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2:01

Hey, it's Guy here. You know, we hear a lot

2:03

about pivots on how I built this, how

2:05

a simple change in perspective can

2:07

create a whole new opportunity.

2:10

And this made me think of a conversation I recently had

2:12

with Keenan Thompson, who's the longest

2:15

running cast member of Saturday Night Live

2:17

ever, 20 seasons. And I asked

2:19

him, what if one day, instead

2:22

of performing on SNL, you were

2:24

given the keys to run SNL?

2:26

You will definitely want to hear his answer.

2:28

Check out my interview with Keenan Thompson over

2:31

on my

2:31

other podcast, The Great Creators. Just

2:33

search for The Great Creators with Guy Roz

2:36

wherever you listen to podcasts. And

2:38

now, on to today's show.

2:44

You're

2:44

selling one product, it was a black

2:47

yoga mat that was, it was

2:50

designed to be the one yoga mat you will ever

2:52

need to buy.

2:53

Yeah,

2:54

as I started to ramp this business up,

2:56

I actually, a friend of mine

2:58

was a business consultant and I hired him.

3:01

I said, here's the business

3:02

model, an indestructible product,

3:05

lifetime guarantee. He said, you're

3:08

insane. There's

3:09

no built in obsolescence. There's

3:12

nothing. It's a dead end. Don't do

3:14

it. And I said, here's

3:16

your money. Thank you for the advice. And you

3:18

know, and then I moved on because I knew that it

3:21

was filling a void. There

3:23

was nothing like it.

3:25

There

3:25

was nothing like it.

3:33

Welcome to How I Built This, a show

3:35

about innovators, entrepreneurs, idealists,

3:38

and the stories behind the movements

3:41

they built.

3:45

I'm Guy Roz and on the show today, how

3:47

Peter Sterios discovered yoga

3:49

in college, then grew it into

3:51

a passion and a business with Manduka,

3:54

a now multi-million dollar

3:56

yoga accessories brand.

4:03

So let me start with the elephant

4:06

in the room. Yes, I'm

4:08

a bit under the weather, but the show must

4:10

go on, so bear with me through this introduction.

4:13

I did the actual interview you will hear before

4:15

I came down with this cold, so it should sound

4:17

just fine. Okay, on to

4:20

today's topic. Yoga.

4:23

Yoga is big business. Brands

4:26

alone spend more than $12 billion

4:29

a year on yoga-related activity.

4:32

Brands like Lululemon and Athleta

4:34

and Alo have built entire businesses

4:37

on it. And by the year 2025, the

4:40

total value of the global yoga industry

4:43

will exceed $200 billion. Not

4:46

bad for a once obscure Indian

4:49

practice that was popularized in the West

4:51

by BKS Yengar in

4:52

the 1960s and 70s. Today,

4:56

yoga is far and away the most

4:58

popular form of group exercise in the

5:00

US. But up until around 20 years

5:03

ago, when it was just starting to explode,

5:06

most people who did yoga wore sweatpants

5:09

or aerobics gear. That

5:11

is, until an entrepreneur named Chip Wilson

5:13

saw an opportunity to sell them yoga-specific

5:16

apparel. He founded Lululemon.

5:19

And if you haven't heard that episode of How I Built This,

5:22

it's worth scrolling back to find it. Anyway,

5:25

another problem in the earlier days of yoga

5:27

was the quality of yoga mats. But

5:30

in the mid-1990s, a man named Peter Starius

5:33

noticed a visiting yoga teacher using

5:35

something different. Peter was living

5:37

in San Luis Obispo in California. He

5:39

was an architect by trade and

5:42

also a faithful practitioner and teacher

5:44

of yoga. In fact, at one point

5:47

in his life, Peter studied in India

5:49

with the great BKS Yengar himself.

5:52

But we'll get there. Anyway, that

5:54

day,

5:54

Peter noticed his teacher had

5:56

a mat that was thicker, more

5:58

durable, heavier, and thicker. and with a better grip.

6:01

Now, it's very likely that if Peter could

6:04

have easily bought a mat just like

6:06

it, we wouldn't be telling you the story

6:08

of Manduka, a brand that today

6:10

is one of the best-known manufacturers

6:13

of yoga mats, accessories, and clothing.

6:16

But at the time, it was very hard

6:18

to buy that mat. The

6:19

materials it was made from were actually

6:22

for an entirely different purpose. And

6:24

here's the hint. Think professional

6:27

sports stadiums. Anyway, that

6:29

one encounter with that special

6:31

material would prompt Peter to leave

6:34

his full-time job as an architect and

6:36

start a business selling yoga mats. He

6:39

built his business up slowly but consistently

6:42

by targeting what he calls yoga stars,

6:45

the best-known yoga teachers in America.

6:48

And it turns out, they loved his yoga

6:50

mats and happily promoted them. Peter

6:53

grew up in a middle-class family in

6:54

Fresno, California. He first

6:57

discovered yoga at college in San

6:59

Luis Obispo, where he studied architecture.

7:01

He was an avid athlete at the time, basketball,

7:05

swimming, weightlifting. But even

7:07

as a young man, he was starting to

7:09

develop some issues with chronic pain.

7:12

The pain that I was experiencing

7:14

was just the result

7:16

of long hours

7:18

leaning out over a drafting

7:21

table with drawings. And

7:24

just the crazy hours that

7:27

schools of architecture seemed to demand

7:29

of students, kind

7:32

of the bragging rights of how many all-nighters

7:34

have you pulled to get that project done. So

7:38

it was physical abuse,

7:40

self-abuse in a way, to the 10th

7:43

degree. And it started

7:45

to take its toll on me, especially at 19.

7:48

I had severe arthritic

7:51

pain in my neck. You

7:53

were even diagnosed with moderate

7:55

arthritis in your neck. Correct. And

7:57

it was like a serious. enough

8:00

to get a specialist and say you've

8:02

got to make some change. I

8:04

mean, presumably this is like the late 70s,

8:07

presumably at that time. I mean, physical therapy

8:09

obviously has changed, but I'm sure you

8:11

were kind of given

8:13

like a regimen of physical therapy to do, but

8:16

this is like really

8:17

beef, obviously, when yoga is still

8:20

really fringe. Was there a connection

8:22

between your neck pain

8:24

and

8:25

coming across yoga or was that

8:27

just like totally

8:29

random? Totally random. I

8:32

was late. I'd been up till 4

8:35

a.m., went home, got a half an hour

8:37

of sleep, took off to

8:40

class that I was late to around 9 o'clock,

8:43

and there's this door propped open and

8:46

for the life of me, I have no idea

8:49

why I stopped, turned,

8:51

pulled the door open and walked in

8:53

a step to see what was going on.

8:57

And it was the craziest thing for a kid from

8:59

Fresno, no clue

9:02

of anything other than kind of sports

9:05

and family and friends to go into

9:09

this room full of women

9:12

and a female instructor

9:14

doing yoga with no context

9:17

for what I was seeing. It was like I was

9:19

on another planet. You had no idea what

9:21

these, and it was mostly

9:24

all women in this class. All women. All women.

9:27

And you had no idea. It was just like. None. What,

9:30

you thought this is interesting. I want to try it

9:32

because most of the people might just keep walking,

9:35

right? Yeah, I mean, I

9:37

was embarrassed actually that I'd walked in

9:39

while the class was in session. And

9:42

just right in the middle of the class, I

9:44

asked loud enough for the teacher to hear, what

9:47

is this? You know, and

9:50

in that moment,

9:52

it could have been kind of a difficult

9:55

situation, but the teacher turned to me

9:57

with kindness and said, it's

9:59

yoga.

9:59

Do you want to try, you know, like

10:02

putting me on the spot? And

10:05

I was embarrassed. I'm sure I was,

10:08

you know, turning pink and red in my

10:10

face. But when I looked

10:12

around the room and everyone

10:15

in the room, all the girls in the room were looking at

10:17

me and smiling, like encouraging

10:20

look on their faces. And I thought, hmm.

10:23

And in that split second, I said, sure, when's

10:25

the next class? And then

10:27

next week I showed up at this class

10:29

to do yoga. And that's

10:32

how it all began. Obviously

10:34

yoga has changed a lot. We're going to talk about that because

10:37

presumably this is like, I think people

10:39

probably just had towels on the floor or, you

10:42

know, wearing like aerobics gear or whatever.

