In January, Ipath announced that it had been sold by parent company Timberland to KLONELAB. Following on the heels of that announcement, KLONELAB appointed former Patagonia executive Nate Smith as the brand’s new president to oversee operations out of its new Encinitas, California offices. We caught up with Smith to learn more about the deal, his goals for the brand, and how the sale will affect dealer partners.
Ipath President Nate Smith
Give us a little background on the sale of Ipath. Why did Timberland decide to sell to Klonelab? Did they shop Ipath around or did Klonelab approach Timberland?
At the end of the day, Timberland is an outdoors and industrial footwear focused company and apparently wanted to realign their portfolio in that direction. Despite the growth IPATH had last year, it just wasn’t a fit.
Some of the KLONELAB team used to work at Timberland and there are a lot of crossover friendships there. When Timberland was first considering selling the brand, they were aware of what was going on with KLONELAB and thought we may be interested in taking it on. The timing matched perfectly and KLONELAB was able to ensure a smooth transition for the brand as well as the shared vision of IPATH and its management team.
Klonelab’s core business is on the sandal and open toe side of the footwear market. Was this acquisition a move to round out the company’s portfolio with skate shoes?
I wouldn’t say core necessarily, but it is where KLONELAB had its start. KLONELAB always started out with the vision to be a boutique licensing house with a short term vision to eventually own our own brand. The skate segment has a lot of potential and at the same time, it doesn’t compete with our current portfolio.
Collectively, the KLONELAB team has a pretty diverse background in sales, operations, design, and marketing with brands that range from Patagonia, where I worked for a number of years, to others such as Converse, adidas, Timberland, and Nike. What people have seen before with KLONELAB and their licensing work with New Balance and Warrior Sports were just the first two steps in the company’s initial growth.
When the opportunity arose to acquire IPATH, we saw a great brand we could really help grow-it gave us the chance to own and grow our own brand and KLONELAB is committed to helping us do that with the office here in California.
Why skate and not a less niche-ey type of sneaker? This demographic is historically hard to crack.
That’s the beauty of IPATH’s positioning in the skate space. Our focus is to expand our global awareness in the skate and skate lifestyle channels in both footwear and apparel. The skate segment is a hard place to break into, but IPATH is already there and on an upswing. From the product to our newly expanded skate team, things keep on improving and we see nothing but continued success.
What are the goals you’ve laid out for Ipath over the next couple years?
Overall, it’s about helping the brand continue its push forward.
IPATH has done great with the majors in the US and that will continue to be a focus for us. On the other side, we can’t forget the specialty retailers that really drive the culture and direction of the industry. IPATH had substantial growth in specialty last year and it is our goal to continue that. We are making great performance footwear for this channel and we need to continue to drive this messaging through the use of our skate team.
I have a background on the international side, an area where we had some really strong movement as well, and IPATH will continue to evolve there as we look for the right partners that share the same global vision of the brand.
How do you see Ipath’s direction changing under your leadership and its new owners?
At this point, I don’t really look for a directional change from IPATH, more like course corrections. I keepmentioning growth, but growth has been there in many domestic and international markets already. In the markets we’re not growing, I’m going to look deep and aim to fix whatever issues there are. We want to continue to push forward with the momentum that the brand is currently experiencing, while taking a close look at where we’re challenged – and working to meet those areas head on.
Will you focus on a broader market than simply skate with your background in international development?
IPATH has been fortunate enough to have crossover appeal to the skate and lifestyle consumer. Because our DNA is born out of skate, it is important to always recognize our roots in both product design and marketing. Because we started using eco-friendly materials before it was the trendy thing to do, we’ve been embraced organically by consumers who favor the use of environmentally low impact materials or live an eco-conscious lifestyle. The unique shoes like the Cats have also gone a long way with crossover markets.
At the same time, we’re already active in other places outside of the skate world. IPATH has a tight team of legit, well-respected BMX riders who fully back the brand and we’re seeing a great return from them. We have pros from other areas on flow too, so while we don’t have an official snowboard team per se, it’s not rare to see guys from that world wearing IPATH gear when they’re off the mountain.
Patagonia’s focus on sustainability is legendary and Ipath’s focus in this arena is very strong. What can we expect from the brand along these lines with you at the helm?
We’re going to continue in a very similar direction as what you’ve seen. Use of hemp when and where it makes sense. Sourcing leathers from silver rated tanneries and continued research into recycled materials will also be a focus.
What benefits can retailers expect from the updates at Ipath?
More attention. Operations is going to catch up with marketing and product, so when the team comes through your town for a demo or we get a new pro that everyone is excited about, we’ll be able to support that spike in interest.
Where will the new offices be located in Encinitas and why have you moved there?
You probably have never been to the Torrance office! The original office worked for a certain period in IPATH’s history, but not any longer. An office change for IPATH had actually been in the works for a long time, even before we came on board.
Having worked for Patagonia, Ventura was always a great destination for retailers, athletes, and employees. Encinitas made sense for all the same reasons. You can skate or surf any day of the year and the energy is great here. Start fresh in a new location, near some of the mags, near key retail partners, and where there’s a strong skate scene. Being in Encinitas, there’s an opportunity for us to be a bigger part of the skate community and the So-Cal culture.
The new office is on 2nd Street in Encinitas. We’re still in the process of getting settled, but when it’s ready we’ll definitely let you guys know.
You’ve kept most of the staff the same with the transition. What do you see as the pros and cons of doing this with a leadership change?
The guys coming with us have been integral to IPATH’s growth and I’m excited to have them on board. Being the new guy in the equation, it is important to ease myself into it. From our history, we create our future. If there were problems before, I want to hear about it. I want to know what wasn’t working… since it wasn’t under my direction, I can’t take offense to anything and everyone can be open with me.
At the Agenda show, I talked with everyone I could, including Nesser, Matt Rod, the reps, everyone. Anything that we change should be for the benefit of the brand and those involved that are sticking with the brand.
Anything else you’d like to add that we haven’t hit on?
We know what people think when a brand is acquired. We’ve read the message boards. But the reality is that IPATH is on an upswing and that’s going to continue. We just finished a tw0-day offsite with the skate team and did a deep dive with them. I would think all of them would agree we are continuing in the right direction with a vision to take IPATH to the top. We will invest in our team, our demos, and our marketing. The video will still come out and the first cuts look great. From what I’ve seen, the product has made huge leaps in the last eighteen months and the next round is really going to shake things up as we define our performance range and lifestyle segments.
If you support IPATH now or did in the past, keep it coming; and if you’ve considered the brand, give us a call, because now’s the time and it’s only going to keep getting better.