Selling 15 Million/Year that You Can Get for Free!

He got the nickname, “The Badger”, because he was always battling guys bigger than him in his days playing basketball in North Dakota. And Scott Molander never lost that competitive spirit, even as he has moved onto great success in the business world.

He graduated from DSU in 1988 and “wanted to get out and see the world”, taking a job with Footlocker. His first job with the company was in Chicago. He freaked out when he got to his first toll booth outside of Chicago calling home to ask what you did at them. At his first day at an inner city store, when a customer asked him, “Is it ok if I take these shoes and come back to pay you later?” he didn’t think anything about it. His boss quickly set him straight that he wasn’t working in Crosby, ND anymore.

He quickly became retail savvy, moving onto running a store. He traded hats with other stores in the country, quickly taking his store from #1800 in hat wear to #63. But he got fed up with the politics of the big company, yearning to do something on his own.

He and another Footlocker employee, Glen Campbell also from a small town near Cape Girardeau, MO, decided that they should do something together. Glen was a great salesman and Scott was the finance and accounting part of the equation. They looked at buying a sports store franchise but finally Scott asked, “Glen what if we only did hats?” They developed a business plan, spent over a year shopping it to investors and finally got one of Scott’s former business professors from ND to assist them, raising $110,000 to start their first store on November 3, 1995 in Lafayette, IN. They did $110,000 in sales during that first Christmas season, often sleeping in the back of the store to save on the cost of a hotel. Someone with that type of dedication and willingness to sacrifice is a big step ahead of most.

Scott told some interesting stories of his start-up to the students at the DSU Entrepreneurship Conference. When he was thinking of quitting his job at Footlocker to start Hat World he went home to tell his parents. His dad’s reaction was, “You are going to quit your job and do WHAT? I can go down to the feed store and get a new hat every week, if I wanted one.” His future wife’s reaction when she met him two months after starting that first store, “If I were you, I’d keep my day job.” His mom’s reaction? She didn’t say a thing. She just wrote out a check so that she could be his first investor. Don’t you love moms?

His mom and those first investors didn’t do too badly either. A $2,000 investment became $80,000 when he and Glen sold the company last year for $177 million after it had grown to 500+ stores, doing $300 million in sales. At $20 per hat that is 15 million hats sold!

I traveled with Scott all over western ND for four days and here are some of my favorite quotes from him, “Our goal was to build a great company that was fun to work at. We weren’t focused on the money at all.” He still gets choked up talking about the “kids who joined him at Hat World. Now they have grey hair just like me.”

“Wal-Mart and others tried to go after us. They would come into our store, buy a hat and then blow up a photo of the receipt to show that they were selling their hats for $10 per hat less. We beat them on service, selection and training. Besides, who is going to go into a Wal-Mart to buy a hat? It is an impulse item.”

Today Scott is giving back to his hometown of Crosby, ND and to his alma mater Dickinson State University. My guess is that he will start another runaway success like Hat World in the near future.