10:44

But what did, what was that class like?

10:46

I mean, you know, you were

10:49

athletic, but yoga requires,

10:51

not requires, but it's over time,

10:53

you know, it's about flexibility and

10:55

stretching. Was it hard?

10:58

It was one

11:00

of the most difficult athletic things

11:02

I'd ever done. And so for

11:05

me, I, a good

11:07

day bending forward, touching my knee, kept

11:09

standing. That was it. That

11:11

was a good day. Yeah. That's a stiff

11:14

I was. So yeah, that, that first class was

11:16

the, took me to a level of

11:19

intensity, pain intensity that

11:22

I really had never experienced before. Yeah.

11:25

But the teacher could see that

11:27

I was kind of overdoing stuff. She came over

11:30

and gave me a few adjustments in

11:32

this one pose. And then

11:34

after that, the end of class, she

11:36

laid us all down on the floor for the final

11:39

relaxation and this

11:42

relaxation exercise that she did

11:44

was only two minutes long,

11:47

three minutes long. But where

11:49

I went during those three minutes,

11:52

I have no idea, but it

11:54

was like all the time. The pain in my neck was gone.

11:57

My mind was refreshed.

11:59

You know, I had hardly slept the night

12:02

before and I just

12:04

felt fantastic. So

12:06

I was hooked. Huh. Okay,

12:09

so you start taking

12:11

these classes and I guess when you graduate,

12:14

you eventually wind

12:16

up moving to Santa Fe, New

12:18

Mexico, right? And

12:20

you were able to get a job

12:22

pretty quickly, I think, like working with another

12:24

architect? Yeah. But

12:27

when the architect was ready to offer

12:30

me the job, he said there was one condition. And

12:33

I said, what's that? And he said,

12:36

you have to go out for the local rugby team.

12:38

And I'm looking at him going, first of all,

12:41

what is rugby? Had no

12:43

clue. And second of all, why

12:45

is this a requirement? It turned out he

12:48

was the captain of the rugby

12:50

team. And as I had mentioned- The

12:52

local like- Yeah. The

12:54

regional rugby team, exactly. All,

12:57

no one was getting paid. And

13:02

at that time I was still swimming, weightlifting,

13:05

and keeping myself

13:06

fit. And he saw me and saw, oh,

13:08

this is a rugby player in

13:11

the making here. And so

13:13

I said, sure, I'm happy to try.

13:17

And it turned out that I

13:20

loved it. It gave

13:22

me that kind of competitive adrenaline

13:25

rush that I was becoming

13:28

accustomed to having

13:30

in my life, either through rock

13:35

climbing or snow skiing, or

13:38

whatever it was, it got that

13:40

life force going in me. That

13:42

was what you were doing. So you were not doing yoga.

13:45

You weren't like taking yoga classes and

13:47

playing rugby. Well, actually

13:49

I was. So I

13:52

sometimes would leave practice

13:54

and go to the seven o'clock yoga

13:57

class at this studio, but I couldn't

13:59

tell.

13:59

anyone on my team that

14:02

was going to yoga, that

14:04

would have been kind of a

14:06

mistake with the

14:07

type of people that were on the rugby team.

14:10

So I kind of kept it hidden. But

14:12

you were not, I mean, but yoga was just, it was

14:14

like a side thing. It wasn't, it wasn't like

14:17

a serious focus for you. No, it was

14:20

cross-training. Yeah, yeah. As a matter of

14:22

fact, my goal with

14:24

yoga was to loosen my hamstrings.

14:27

That's how materialistic you

14:29

might say I was in those days. It's a perfect,

14:31

I think it's a perfectly reasonable goal as somebody

14:33

who needs to loosen his hamstrings would

14:36

say. Yeah. But you

14:38

were, I mean, you were,

14:40

had this job as an architect, you were on this rugby

14:42

team, and a few

14:44

years in, you wound up taking

14:46

a trip to

14:48

New Zealand, I guess initially to play

14:52

some rugby there, but you actually decided to

14:54

stay on. Like, you wound

14:56

up living in New Zealand

14:59

for like seven, eight years

15:02

teaching architecture, right? Right. And

15:05

I think it's fair to say a huge

15:07

turning point in your life happened during

15:10

that time. You bet this guy, Shandor

15:13

Ramiteh, and he's this

15:15

guy, he's still alive, I think, right?

15:17

Yeah. And he's a really influential

15:21

yoga teacher who kind of created

15:23

this type of yoga

15:25

called shadow yoga, I guess. Yeah.

15:27

Tell me about him. How'd you meet him? Sure.

15:29

So Shandor is

15:32

one of those powerful and

15:35

also controversial teachers

15:38

of yoga, Western teachers of yoga, who

15:41

lived at the time I met him

15:43

in Australia, and he would

15:45

come to New Zealand twice a

15:48

year. It was the first

15:50

male yoga teacher I had met after

15:52

at this point, I'd been practicing yoga

15:55

for about five years. It was amazing

15:57

because he was a great teacher. And he was a great

15:58

teacher. And he was a great teacher. He was an athlete,

16:01

I was an athlete, but he did

16:03

a yoga demonstration on the Friday night before

16:06

the weekend workshop that just

16:08

athletically was some of the most

16:11

incredible things I'd ever seen a body do.

16:14

Just pulling up into a handstand

16:16

with no wall to balance on and

16:18

just hanging out in a handstand like

16:21

he's sitting on the couch.

16:25

And so that was a curiosity to me. How

16:27

is this guy who's obviously

16:29

athletic and muscular

16:32

so flexible? I want to know

16:34

what his secret is. And

16:36

so the weekend was profound.

16:40

Literally that weekend was the

16:43

major

16:45

course change in my life.

16:47

This was around, what, like 1990

16:49

when you first met him? Yeah, early

16:52

90s. He is,

16:54

I think, originally from Hungary, but

16:57

he grew

16:59

up in Australia. And

17:02

he was like, as you mentioned,

17:05

he had served in Vietnam,

17:07

he was a veteran. So

17:10

you don't think like, oh, here's a yogi. That's

17:13

right. Yeah.

17:15

That's right. That's the paradox of him. He

17:18

was not only in Vietnam, he was special

17:20

forces in Vietnam for the Australian

17:22

army. And he saw

17:25

things that he never shared. And

17:28

I'm sure that he went through a lot of PTSD

17:31

before they even knew it was PTSD. And

17:34

he used yoga to create

17:37

balance back in his life. And

17:40

at that point, he'd been doing yoga since

17:42

he was six years old with his father. And

17:45

he

17:45

meets this master yoga

17:47

teacher in Pune near Bombay, Mumbai

17:50

now. And he studies

17:52

with this master teacher for 25 years. What's

17:55

the master teacher's name again? BKS Iyengar.

17:58

Oh, BKS I, okay.

17:59

Wow, like the Yoda of

18:02

yoga. Kinda. So

18:04

he was, I mean, he essentially goes to

18:06

the source, like one of the sources. He

18:09

comes back to

18:11

Australia and New Zealand and he's just doing

18:13

clinics, but you really,

18:15

you see this guy and you're like, wow,

18:18

I need to become his student. Yeah,

18:21

and so when it was time for me to leave

18:24

New Zealand after eight years, I told him that

18:27

I was going and

18:29

he said, I really think you should go to

18:31

India and meet Iyengar. And

18:35

I said, well, there's a three year wait list to

18:37

get into those classes. And he

18:40

said, don't worry about that. I'll write

18:42

you a letter, no problem. There's

18:44

an understandably

18:44

a three year waiting list to study with

18:46

Iyengar. That's right. But

18:49

Shandor kind of lets you skip the line because

18:52

obviously he was an important student of Iyengar's. Big time,

18:55

he's part of the family. He was family.

