wheel in the sneaker until they started to roll."
Mr. Adams quickly decided he had a product to sell. He spent all the money he had, $150,000, on pushing the project forward. Much of the money went to legal bills to get a provisional patent for his skate-shoe, and the rest went to product development. He also took a job selling cars at a Ford dealership to make ends meet. "I'm not a betting man, but I felt that I had a horse that was sure to win," he says.
Mr. Adams now holds a number of patents relating to the skate-shoe, including the idea of placing a single wheel in the heel and the stance the wearer takes (feet one in front of the other, toes up and heels gliding).
He took the prototypes to seven different shoe companies and six sporting-goods companies, but none of his meetings resulted in a deal. Finally venture capitalist Patrick F. Hamner offered funding. Heelys was incorporated in May 2000 and had an initial public offering in Dec. 2006. The company now has a market capitalization of $932.77 million.
Not everyone is high on Heelys. There have been reports of users having serious accidents while wearing them. World Against Toys Causing Harm Inc., a Boston watchdog group, placed Heelys on its annual "10 Worst Toys" list in 2006, saying the wheeled shoes could lead to injuries.
"Safety is Heelys' top priority and so it's important to recognize that our wheeled footwear is sporting equipment and not a toy," Heelys Chief Executive Mike Staffaroni said in a statement. "Like any other recreational sport, wheeled footwear should be used with the appropriate gear."
Mr. Adams says he has happily ceded the managerial aspects of Heelys to others. He considers himself the company's "chief tinkerer" and maintains a work space at Heelys that he calls the "Lunatic Lab" where he works on inventing products. "For me, innovation isn't a team sport, or something that's done by proxy," he says. "It's a personal obsession."
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