Startup Lessons from S’well Founder Sarah Kauss

By Micah Rosenbloom

Recently, S’well bottle founder and friend Sarah Kauss met with our portfolio and shared brilliant advice. There were three bits in particular that we wanted to share with a wider audience:

🚪 Search for “side doors”
👩‍⚖️Your brand > Your legal budget
🌷Push Up to Push Out

Background: This interview is a good overview of Sarah’s journey from accountant to entrepreneur and how she redefined a commodified category and built a $100M+ business in the process. Please give it a listen!

🚪 Search for “side doors”

Sarah wanted S’well to be an aspirational, fashion-forward brand. Celebrity endorsements are a proven way to generate buzz, but the self-funded founder couldn’t front the $150K/post fee influencers demanded. So she targeted makeup artists instead…

Makeup artists have some of the most influential celebrities in the world in their chairs for hours every day. The aesthetician’s counter is prime real estate and parking a S’well bottle there essentially serves as a billboard, piquing the interest of the A-list.

The beauticians were supplied with extra bottles to regift to celebs who asked about the visually appealing vessels, and many ended up in unpaid appearances in their social feeds. Sarah scored millions of dollars of free exposure in exchange for SWAG to the right influencer.

This high-class product placement is a hall of fame startup marketing move. Your product may not have a clear celebrity tie-in; the underlying creativity of looking for “side doors” or atypical approaches to customer acquisition is an idea every founder should drink in.

👩‍⚖️ Your Brand > Your Legal Budget

S’well’s beautiful designs and even more impressive growth spurred copycats from the earliest days. Sarah pursued counterfeiters through the court system but found cease & desist letters had little effect.

Passionate plagiarists would spin up new shell corps after losing a lengthy, and expensive for S’Well, legal battle. The solution was to reinvest in brand — new products, new channels, and top-shelf customer service.

Sarah said fans of S’well were surprisingly one of the best lines of defense, and they’d chastise retailers who stocked knock-off competitors. While rip-offs could feel like death by a thousand paper cuts, the investments in brand-building paid off.

Copycats are just as big a problem in B2B software as they are in bottles. Worse, derivative startups in tech often out raise/outspend the category originator. The lesson here is not to get distracted by fundraising/legal fights and focus on growing a loyal customer base.

🌷 Push Up to Push Out

Today you can buy S’well bottles almost anywhere from high-end fashion boutiques to home improvement big box stores. But that wasn’t always the case. In the early days, Sarah purposefully kept her focus on one customer — fashionable women.

As time passed, Sarah found that the average customer bought ~5 bottles. Eight seasonal collections of designs each year helped boost sales, but often the extra purchases resulted from a spouse/child permanently “borrowing” a bottle, creating new types of customers.

International expansion soon followed. Sarah worked with distributors to help fine-tune the marketing message that would resonate in each geo, with differing levels of focus on sustainability/fashion messaging and locally appropriate packaging.

After years of building trust, expanding the types of customers served, and expanding geographic reach, S’well grew into other categories, including food storage and barware. But none of this would have been possible without a singular focus in the earliest days.

These three lessons barely scratch the surface of Sarah’s startup wisdom, and I highly encourage you to learn more about Sarah’s entrepreneurial journey:

📰 Text

📺 Video

Sarah is also continuing to innovate and has recently announced a new program called GroundS’well a sustainability-as-a-service platform designed to help brands eliminate plastic waste from their product offerings.

And if you are a founder immersed in the next great entrepreneurial opportunity and need funding to unleash a torrent of innovation, please reach out to contact@foundercollective.com.

Our mission is to be the most aligned VC for founders at seed. #ProudInvestor in @Uber @TheTradeDeskinc @Buzzfeed @Cruise @Diaandco @PillPack @SeatGeek & more.