18:59

So I

19:00

show up at the Institute and I had written

19:02

a letter, but they- Is it the Iyengar Institute? Yeah, the

19:04

Iyengar Institute. And so the school

19:06

secretary

19:07

looks at me and he said, well,

19:09

we're closed this whole week because it's

19:12

Iyengar's 70th birthday. You're

19:14

welcome to come and participate in

19:17

the demonstrations and the lectures. So

19:19

it was really an amazing time to show up for the

19:21

first time. And the very last

19:23

day, there was an afternoon session where

19:28

all the major newspapers of India

19:29

and

19:33

international magazine photographers

19:36

and writers all showed

19:39

up for this special last program just

19:42

of Iyengar talking about his life of yoga. And

19:45

the first question is from a

19:47

reporter from Mumbai. Young

19:50

guy, probably 25 or 26 years old, and

19:53

he says, here's his question. Why

19:56

do you do yoga? Now,

19:58

Iyengar has a very interesting

19:59

story. just spent four hours talking about

20:01

why he does yoga and he

20:04

had this reputation of being really a fierce

20:07

demanding kind of person and

20:10

you could see on his facial expression

20:12

that he was angry by the simplicity

20:15

of that question. So as I'm

20:18

watching him all of a sudden his

20:20

face softens and

20:23

his answer is just as brief he

20:25

says I like the way it makes me

20:28

feel and he moved

20:29

on and so I realized

20:32

what he meant by that answer.

20:35

The obvious answer is like

20:38

most people's experience the first couple times they

20:40

go to yoga it feels fantastic but

20:43

there's a depth to that answer. I

20:47

like the way it gives

20:49

me more ability to

20:51

feel. I like the way it makes me

20:53

feel. What yoga does

20:56

is it makes you it opens you up

20:58

to possibility

20:59

and gives you this

21:04

sensitivity and intimacy

21:06

to feel where you

21:09

maybe are in a state of contraction

21:12

because of stress. So my

21:14

anger's answer was I like the way

21:17

it makes me feel I have now this heightened

21:19

ability to feel these

21:21

places physically that

21:24

I'm holding stress and that

21:26

has informed my life

21:29

as a yogi and frankly

21:31

it's also informed my life in

21:33

business.

21:34

But I mean did

21:37

you were you able to get into the program?

21:40

I mean did you I mean I

21:42

know that you would go back and forth for some time but

21:44

did were you able to

21:47

actually stay and

21:49

participate? Yeah so

21:51

on the last day of

21:54

this ceremony I

21:57

went to the school secretary and I said I Have

22:00

to leave tomorrow, but I'd really like to stay

22:03

and he said listen. I'm gonna

22:05

make an exception for you and yeah

22:09

Come back and see me again tomorrow, and

22:11

I'll have The right

22:13

permission let's say for you to attend classes

22:16

And so I showed up the next day for that first morning

22:19

class at 6 a.m. So

22:21

for six days a week

22:23

Monday through Saturday I was at 6

22:26

a.m. Yoga class which was two and a half

22:28

hours long Wow And then in

22:30

the afternoons I would I

22:32

anger had a personal library downstairs that

22:35

he

22:35

allowed students to go down and

22:38

use and so the Afternoons

22:40

were spent in the library reading and

22:42

then I would after reading it I would go up

22:44

and do my own practice and

22:47

that was for me that Year

22:50

of doing yoga six days a week

22:52

in India was what?

22:56

Transformed me you

22:59

know like it changed

23:01

my Intensity

23:03

let's call it I Joke

23:06

about this sometimes before I started doing yoga.

23:08

I was a type a or actually I

23:11

was a type triple-a you know like beyond

23:13

a and

23:15

What that year in India

23:17

did for me was completely? transform

23:21

that mentality of doing

23:23

and

23:24

in a way Reminded

23:27

me of the power in being

23:30

and being present in particular Did

23:33

you actually study with I

23:35

anger was he the teacher? Yeah,

23:38

so yeah, you got to know him a little bit. Oh

23:40

He would I

23:42

have pictures in my Album

23:44

of he would use me as a model sometimes

23:47

in the morning classes And he would

23:49

make adjustments on me because my body at

23:51

that point was pretty Pliable

23:56

and and so that was another one of those

23:58

moments where I felt privileged

23:59

in a way that I was being picked

24:02

to be a model. All

24:05

right, so you wind up staying

24:08

at the Young Art Institute for I think about a year.

24:12

And then you return to the US and come

24:15

back to San Luis Obispo, which

24:17

is where you went to college, and you

24:20

get a job there at an architecture firm.

24:22

And at this point, you're also pretty seriously

24:25

into, obviously into yoga practice. So I guess

24:27

what are people start to ask you to teach

24:29

like

24:29

to teach yoga to them? Yeah,

24:33

the word got out that I'd been to India.

24:35

And so people started like contacting

24:39

me and saying, Hey, when are you

24:41

going to start teaching? So I ended up, okay,

24:44

I'll rent this senior center, they

24:46

had a hall that we could do yoga in and

24:48

the city rented it to me. Wednesday

24:50

night, class 530 to seven and the

24:53

first couple weeks I had like eight, 10

24:55

people show up and it was nice. But

24:58

within a month, I had like 40

25:01

people showing up. And you would just it was just in

25:03

this community center and people just

25:05

like pay you 10 bucks. That's right. Yeah, 10

25:08

bucks.

25:08

Okay, 10 bucks. So, you know, making $400

25:11

to teach a yoga class and paying $30 rent. It

25:15

was like, yeah, let's do rent for

25:17

the over the hour or two hours at the center. Yeah.

25:21

So this this class kept

25:24

growing. And then

25:26

this one friend of mine said, Peter, it's

25:29

time you get a space, you know. And

25:31

I just happened to be walking downtown

25:34

San Luis and I walked

25:36

by this building and I looked upstairs at

25:38

this two story building, old brick building,

25:41

and it had these huge 10 foot

25:44

tall windows. So the ceilings up there must

25:46

have been high. And it turned out it was the first

25:49

Odd Fellows Hall in San Luis Obispo

25:51

that had been empty for 12 years

25:54

because of a leaky roof. And Odd Fellows

25:56

are like masons,

25:56

I think, right? Something like

25:59

that. But

26:01

it was 2,500 square feet and I thought

26:03

this is the perfect size for a yoga

26:06

studio. So the landlord

26:08

was skeptical because he said, what business

26:10

are you going to put up there? And I said, yoga. And he

26:12

says, what's that? You know, so it was that whole

26:14

kind of fringe thing. But he said, listen,

26:17

you're going to probably be out of business in six months.

26:19

So I'll just rent it to you for $400 a month.

26:24

And it was a hit. So

26:26

you were basically running

26:28

the architecture office, architectural

26:29

firm in the daytime. And then beginning

26:32

in the evening, you were teaching classes. Correct.

26:35

And on the weekends. This was your

26:39

life. Well, it

26:41

was part of my life. The

26:43

other part in those days was

26:46

that I started writing for Yoga

26:48

Journal.

26:49

And so I'm writing a monthly

26:51

column. At

26:54

that time I had been married for, I think,

26:56

two years. And then I

26:58

was also traveling

27:01

a lot as Shandor's kind

27:03

of, what would you call it, step in

27:05

when his

27:08

travel schedule was too busy to go

27:10

to all the places he got invitations for. You

27:13

were his protege.

27:14

I was his business manager. I

27:17

basically organized his calendars

27:21

in North America, including Canada and Mexico,

27:23

every year that he would come. And he'd

27:25

be in the States for

27:28

two months, usually, a month on the

27:30

road, and then three weeks at

27:32

my studio teaching intensives.

27:35

So one of the things I

27:38

remember when I first tried

27:40

yoga, maybe in the late 90s, was

27:42

how painful it was for

27:44

me to sit cross-leg as still is 25 years

27:47

later, but less so. But it was really,

27:50

in part, it was painful because the

27:52

sides of my feet, just on the

27:55

pressure on the floor, was

27:58

painful. And I would take two yoga mats

28:00

and I would stack one on the other and that gave me

28:02

a bit more cushioning because yoga mats were

28:05

like and to this day many are

28:07

still are like this they were just like these very thin

28:10

pieces of you know I don't know

28:12

they're made out of some kind of polystyrene

28:14

or something yeah. Just some

28:17

version of plastic yeah. And I guess

28:21

you

28:22

saw that Shandor

28:25

he was using a

28:27

different kind of mat that was not

28:30

the one that I'm describing it

28:32

was it was thicker was a little was a different material.

