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The fascinating story of how 2 brothers went from running a failing business out of a van to building a $130 million company

Business Insider Australia logo Business Insider Australia 16/04/2017 Natalie Walters


Life is Good Bert and John Jacobs © Provided by Business Insider Inc Life is Good Bert and John Jacobs

What are we going to do with our lives?
That's the question Bert and John Jacobs were trying to answer when they decided to take a seven-week road trip from California to Boston in 1988.

The brothers -- 20 and 23 at the time -- say that the trip forever changed their lives.

John tells Business Insider that it was during this time that he and Bert decided to pursue a new -- and less traditional -- career path: They began selling T-shirts.

They named their company Jacob's Gallery, and tirelessly travelled up and down the East Coast selling shirts to college kids out of their used Plymouth Voyager. But the business struggled, and at one point the brothers had just $78 (NZ$84) in the bank.

But everything changed when they added an optimistic message to their shirts in 1994.

"We were searching for so many years for, 'What do we stand for?'" John says. "Then when we put out this new design, the response was so immediate. It was exactly what we had hoped for."

They rebranded and relaunched their company under the name Life Is Good, and within three years, they broke $A1.3 million (NZ$1.4 million) in sales. Now they're up to $A130 million (NZ$140 million) -- selling their products in about 4,500 retail stores.

Here's the story of how these brothers went from running a struggling business to a successful one:

The early years

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John and Bert Jacobs grew up as the youngest of six children in the Boston suburb of Needham, Massachusetts. They describe their childhood as 'perfectly imperfect' in their new book, 'Life Is Good.'

The second floor of their $A19,776, 720-square-foot house had no heating because, according to their father, a World War II and Korean War veteran, 'heat rises, and you kids hang out mostly downstairs in the winter.'

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After playing outside all day, they would run to the dinner table, where their mother would say something that later inspired their business: '
Tell me something good that happened today.'

'Rather than complaining about the day, commiserating about struggles or opening up the possibility of a fight, she focused everyone on the positive,' the brothers write.

© Provided by Business Insider Inc This optimism was especially important for the boys in elementary school, when their parents were in a near-death car accident from which their mother managed to escape with just a few broken bones -- but their father lost the use of his right hand.

The stress and frustration from his physical therapy caused him to develop a harsh temper.

'He did a lot of yelling when we were in grade school,' John says.

But even when difficult things were happening around the house, their mother would still be singing, telling stories, and acting out children's books for them.

'That optimism was something that our family always had, even when we had little else,' they write.

The road trip

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In 1988, the adventurous brothers decided to take a seven-week road trip from California, where John was in school on an exchange program, back to Boston. The purpose: to

figure out what to do with the rest of their lives.

'We began with a thin stack of cash, a map of the United States, some mix tapes custom-made by our big brother Allan, and a strict plan of no plan,' they write.

And, according to John, it worked.

Not only did they spend their days swimming in beautiful Southern California, meeting amazing friends, and playing pickup basketball in Venice Beach -- they also discovered what to do with their lives: start a business together that let them be creative.

'If we hadn't taken that trip that let us explore new places, new people, and new experiences, maybe we wouldn't have gotten to such an open mindset where we're thinking there's no reason why we wouldn't take a shot at starting a business together -- even if it sounded a little crazy to some of our friends,' John says.

Take 1: Jacob's Gallery

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When they got home, the brothers moved back in with their parents and started selling a variety of T-shirt designs under the name 'Jacob's Gallery' in college dorms and at street fairs around Boston.

'Instant hit? Not even close,' they write.

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The brothers knew college students could be a good audience to target, but they weren't connecting with them.

Never ones to back down, the brothers decided to up their game by purchasing a used Plymouth Voyager van for $A2,768 so they could travel up and down the East Coast to a different college nearly every night.

It was nicknamed 'The Enterprise' because it literally contained their entire enterprise: their T-shirts and them.

'Everybody else thinks it was a cool van, like a VW. It really wasn't. It was like a Plymouth Voyager -- a soccer mum van,' Bert told The Huffington Post.

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'We tried and failed a thousand times,' they write about their T-shirt-selling road trips.

