SmartWool

www.smartwool.com

Steamboat Springs, Colorado

Founded: 1999

A subsidiary of VF Corporation

Employees: 95

An industry innovator, the company reincarnated a classic outdoor material in bold new ways. Now it's finding new ways to make it work with other materials.

SmartWool started as a search for a better ski sock. In the mid-1990s, ski instructors Peter and Patty Duke were fed up with socks that left their feet soggy and cold after a day on the slopes, explains Mark Satkiewicz, the company's president.

They went on the hunt for a better material and came across merino wool, which was then a less expensive wool from New Zealand. They were able to harness the beneficial properties of wool -- it's insulative, even when wet, and moisture-wicking -- to create a technical sock while eliminating wool's biggest issue: itchiness.

However, at about $20 a pair, the socks weren't cheap. "In 1995, the founders went to Outdoor Retailer Market and were almost laughed out of the building," Satkiewicz says. "Nobody wanted to spend that much on a sock made out of wool."

The Dukes believed in the socks and gave away freebies, telling recipients to order more if they liked them. They did just that. "Enough people felt it was something different and good," Satkiewicz says.

Today the company's products are in 6,000 stores in more than 45 countries. As of 2015, about 75 percent of SmartWool's products are socks.

"SmartWool is known as one of the top 25 innovations in the outdoor industry for the past 50 years in regards to what we did for socks," Satkiewicz asserts. "We effectively crafted a whole other use for that fiber -- a premium use."

To manufacture, the company works with sock mills in the Southeast. "We make 95 percent of our products in the U.S.," Satkiewicz asserts.

The SmartWool products that aren't made in the U.S. -- though still designed in Boulder at its product development center -- are its growing line of apparel.

"We got into the apparel business because we were onto something on the sock side and consumers had a passionate connection to the brand. We felt that merino fibers translated really well next to skin in a base layer and we started manufacturing apparel in 1999. Now we have a really strong position in base layer and merino-based products across the world," Satkiewicz says.

The company has pushed beyond baselayers as well. The company now produces mid-layers, lifestyle products like sweaters, running clothes. "We want to make sure the consumer has a SmartWool solution for every day of the year," Satkiewicz says.

That's required some changes in thinking at the company. "For many years, we thought the right answer was just merino in apparel. Our team was little mesmerized by what wool can do," Satkiewicz acknowledges. "Today, we're SmartWool, but we really want to emphasize the 'smart' part of our name. We're using merino in the right places and we're using innovation on fabrics and yarns in the right way so the solution for the consumer is best."

When the company began its expansion into apparel, it was still privately owned. Timberland bought SmartWool in 2005, then Timberland was acquired by VF Corporation in 2011.

That gained the company access to VF Corp. resources iand its leverage in global supply chains. But Satkiewicz attests that the company is still very much operated by SmartWool, noting that in addition to its design center in Boulder, its headquarters are still in Steamboat Springs.

Challenges: "Competition. We've got to continue to accentuate why we matter," Satkiewicz says.

Opportunities: "Apparel is a huge opportunity," notes Satkiewicz. "Raising awareness and getting people to understand what we do and who we are. Those things are significant."

Needs: "We continue to have to be able to figure out how to run as profitable a business as possible to invest back into it," Satkiewicz says. "We're 21 years old. We're not a startup anymore. We've got good planning and we've got to execute against those plans."