28:35

Yeah his mat that one year

28:37

he shows up at my house in San Luis Obispo

28:40

and he has this black mat and I go

28:42

what the heck is that and he said yeah it's

28:45

this black mat from Germany

28:48

and I said how do I get one. But what was different about it

28:50

it was thicker. Thick black

28:53

you know like yoga at that point

28:55

was still kind of new

28:58

agey and the colors tended

29:00

to be

29:00

pastels. Purple and yeah.

29:02

Yeah purple and pastel blue

29:05

and pastel green and blah blah blah. So

29:07

here's this mat that's double the thickness

29:10

two inches wider six

29:13

inches longer and heavy.

29:16

Standard yoga mats about a pound this

29:19

mat was seven pounds. So

29:22

here's what was revolutionary about

29:24

it it was a performance

29:26

mat a high performance mat. The

29:29

other mats were just carpet underlayment that

29:31

was better than nothing. This mat

29:33

was engineered as the backing for astroturf

29:37

to be durable and to have a certain

29:39

amount of stretch but not too much stretch

29:42

and a certain amount

29:42

of cushion but not too soft

29:45

not too cushiony. And in the

29:47

same factory that the

29:49

carpet underlayment was coming from out of Germany

29:53

they also made material for

29:55

astroturf. Under astroturf.

29:58

Yeah the underlayment for and

30:01

so it was the perfect, you know, accidentally,

30:04

it was the perfect composition

30:07

for a yoga mat. So you see

30:09

this mat that he has and you want one, and

30:13

how did you get, I mean, presumably you just ordered

30:16

one from the company?

30:17

No, there was no company. There was a guy

30:20

in Germany selling them out of his

30:22

garage. Because these were not made

30:24

as yoga mats. Correct. So

30:26

some guy was just having them cut

30:28

them up into like yoga mat length.

30:31

Exactly. And he was selling them as yoga mats.

30:34

Correct. His friends in and around Europe. And so

30:36

I said, Shander,

30:38

how do I get one? He says, here's Klaus's

30:40

phone number. His name was Klaus. Here's Klaus's

30:42

phone number. Let's call him. And

30:45

so we called him right there from my kitchen in San Luis Obispo, and

30:47

I said, Klaus, how

30:47

do I get one of these? And he says,

30:50

no problem. You know,

30:53

where do I send them? And I said, here's

30:55

my address. And he said, how many can I get? And

30:57

he said, well, it's not how many can you get? It's how

30:59

many do you need to buy for me to send them

31:01

to you? And I said, well, how many do I need

31:03

to buy? And he said, $25,000 worth.

31:09

Why

31:09

don't we come back in just a moment, how

31:11

that seemingly ridiculous offer

31:14

leads to a very serious

31:16

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33:56

Hey, welcome back to How I Built This.

33:58

I'm Guy Roz. So it's 1997

34:01

and Peter has just learned that if

34:04

he wants to get one of those thick black

34:06

yoga mats from Germany, he'll have

34:08

to buy a thousand of them, like $25,000 worth.

34:12

Because Klaus, the guy who makes them, isn't

34:15

looking for a customer. He's looking

34:18

for a business partner.

34:19

Yeah, well, he wanted a distributor

34:22

in the United States. He wasn't interested in shipping

34:24

from Germany. And I just felt

34:26

like this relationship was one of those moments.

34:30

He's offering me an opportunity to start a business.

34:33

And so from that moment, I thought,

34:36

okay, I've got a decision to make.

34:38

I'll get back to you. Yeah. Were

34:40

you still running the architecture office?

34:43

Okay. So you got that going. You're teaching

34:45

yoga. I had a yoga studio. I had an architecture

34:48

office. And I was remodeling

34:50

our house, major remodel, where we

34:53

were living out of a single bedroom with one

34:55

bathroom. And the rest of the house was gutted.

34:57

Got it.

34:58

And this guy's saying, the minimum order

35:01

is $25,000. So I'm

35:03

trying to understand from the end of that phone

35:06

call with Klaus in Germany, where he's like, you got

35:08

to order $25,000 to, I don't know,

35:10

maybe a week later, where you're like, okay, I'll do

35:12

this. What did you start... Tell me

35:14

about your thought process.

35:16

How do you connect the dots to him

35:18

saying you got to order $25,000 worth of it to you thinking, well,

35:21

maybe I can actually

35:23

sell these and make money off of this?

35:26

The thing about making money off

35:28

it was instantaneous, because

35:31

even in the short time in San Luis Obispo,

35:33

every student that saw his mat wanted one. So

35:36

all of a sudden, the wheels inside my

35:38

head were spinning. So

35:41

that was... It was more, where am I going

35:43

to get the money? And we

35:45

were remodeling our house, $80,000 in debt with credit card debt.

35:50

And the way I was funding the house

35:53

remodel was at a time when

35:55

credit cards had these things called convenience

35:57

checks, where you could get an advance

35:59

of 10...

35:59

to $20,000 for minimum

36:02

zero interest actually if you paid it off in

36:04

time. And so I just

36:07

thought, well, shit, I'm already doing all

36:09

these other credit cards. I'll

36:11

just get a few more 25,000. It's

36:14

two more credit cards and I'll just purchase

36:16

it and then worry about paying the cards off

36:18

when I need to worry about it. Yep.

36:21

All right. So you decide you're going to

36:23

get this cash advance and then use that

36:26

to buy the $25,000 worth

36:28

of yoga mats.

36:29

And then you would just...

36:31

Yeah. Presumably the plan was you would sell them

36:33

in your yoga studio. Correct. It's

36:35

a risk, but you have a pretty good idea

36:37

that you could sell them. You put the order

36:40

in and I have to assume it's going to take

36:42

a, I don't

36:43

know, a month or two before they get there.

36:45

That was in yoga mats or arrival.

36:47

Did you have a warehouse

36:49

or a place that they got to? I

36:52

naively

36:55

believed that I could

36:57

put the mats in

36:59

my garage. Just

37:02

the garage seemed big enough to hold a small

37:04

container with the mats. And

37:07

so I just figured I'd cross that bridge

37:09

when it happened. And sure enough, I overestimated.

37:13

And so I had to basically clear out everything

37:15

that was in my garage to make room for the mats.

37:17

They show up to your, what, like a UPS

37:20

truck or like, I don't know, a moving

37:22

truck? No,

37:22

a small container. A container. Small container.

37:24

Full of... And they just, like a

37:27

forklift, just like drops it on your driveway?

37:30

Yeah. They came

37:33

on pallets, 18 boxes

37:35

per pallet. The neighbor kid that I

37:38

hired would help me

37:40

move it into the garage, stacked floor

37:42

to ceiling. All right. So you get this

37:45

full shipment and you've got a

37:47

thousand yoga mats and so, but you have a yoga studio

37:49

so you can sell them there, but still

37:51

selling a thousand

37:52

just out of your studio,

37:54

I have to imagine would be hard. It

37:57

was impossible. It wasn't, it

37:59

was the...

38:02

When you start a business without a business

38:04

plan, you have this passion

38:06

that you can solve any problem. And

38:09

that was my mentality. That's the way I grew

38:11

up. That's what my dad taught me. That, you

38:14

know, problems are opportunities. That

38:16

was one of my dad's favorite things to say. And

38:20

so that's the mentality that I'll

38:22

deal with that when it happens. And

38:25

there are so many personal things that happened during

38:27

those times, including divorce,

38:30

that freed up space

38:32

in my house, where I could

38:34

use parts of the house for warehouse

38:37

as well. Yeah. So you were going

38:39

through a divorce and starting this business. And, I can't

38:43

imagine it was an easy time. But

38:46

what was the, I mean, the

38:49

name, Manduka, how did you, what happened?

38:52

Because they were just

38:53

pieces of material for Astroturf. So

38:56

how did you decide? I mean, it makes sense. You

38:58

wanted to differentiate them if there were going to be other

39:01

yoga mats. So how

39:03

did you

39:04

decide to use that name and to come up with

39:06

a logo and then to

39:08

brand them?

39:10

So because Shandor

39:13

introduced me to the mat,

39:16

I wanted to find a name that kind of gave

39:18

a little bit of acknowledgement to the

39:20

roots of the mat. And

39:22

so when I thought about words

39:25

that Shandor used, Sanskrit words

39:28

that might make a great word

39:30

for a yoga mat company, especially

39:33

a yoga mat company that has excellent

39:35

grip. And obviously

39:38

a frog came to mind. And

39:40

I thought, well, what's the Sanskrit word for frog?