They tried to figure out if it was because the designs were bad, students had no money, or they were waking them up at 1 a.m. to ask, 'Wanna buy a T-shirt?'

'When you try, you either succeed or you learn. In both, you win,' they write.

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Soon the brothers transitioned into their late 20s and were still living paycheck to paycheck.

Bert's girlfriend broke up with him after her mum gave her a quick dose of reality.

'He's almost 30 years old, and he still shares a van with his brother. You need to get real,' she told her.

But the brothers knew that if they listened to the doubters, they would also have to come back down to reality, take the safe route, and miss out on realising their full potential.

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This mindset gave the brothers the motivation to host an old-fashioned keg party after they returned from each road trip -- no matter how discouraging the sales were.

The parties were a win-win because the brothers would provide free beer and entertaining stories from their trips and friends would provide honest feedback on new T-shirt ideas.

Take 2: Life Is Good

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After one such discouraging road trip that left them with $A103 in the bank, John and Bert mustered up the courage to throw another party, perhaps their last.

They shared a design they had come up with on their way home while discussing how much they disliked the negative news cycle. They talked about how difficult it was to stay positive in such a negative world.

'But what if there was someone who was always happy no matter what was happening?' they wondered.

So John drew that person, who ended up looking like a bohemian guy with a beret and sunglasses and a big smile. The design was the hit of the party.

One comment on the wall next to the happy-face design captured why: 'This guy's got life figured out.'

So the brothers shortened that phrase to 'Life Is Good,' printed out 48 T-shirts, and brought them to a street fair in 1994 in Cambridge, Massachusetts.

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The T-shirts were sold out within an hour -- even the two prints off their own backs.

'People 'got it' and they bought it. No explanation was necessary,' they write.

The brothers were ecstatic -- they had finally found the message they wanted to share and people loved it.

'We were searching for so many years for, 'What do we stand for?'' John says. 'Then when we put out this design, the response was so immediate. It was exactly what we had hoped for.'

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The brothers knew that this could be their big break if they got their design in front of more eyes. So they loaded up The Enterprise with high spirits and shopped the design all around Boston with no takers -- until they came to a small flip-flop shop on Cape Cod.

Nancy, the owner, bought 24 shirts and asked, 'What's the smiley guy's name?'

Thinking on the spot, they said, 'Jake' because it was short for Jacobs. Later, they discovered that this was a stroke of genius because 'jake' is an old term for 'everything's all right.'

The shirts sold out in two weeks. By the end of the year, Life Is Good had sold $114,700 worth of T-shirts.

First signs of success

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With demand picking up for the feel-good shirts, the brothers decided to take a leap and hire their first employee: Kerrie Gross, the 'adorable 23-year-old' who lived an apartment above the brothers.

When they hired her as 'business manager,' they asked her what the least amount of money she could earn to pay off her bills was. She said $22,412, and they agreed to that.

By the end of the year, the company had done $345,420 in top-line sales and had successfully paid their first employee.

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Confident in their sales, the brothers upgraded their office to a 40-foot shipping container on a dirt lot in 1996.

During this time, they sent unique invoices to their customers that included the photo above and this humorous note: 'Please pay on time so we can keep these lights on and pay our hungry warehouse staff.'

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In 1997, Life Is Good broke $1.3 million in sales, and they celebrated by hiring three new employees and moving into their first real office in Needham, Massachusetts, where they made it their mission to continue establishing a company culture that welcomed humour at the office.

Why?

'Because laughter relaxes us, it ambles us to think more clearly as well as communicate and solve problems more effectively,' they write.

Spreading the Life Is Good message

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Life Is Good -- which has expanded its product line beyond T-shirts -- now has about 160 employees, is doing $130 million in sales, sells in about 4,500 stores, and donates 10% of its annual profits to helping improve children's lives.

And the brothers attribute all of their company's success to the contagiousness of their mission, 'To spread the power of optimism,' which they learned from their mother early on.

'We want to spread this message and help people understand the depth of what that means,' John said. 'It's not that life is easy or life is perfect. It's that life is good.'

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