39:42

And there was a word

39:45

called Becca. And unfortunately at that

39:47

moment, there was a company that was starting

39:49

to offer product called Becca Yoga Products.

39:53

And so that name was out. And the other name

39:55

was Manduka for frog. And

39:58

the reason I like Manduka,

39:59

And I realized that was it because Shander's

40:03

Hungarian. And when he says the word Manduka

40:06

with his Hungarian accent, it was

40:08

so funny to hear. It

40:10

was just this, my Hungarian accent

40:13

isn't very good, but Manduka.

40:15

And so

40:16

every time he would say that, I'd giggle and

40:18

it was subconscious. I don't know why I was

40:21

giggling. Sometimes he even called me on it. He's like, what

40:23

are you laughing at? Not so funny. And

40:26

so for me, yes, this is the

40:28

perfect word. And frog because

40:30

it was a grippy, like a, I

40:32

don't, yeah. Yeah. And then I

40:34

obviously did some research on the symbolism

40:36

of frog and it's quite an auspicious

40:40

animal, especially in yogic terminology.

40:43

And to me, that was really

40:45

a

40:46

perfect word for this

40:48

company. Yeah. I

40:51

have to assume that it was

40:53

clear in 1997 that even the yoga was growing. The

40:58

market in San Luis Obispo would have been too

41:00

small to kind of

41:03

get these sold there. So,

41:06

I mean, initially, I mean,

41:08

you were obviously, you'd studied with the Yengar. You

41:11

were writing for the yoga journal at this point and

41:14

knew some people, probably a lot of

41:16

people in the yoga community. How

41:18

did you just create awareness

41:20

about the product or this thing

41:22

that you were trying to sell initially? The

41:27

connections that I had through yoga

41:29

journal, there was a network

41:32

of what I call celebrity yoga teachers

41:35

that I was getting to know at these conferences

41:37

where we'd sit around and eat and I'd

41:39

meet, you know, some big names

41:41

in those days were already

41:44

making a hundred thousand a year as

41:46

a yoga teacher. So there

41:48

was money to be made there. And

41:51

I wanted to associate with those teachers and

41:53

I would go out of my way at these conferences to

41:55

kind of rub elbows with.

41:57

And they became my friends

41:59

in a way. And so that first shipment

42:02

came I gave 75 mats

42:04

for free to every celebrity

42:07

yoga teacher I knew Wow, you

42:09

gave it to them and said hey Try

42:12

this and when you say celebrity yoga teacher,

42:14

who who are you? What is it? Who's Baron

42:16

Baptiste? Wow,

42:18

Shiva Ray Shiva Ray

42:21

Patricia very famous yoga teacher. She Walden

42:24

Eric Schiffman in LA Eric

42:26

Schiffman who had massive follow-ins And

42:29

I have a funny

42:29

story about this guy Eric Schiffman

42:32

this last guy that I described in

42:34

the early days of orders and

42:37

all we had was an answering machine at our yoga

42:40

studio to take orders and This

42:43

pattern started showing up that on Monday

42:45

morning. I'd have 25 orders from Tulsa

42:50

or 25 orders from Oklahoma

42:53

City and I'm like what is going on

42:55

in these Midwest towns? And then

42:58

I realized I suspected

42:59

it was Eric and I checked his schedule

43:02

on his little Little

43:04

bit of web presence that he had in those days

43:07

and sure enough It was where he was teaching

43:09

weekend workshops And so he

43:12

was at the end we custom-built

43:14

Eric is six foot four We custom-built

43:17

him a mat that was a hundred inches

43:19

long instead of 72 inches long And

43:22

so he was an easy guy

43:24

for me to develop this relationship

43:27

with Because he was doing it for

43:29

free like he

43:29

was an influencer before Influencers

43:32

got paid and he was just and and and

43:34

these were also different because a yoga

43:37

mat was just like this

43:39

Afterthought but this was heavy Already

43:42

it was unusual like people probably noticed

43:44

them. Yeah notice these celebrity yoga teachers

43:47

using them. Yeah,

43:48

so In you

43:50

know the other thing that I'm curious about is in 1997

43:55

these were very expensive compared

43:57

to I mean yoga mat was like go target

43:59

or

43:59

or maybe not target them, but you go somewhere to get one

44:02

for like 20, 25 bucks. Oh, cheaper.

44:04

Cheaper. You get them for like 15

44:06

bucks. Yeah. And these were

44:08

like $60? $65 was the advertised price. I

44:12

mean, that is, you

44:14

know, already there. I mean, there's an

44:17

argument to be made that because the price point was

44:19

so high, it did attract attention, right? People are

44:21

like, well, how? If it's so expensive, it must be really special.

44:24

I think it worked. The

44:26

one, as I started to ramp this business

44:29

up, I actually, a friend

44:31

of mine was a business consultant and I

44:33

hired him. I said, listen, I want to hire you. I want to get

44:35

your expertise. Here's the business model.

44:38

And I said, an indestructible product,

44:41

lifetime guarantee, you

44:43

know, one color heavy.

44:45

He said, you're insane. Don't

44:48

do it. There's no built in obsolescence.

44:51

There's nothing. It's a dead end. Don't

44:53

do it. And I said, here's

44:55

your money. Thank you for the advice. And, you

44:58

know, and then I moved on because I knew that it

45:00

was filling a void.

45:03

I mean, for years, first

45:05

three years, I was the only

45:08

person in that space. Yeah. And

45:10

there was nothing like it. There was nothing

45:13

like it. And

45:15

I guess you, I mean, once

45:17

you started to see how people

45:19

responded to that first shipment,

45:22

you went to

45:24

Germany, you went to that factory

45:27

in Frankfurt that was essentially making mats for

45:29

Astroturf. But you

45:32

kind of what you went to them and said, hey, could

45:34

you actually on your line like

45:38

make me mat specifically

45:40

for

45:41

fitness and yoga? That's exactly what

45:43

we did. There were a couple, you know,

45:46

customer issues that we were starting

45:48

to see we had to address. One

45:51

of them was the weight that these mats

45:53

were heavy, which created some

45:55

problems for smaller people

45:58

like carrying them. And

46:01

we just worked with it in a way. We

46:04

didn't back away from it. We did eventually,

46:06

two years after we launched the black mat,

46:09

we came out with this alternative

46:11

mat that wasn't black and it was half

46:13

the weight. We also had a problem

46:16

with slipping. And so the

46:18

early mats weren't designed tactically

46:21

on the top surface to resist

46:23

sweat, to resist slipping. And

46:27

so I went on that

46:29

trip,

46:29

one of about six trips

46:32

to Germany over the years just to meet

46:35

and maintain relationship with. That

46:37

first trip was addressing weight,

46:40

color, and slip. Because it was

46:42

black and it was seven pounds

46:45

and if you sweat, it was

46:47

slipping. Correct. And

46:49

with that one trip, we solved all those

46:52

problems. And

46:55

I anticipated a problem that I

46:57

thought would be happening once they

46:59

started

46:59

to be used as studio mats by

47:02

creating a texture on the bottom surface

47:05

of the mat, which was this dot

47:07

pattern that you see in shower mats

47:09

and things like that, that helps the

47:11

mat stay put on a hardwood

47:14

floor or a stone floor. So

47:16

that was that first trip. It was a very productive trip.

47:19

And that was about a year in or less? About

47:23

two years in.

47:24

And now here's the thing. You

47:26

alluded to this a couple of minutes ago, which

47:28

is when you talked to a business

47:30

consultant in front of yours, which is you

47:33

were offering a guarantee. It was

47:35

designed to be the one yoga mat you will ever

47:37

need to buy. We weren't

47:39

offering the guarantee at the start, but

47:42

we had a tagline. The

47:44

tagline was

47:45

good for a lifetime or two. We

47:48

had this little or two lifetimes as

47:51

a joke. We didn't

47:53

explicitly do

47:56

the lifetime guarantee until about year

47:58

eight.

47:59

I mean, you were selling

48:02

a product that you knew most people

48:04

would only buy one of.

48:05

Correct. And in the late 90s,

48:08

you know, today it's a $40 billion

48:10

industry, but in the late 90s it wasn't. But

48:13

did you have a sense that

48:16

something was changing in yoga,

48:18

that it was starting to...

48:20

There was kind of like this boom happening?

48:23

The boom was definitely happening

48:26

in terms of the

48:28

growth of yoga studios. Yeah.

48:30

Because this is still pre-Lululemon, I think. It's

48:33

pre-Lululemon, yeah. So the

48:36

products, and especially the clothing products,

48:38

hadn't really in those days been

48:43

realized. So I

48:45

didn't know what the extent

48:48

was, but I didn't believe the

48:50

business consultant that it was limited.

48:53

I just figured that whatever

48:55

the United States is doing, it's going to track

48:57

internationally at some point. And

49:01

that's what's happened, that the

49:03

growth started happening in the strangest

49:05

of places, especially in Taiwan

49:08

or in Japan. And then I

49:11

realized that that's where Shandor teaches

49:13

in Taiwan and Japan.

49:15

And when he would be traveling with his map

49:17

there, people in Japan would say, where do you get them?

49:20

And he'd send them to us. So we

49:22

started to have, within three years, we

49:24

had an international business going as well.

49:27

And especially when we made those technical

49:30

adjustments to the grip and the textures,

49:33

it increased the price to 75,

49:36

but the performance

49:38

just easily paid for that

49:41

additional money. And

49:43

this is obviously pre-Instagram

49:45

influencers in social media

49:48

marketing. This is the late 90s, early 2000s. I

49:50

saw there's an ad that you put in Yoga

49:52

Journal, like a print ad, and it's just

49:55

like, this

49:55

is Manduka, and then it's just a list

49:58

of the most prominent.

49:59

yoga teachers and that presumably

50:02

an ad like that at the time would

50:05

have had a significant impact. Yeah,

50:07

the first week that ad ran

50:10

we doubled sales and then

50:12

three weeks later we're still doubling every

50:14

week our sales and it got to

50:16

the point where that first year

50:18

I think we were on back

50:20

order for three months out of 12 just

50:23

because we couldn't keep up and there was a two-month

50:26

lag time between the order and the delivery.

50:28

Well because you were probably a tiny part of this

50:30

Frankfurt factory, this German

50:33

factory's business, their main business

50:35

was Astroturf. Well it was carpet

50:37

underlayment and Astroturf, yeah exactly.

50:40

It was a huge factory and so the production

50:42

cost from Germany was high

50:45

but our

50:46

costs, our sales price

50:49

was high and we managed that and

50:51

we never sold the big box stores in the

50:53

early days. We tried to maintain

50:56

our studio relationships and

50:58

our individual retail customers

51:01

and big box was only a thing that came later.

51:04

And so what

51:05

I'm trying to figure out is because from

51:08

what I gather reading

51:10

about these early days was that you constantly

51:13

had cash flow issues like you were constantly

51:16

not able to make payments but

51:19

if they were like

51:20

flying off the shelves if you could not

51:22

actually, I mean

51:23

if it was just you know you were growing

51:26

like by a hundred percent every year what was going on was

51:28

it just you just weren't managing the business right? Well

51:31

the problem in those early days is

51:33

we didn't have a finance department.

51:36

We didn't have, it was me. It was just like five of

51:38

you. You wouldn't for what? I had I

51:41

had a warehouse guy, I had

51:43

a marketing gal, I had

51:45

an office manager who dealt

51:47

with customers and I had a kind

51:49

of an outside sales rep who was

51:52

basically a guy that just made

51:53

commission and would travel a lot and

51:56

we didn't really have anyone managing

51:58

the money yet.

51:59

Where we would get into trouble is when we

52:02

send a shipment to yoga works who

52:04

had at that time

52:06

You know beginning to have seven

52:09

eight franchise yoga works around

52:11

the chain Yeah, so and

52:13

they wouldn't pay us on time the

52:15

retail business was perfect But

52:18

the wholesale business would catch us literally

52:21

with our pants down sometimes and Then

52:24

then we'd have to hustle Yeah, because in the

52:26

early days I had to pay

52:28

half at the time of order

52:31

and half at the shipping

52:33

date So basically I had to pay

52:35

a hundred percent of that inventory

52:37

Before it even left Germany

52:39

or on the day that it left Germany because they

52:42

because obviously because your terms were not

52:44

gonna be great because I was a business

52:46

that was tiny yeah, and because the

52:50

as our orders grew the business was like The

52:52

factory was a little cautious like

52:55

what if we send all these mats, but

52:57

with track record

53:00

and a relationship from that first Visit

53:03

the second visit was how do we change

53:06

the terms

53:07

and so we changed it thing?

53:09

Yeah, thankfully 25% up front 25% when

53:13

it ships 25% after

53:16

the first month and the balance

53:18

after the second month and that allowed you

53:20

to basically

53:22

function sustainably. Yeah, that

53:25

was that was the key

53:29

When we come back in just a moment why

53:31

Peter eventually decides to sell

53:33

Manduka and how he then has

53:35

to learn To let go of it

53:37

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Life on Amazon Music or wherever

55:01

you get your podcasts. Hey,

55:10

welcome back to how I built this. So it's

55:13

the early 2000s and Manduka

55:15

is still just a five person company,

55:17

but it's starting to make some money and even

55:20

turn a profit. And after specializing

55:22

in just one product that heavy

55:25

black yoga mat, Manduka starts

55:27

to branch out first to lighter

55:29

weight mats and then to other yoga

55:31

accessories.

55:33

You know, bolsters, blocks, straps,

55:35

eye pillows, all sorts

55:38

of creative and useful tools. So

55:40

I went out and I sourced materials

55:42

that were organic cotton or whatever

55:45

it was. We even did some air

55:47

inflatable yoga bolsters

55:50

to experiment with lighter weight things

55:52

so students could travel with them. So

55:54

I just I didn't look at the

55:57

balance sheet, the spreadsheets and say, okay,

55:59

this is gonna cost too much to make. I

56:02

just said, this is a product that studios

56:04

need or individuals at home need. And they

56:06

all sold reasonably well.

56:09

Yeah. And so that was growing

56:12

the bottom line for us. We,

56:14

our international business

56:16

was growing, everything was growing, but

56:19

to that point where I could manage

56:21

it all, I was starting to see

56:24

something's got a shift. And

56:27

at the time, I mean, I think Gaia

56:29

or Guiam, I mean that, I

56:31

think which is the biggest, probably one of the biggest

56:34

yoga brands in the world was

56:36

already out there. Did you see companies like

56:39

that as like

56:39

a competitor or sort of like, we wanna

56:41

be like them or bigger than them? No.

56:44

No. I just looked at what my

56:48

intuition led me towards and also

56:50

what I was listening to studio owners and

56:53

friends of mine, what was needed, what was lacking.

56:55

And as a studio owner myself, what was needed

56:57

and lacking in my own studio?

57:00

I guess the other, I mean,

57:02

another thing that was going on while,

57:04

I mean, cause you start in Manduka in 97 and

57:06

you know, you obviously

57:09

you're selling one mat and then you start to have

57:11

the factory change the formula.

57:14

And then yours, you go to two mats,

57:16

sort of a lighter mat. Something else happens,

57:18

which is your

57:20

mentor, you know, this guy that you practice

57:22

with,

57:23

right? Shandor, I guess

57:25

at a certain point, he kind of

57:28

pushes you away. He says, you've

57:30

gotta go on, what

57:33

happens? Like, I mean, you're his student

57:37

and what he encourages

57:40

you to stop practicing

57:42

with him. What happened? So

57:48

after 20 years of being his student,

57:50

but also at 10 years as being his

57:52

North American business manager, you

57:55

know, the relationship was solid. He was the best

57:57

man in my first wedding, but.

57:59

I mean, there were signs

58:02

that things were changing and I was not

58:05

really paying attention to them because

58:07

I thought our relationship was solid.

58:11

What I see in hindsight now is

58:14

he realized in maybe

58:16

my personality something

58:19

lacking and this devotion

58:22

to the guru

58:23

and maybe it was even starting

58:26

from my Catholic upbringing there

58:29

was something

58:32

broken in that way

58:35

of relating to myself

58:39

and in a nutshell

58:41

I think what he gave me

58:43

is now what I consider the ultimate

58:46

gift because ultimately

58:49

in yoga and in business frankly

58:51

in a way we all have

58:53

that moment where

58:56

we confront

58:59

the let's

59:01

call it the inner teacher like who

59:04

knows what's best for our lives

59:06

it's not outside ourselves it's

59:09

within ourselves and if

59:12

I'd have listened on a business level

59:14

if I'd have listened to the advice that I was getting

59:16

from these experts I would

59:18

have never started Manduka and

59:21

likewise if I'd had been a follower of

59:23

Shandu for the last 20 years I

59:25

wouldn't be here talking to you I don't think to

59:28

be honest. But what explained

59:30

that

59:31

he I mean it seems odd I mean

59:33

he was mad at you for some

59:37

reason it's weird I don't know what

59:39

did you ever understand why he was angry

59:42

or? I don't see it as anger

59:45

but that state

59:47

of confusion

59:49

lasted for a

59:51

year maybe maybe two

59:54

because simultaneously I was

59:57

my wife had already left but the divorce wasn't

59:59

final.

59:59

Um,

1:00:01

my dog,

1:00:03

probably the only real friend at that time

1:00:05

in my life that I felt close to my dog

1:00:08

died unexpectedly from a brain tumor.

1:00:11

So you couldn't have piled in more

1:00:14

stress into a life and

1:00:16

still running all these other businesses and things.

1:00:20

Tell me what was going on in,

1:00:22

I mean, I know that you obviously

1:00:24

went through a number of really huge

1:00:27

challenges, the divorce and the

1:00:30

fallout from your, from the end of your

1:00:32

partnership and friendship with Shandor. And

1:00:35

then you had a kind of a

1:00:37

scary health diagnosis. I think it was a, was

1:00:40

it a tumor that was found? Yeah. It

1:00:43

turned out to be benign, but it was still scary.

1:00:45

Yeah. Must've been really scary. Yeah. It

1:00:47

was, it was one of those moments that,

1:00:50

you know, life can gift

1:00:52

you with if you, if you kind of make

1:00:54

it to that realization where

1:00:57

you

1:00:58

decide what's truly important. And

1:01:02

this is where my, you

1:01:06

know, at that point, 25, 30 years of yoga practice

1:01:08

really

1:01:12

overlaid into my

1:01:14

personal and professional life as a,

1:01:17

as a business owner. And that

1:01:19

was a gift from this diagnosis,

1:01:22

the diagnosis, which initially

1:01:25

was cancer. And it

1:01:27

turned out

1:01:28

after they removed

1:01:30

the tumor to be benign. And that

1:01:32

was after four years of treating

1:01:35

it holistically, naturally.

1:01:38

Well, yeah.

1:01:40

So all

1:01:42

of this is, is, is the backdrop

1:01:44

for a decision you make in 2007 to step

1:01:48

down as a CEO of your company, your business.

1:01:50

You didn't have, you owned it. It was yours. Were

1:01:53

you, I'm assuming you

1:01:55

were feeling just overwhelmed that you just

1:01:58

couldn't do it anymore. I don't want to run it

1:02:00

anymore. Once I made the decision

1:02:02

to sell, I didn't feel overwhelmed. But

1:02:04

leading up to that? Yeah. Yeah, of

1:02:07

course. It's like saying goodbye to a

1:02:09

child, you know? And

1:02:11

even to this day, guy, you know, like, Manduka

1:02:14

is still part of me. And yesterday,

1:02:17

I get this email

1:02:19

still from Manduka that's celebrating 25 years.

1:02:23

And they acknowledge me in the email,

1:02:25

which is just, of course, it's

1:02:28

part of me. Tell

1:02:31

me about the decision to sell. 2007, 2008, this is obviously

1:02:34

the beginning of the financial

1:02:36

crisis. Yeah. You guys hit

1:02:38

about two, two and a half million dollars

1:02:40

in sales. So you're still very

1:02:43

small, but I mean, fast forward

1:02:45

today, Manduka is this really big

1:02:47

company. Tell me

1:02:50

the motivation for selling. You were just tired,

1:02:53

you were just done. I

1:02:56

was at a crossroads and looking

1:02:58

at the second half of my life. And

1:03:01

at

1:03:01

the second half of my life, I wanted to be different

1:03:03

than the first half of my life. And the

1:03:06

fatigue wasn't so much the

1:03:08

issue as the quality of life.

1:03:11

And I made

1:03:14

the choice for quality of life over

1:03:17

some legacy of

1:03:20

corporate success. And

1:03:23

I, when

1:03:25

I made that decision, I had a sales

1:03:27

trip

1:03:28

down to YogaWorks and

1:03:31

I was talking to their buyer.

1:03:33

And I said, hey, by the way, if you

1:03:35

know anyone who wants to buy a yoga

1:03:37

mat company, I might wanna

1:03:39

talk to him. And the buyer,

1:03:42

who's this guy, you know, I

1:03:44

didn't know that well, said, well, actually

1:03:46

I think I know someone. And I go, who's

1:03:48

that? And he said, me.

1:03:50

And I laughed at him. I said, well,

1:03:53

that's wonderful, but I think I'm probably

1:03:55

gonna ask more and you can afford to say, oh,

1:03:58

well, I know people. And.

1:03:59

You know, I can introduce you

1:04:02

and I want to be a part of it and

1:04:04

that's how it started I didn't have to go find

1:04:06

anyone to go find someone. I just

1:04:09

Started in a yoga works warehouse

1:04:12

and eventually this

1:04:14

person Sort of organized

1:04:17

the the funding financing to buy it This

1:04:20

person introduced me to a venture group

1:04:23

in New York's channel stone partners,

1:04:26

right? And and so he made

1:04:28

the introductions and part of the introduction

1:04:31

like he didn't want to find your speed he just wanted a

1:04:33

job and he was the

1:04:36

COO chief of operations

1:04:38

for the new company. Well, so

1:04:41

basically it was a fairly quick acquisition

1:04:43

They I mean you sort of put out your price and

1:04:46

they agreed to it. No,

1:04:47

no It took

1:04:49

a year if from that moment in the warehouse

1:04:52

to the day we signed on the dotted line

1:04:55

and it was unbelievable timing

1:04:57

because a month after we signed

1:04:59

the whole economy collapsed

1:05:02

and

1:05:03

That was a bit worrisome for me

1:05:06

a little bit but um But

1:05:08

no, it was we negotiated over

1:05:11

a year and and they were New

1:05:13

at this and and there

1:05:15

was a little bit of haggling over price But

1:05:18

I I basically told them we were

1:05:20

under capitalized understaffed and

1:05:22

we still produced, you know Two two and

1:05:24

a half million in gross sales the potential

1:05:27

for me a little bit. But um But

1:05:30

no, it was we negotiated over

1:05:32

a year and and they were

1:05:33

New at this and

1:05:36

and there was a little bit of haggling over price

1:05:39

But I I basically told them we

1:05:41

were under capitalized understaffed

1:05:44

and we still produced, you know Two two

1:05:46

and a half million in gross sales the

1:05:48

potential for this company is 10 to 15

1:05:51

X what you're getting it for So and

1:05:53

they they said yes, we agree and

1:05:56

in the end that's how we

1:05:58

came to a price so

1:06:00

You signed an agreement with them to

1:06:02

stay on for, I think, five more years. Yes.

1:06:05

And in the press release from that time, you're

1:06:07

quoted as saying, you know, this

1:06:09

is great. We're going to maintain our core values. A

1:06:12

lot of, you know, we had to, these are the right partners.

1:06:14

They share my dedication to this vision. They have

1:06:16

the best interest of the company and our customers at heart.

1:06:19

And that's normal. You know, you see that in any acquisition

1:06:22

press release. Did that, was

1:06:24

that, did that come to fruition? Was that actually

1:06:27

how it

1:06:27

played out?

1:06:28

You know, appearances

1:06:32

and what actually is the

1:06:35

reality is sometimes quite

1:06:37

diverse. And I

1:06:40

would say that the first, I

1:06:42

mean, their first decision, which I was against,

1:06:45

was to move the company from San Luis

1:06:48

Obispo to Los Angeles. And

1:06:50

the reason I was against it was the quality of life

1:06:53

issues. And we had

1:06:55

this perfect working

1:06:57

model of what

1:06:58

I was concerned about, which was

1:07:00

Patagonia, where Chouinard

1:07:03

sold it to a venture group and

1:07:06

they moved it, I think, somewhere in Southern California.

1:07:09

And then he bought it back and moved the company back

1:07:11

to Ventura because it was close to

1:07:13

a beach break for all his

1:07:15

surfer employees. And he had a quality

1:07:17

of life for his employees that was more

1:07:20

valuable than the bottom line. And

1:07:22

so that track record of Patagonia

1:07:25

was fresh in my mind. And

1:07:27

I was saying, listen,

1:07:28

guys, yes, it's going to cut

1:07:30

costs for shipping and it's going to get

1:07:33

a bigger labor pool and bigger access

1:07:36

to customers. But I guarantee

1:07:38

you in another five or 10 years, San

1:07:40

Luis Obispo is going to be the place you want to have

1:07:42

your headquarters because you'll be able to attract

1:07:45

people here. And

1:07:47

they didn't listen. And that was kind of

1:07:49

the first heads

1:07:52

up for me that the press

1:07:54

release is one thing, the reality is another.

1:07:57

And within a

1:07:58

couple years of...

1:07:59

this employment agreement with

1:08:02

them, they would pay me to create

1:08:04

ideas and develop products and

1:08:07

then they would act without

1:08:09

any regard to my recommendations

1:08:11

and they learned some painful

1:08:14

lessons without even acknowledging that

1:08:16

in a way I was correct but at

1:08:19

the end of three years they stopped communicating

1:08:22

with me and the last two years of my

1:08:24

employment with them they paid me and they

1:08:27

never called me which is

1:08:29

the way it happens I guess sometimes yeah

1:08:32

but the brand has definitely

1:08:36

strived to present

1:08:39

itself as honoring

1:08:42

its roots and the

1:08:44

different generations of owners I think

1:08:46

there's been four generations of different

1:08:49

venture capital groups now they've

1:08:52

all

1:08:52

in their own unique ways tried

1:08:55

to maintain that reputation

1:08:58

of Manduka

1:08:59

you know I I'm curious what

1:09:01

you make of where yoga

1:09:04

is now because it's it is what

1:09:06

started out at least in the West as a sort

1:09:09

of hippy-dippy spiritual thing it was

1:09:11

you know I think first came

1:09:13

to the u.s. in the 20s or something like one of the world's

1:09:15

fairs and then you know

1:09:16

really kind of

1:09:18

kicks kicks off in the Bay Area

1:09:20

San Francisco in the 50s and today

1:09:22

it's not I mean it is a

1:09:24

massive part of the fitness industry

1:09:27

is a is a I mean

1:09:29

in 2016 it was like 17 billion dollars

1:09:31

in the US alone so the global

1:09:34

I think the global yoga markets like 40

1:09:36

billion dollars and that's like

1:09:38

that's a significantly huge market

1:09:41

and you're talking about it's not the beauty industry

1:09:43

but it's like it's really big and

1:09:46

you know the things that Manduka

1:09:48

sells the accessories and those Lululemons

1:09:51

and all the other brands out there that have really

1:09:53

become multi

1:09:56

you know million billion dollar businesses on

1:09:59

the back of this

1:09:59

what originally began as a spiritual

1:10:02

practice in rural India. I

1:10:05

mean, of course it's inevitable. It happens

1:10:08

with so many things, but I don't know, do you have mixed

1:10:10

feelings about that?

1:10:12

I don't. I mean, I

1:10:14

played a major role

1:10:16

in that, you know, corporate

1:10:19

transition of the traditions

1:10:23

of yoga into a Western environment.

1:10:26

And I

1:10:27

felt my place was

1:10:30

part of a lineage of innovators to

1:10:33

make yoga more accessible for people

1:10:35

with bad ankles on the floor,

1:10:38

you know, bad knees on the floor, whatever,

1:10:42

to be able to get down to the floor

1:10:44

and practice yoga and then stand up

1:10:46

and feel safe with balance and

1:10:49

stability. So the legacy

1:10:51

of Manduka is that it was built

1:10:54

by yoga teachers. I didn't have a sales

1:10:56

department until year

1:10:57

six, I think. So

1:11:00

to me, that was something

1:11:03

that I, to this day, feel really good

1:11:05

about.

1:11:07

As you sort of recount your story

1:11:10

and where, it's quite

1:11:12

a story, right? From Fresno to Santa Fe and

1:11:16

New Zealand and Pune, India

1:11:21

back to San Luis Obispo, and

1:11:24

this brand that you built, that you created, it

1:11:27

is now one of the biggest brands in

1:11:29

yoga. How much of where

1:11:32

you are today do you attribute to

1:11:34

how hard you've worked and how much

1:11:36

do you think has to do with just chance and luck

1:11:38

and

1:11:40

just serendipity, coincidence?

1:11:44

I would say the

1:11:46

title of my book is Gravity and Grace.

1:11:49

And, you know, everyone has

1:11:51

a relationship to this word, grace, whether

1:11:53

it's a spiritual or a

1:11:56

religious meaning, or just,

1:11:58

you know, appreciating nature.

1:11:59

you know where we feel this non-physical

1:12:03

connection to things or

1:12:06

energies etc. And yeah, and

1:12:08

I want to maybe finish this with

1:12:10

a story

1:12:12

about nine years

1:12:14

ago, I was in

1:12:16

Spain in

1:12:17

this little fishing village called Cateches

1:12:20

on the eastern coast of Spain and

1:12:23

so I took a train up the coast and

1:12:25

then I drove to this little village and

1:12:27

I get terribly lost and

1:12:30

now I'm starting to worry because the rental

1:12:32

car to get back to the train station I can't

1:12:35

remember where I parked the car. So

1:12:38

I'm standing in this maze there's

1:12:40

people and merchants and little shops

1:12:43

and I Look down right

1:12:45

at the window of the shop and here's a manduca

1:12:47

sticker on the inside

1:12:50

of the glass And I'm

1:12:52

like, oh my god. I

1:12:55

The doors locked I look in and

1:12:57

it's this tiny little yoga studio

1:12:59

and that

1:13:01

feeling of being lost

1:13:04

and then having this

1:13:06

little logo that I Drew

1:13:09

on a napkin in a restaurant,

1:13:12

you know, how many years ago that

1:13:14

frog

1:13:15

frog I drew that

1:13:17

frog on a napkin and that

1:13:21

frog symbol has survived,

1:13:24

you know for venture capital groups and

1:13:27

I'm seeing it in some little village in Spain

1:13:30

that that to me is Such

1:13:33

a gift to my life

1:13:36

That's

1:13:36

Peter stereos founder of

1:13:38

Manduca By the way, even though

1:13:40

he fell out of touch with his former

1:13:42

mentor Shandor remit a they

1:13:45

did have an unexpected Reunion about

1:13:47

four years ago when they ran into each other

1:13:49

at a farmer's market in San Luis Obispo

1:13:52

It was awkward in a way, but it

1:13:54

was also beautiful because for

1:13:57

the first time since the breakup He

1:13:59

exchanged a hug with me. You

1:14:02

know, like he walked over to me, we embraced like

1:14:04

brothers, and it

1:14:06

was like, how are you? And we had

1:14:08

a moment of just exchanging as

1:14:11

to people, not teacher guru. And

1:14:13

now it confirms for me this wisdom

1:14:17

that he provided me by

1:14:19

saying goodbye.

1:14:21

And it was beautiful.

1:14:24

Hey, thanks so much for listening to the show this week.

1:14:27

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1:14:46

And on Instagram, I'm at Guy.Roz.

1:14:49

This episode was produced by Kiro Akeem

1:14:51

with music composed by Rountine Ereblue.

1:14:54

It was edited by Niva Grant with research

1:14:57

help from Catherine Seifer. Our production

1:14:59

staff also includes J.C. Howard, K.C.

1:15:01

Herman, Carrie Thompson, Alex Chung,

1:15:03

Elaine Coates, John Isabella,

1:15:06

Chris Messini, Sam Paulson, and Carla

1:15:08

Estevez. I'm Guy Roz and

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