OC Business Journal

Velcro Valley vet Johnny Schillereff launches The Heart Supply

Velcro Valley vet, Element founder Johnny Schillereff has a new skateboard co. and a huge Target deal

■ By KARI HAMANAKA

Change. That was the news focus the last time Johnny Schillereff was in the pages of the Business Journal nearly a decade ago, when Element Skateboards relocated from its staid, corporate Irvine office space back to its roots in Costa Mesa.

Change is again underway for Schillereff, who last year made the decision to leave the famed heritage skate brand he started in 1992, to start a philanthropic-focused skate company with his wife, Kori, called The Heart Supply.

The Heart Supply business model is far different from Element: a focus on hard goods—complete skateboard decks (mean

ing they come fully assembled)—at more affordable pricing starting at $59.99.

It’s an about-face for Schillereff, after spending nearly two decades building a brand and business that peaked with sales in excess of about $200 million with the brand sold in more than 100 countries when he left the company. Element was one of the core lines parent Australia-based Billabong International Ltd. banked on in 2012 to help lead a turnaround, before the Billabong group was sold in 2018 for about $160 million to Boardriders Inc. of Huntington Beach.

The Heart Supply has moved quickly to build a following since kicking off last year, already counting two riders on the U.S. Olympic skateboard team, where the sport debuts this month.

The Tustin-based company also landed a key distribution deal with Target that this month brings The Heart Supply into nearly 2,000 stores nationally, in addition to the retailer’s online site.

The Target collection is being produced in partnership with Santa Monica toy and consumer products designer and manufacturer Jakks Pacific Inc. (Nasdaq: JAKK).

Here, Schillereff tells the Business Journal about his decision to start The Heart Supply, his vision for the business, and his thoughts on the broader action sports market.

What led to your decision to leave Element last year? Was it to start The Heart Supply, or was leaving something you had been thinking about doing for a while?

Walking away from the brand I started as a kid, in the early ’90s, was the toughest decision in my professional life but seeing what it was turning into was even more difficult.

Experiencing firsthand what the action sports industry and Element specifically were becoming, accelerated the need for change. I was also spending so much time defending my directives and saw so many decisions implemented that weren’t the ethos of the Element I created. This being said, I did not leave Element specifically with The Heart Supply in mind, but I left knowing I wanted to build a company that encompassed the true goodness of skateboarding.

The intangibles that uphold the integrity and authenticity of our industry are typically not the key drivers for private equity or public companies. Justifiably, ROI is. It was a very tumultuous time, and soon after the most recent acquisition [to Boardriders Inc.] I stepped down as president, a great trust was broken and in 2020 I said ‘goodbye.’

No one is to blame because anyone who buys a company, buys it because they think they can make it better—and whomever owns the business, also owns the decisions. No founder should ever expect anything different. Looking back, I have no regret and I’m grateful for what I learned and proud of what we all accomplished.

What’s it been like going from Boardriders-owned Element to being back at the helm of a business that you completely own and control?

Being owned by a public company or a private equity firm does have its perks. Yet, there are no personal guarantees, and those deep pockets are greatly abused. Especially by executives without entrepreneurial backgrounds or startup mentalities, and worse are the consultants that the buyers bring in with little to no relative experience.

For example, cutting all budgets for team riders while flying the entire merchandising staff and senior executives to Asia for a design inspiration trip. Forgetting our true and authentic inspirations are those team riders that were just left on the cutting floor.

Having survived multiple acquisitions and working with all the new teams that are brought in, it’s all the same formulas and results. Cut costs and burn cash. With so many failed attempts from outsiders, you’d hope a group would come in and do things differently.

Starting over and owning our business is empowering and you can’t put a price on freedom. Entrepreneurs and hired guns are cut from a different cloth. I am blessed to have experienced and learned from both and couldn’t be happier that I’m now a skateboarder who owns my skateboarding business with my family.

What was the reason for starting The Heart Supply? Are some of those same reasons for starting your current business the same as when you first started Element, or completely different?

There are similarities. We incorporated the same ethos and love for skateboarding that Element had, but with a narrower audience, product and purpose. My wife, Kori, founder of Element Eden and a skate mom, was always asked by other parents where to buy a kid’s first skateboard and realized a welcoming brand was needed for beginner skaters. We don’t want families or first-time skaters to be intimidated by skate shops or costs for an activity they may or may not continue, so creating a quality, introductory and accessible skateboard was our aim. As our kids had been watching us in the industry for years, it’s amazing that they are now working beside us in this journey.

Let’s talk about distribution at Target. How did that deal come about?

It had to start with personal reflection on my professional purpose and letting go of fears and insecurities developed from being a core skateboarder most of my life. After decades of navigating through core skateboarding with the same approach, my wife convinced me to step out of my comfort zone. It was time to speak to the next generation with a much-needed point of difference that provides families and future skaters a positive first skateboarding experience. This new business model helps ensure increased participation in skateboarding, which benefits the sport, our team riders and our ability to give free skateboards to kids in need. All the above lead to some preliminary meetups with Jakks Pacific and Target, where we learned we shared the same ethos and mission.

Some brands hold this philosophy that they don’t want to enter distribution into what they perceive to be a discounter or a big-box retailer on the basis that that could somehow be a ding to their brand’s equity. Can you talk about why Target made sense for The Heart Supply?

We take great pride in having the opportunity to work with and learn from the greatest and most innovative retailer of all time. Target makes sense because most kids buy their first skateboard at big-box retailers and for years; department store skateboards have damaged the first experience of many new skaters. Target will be the first department store to break the mold and offer an authentic skateboard company, with affordable, quality complete skateboards. Skaters shop at Target for all their essentials; it’s truly a one-stop shop. It is long overdue that a legitimate skateboard company explores larger sales channels while coexisting in the core. This is always the case with the world’s greatest and most iconic brands. Our intentions are to mirror that success and devote ourselves to our mission statement.

Can you talk about the giveback component to The Heart Supply?

Our aim is to give kids the gift of riding their own skateboard and welcome them to the skateboarding community. Through our partnerships with our retailers, distributors and nonprofit organizations we have given away more than 2,000 new, complete skateboards to kids in need around the world and we plan to grow that number annually.

We believe that the freedom, cultural diversity and friendships developed from skateboarding are invaluable. Riding a skateboard is a creative, physical activity that sees no color, inspires equality and builds self-esteem and awareness. Putting a skateboard under kids’ feet allows them to roll toward positive opportunities and a happier, healthier life.

You’re near completion on a philanthropic skatepark in Mexico. Was that a project you did on your own or did you have partners, and will there be more skateparks in the future?

My wife Kori and I met Ricardo Santa Cruz, a visionary developer, and became captivated by his unwavering passion for his calling: building the progressive town called Xala, on more than 3,000 acres along the Costalegre Coast in Mexico. He invited me into his world and gave me the opportunity to build a skatepark in this breathtaking location. Xala embodies our ethos and spirit. A sanctuary for the socially conscious, that sparks imagination while being immersed in skateboarding, art and nature.

By summer’s end we will complete The Heart Supply skatepark in the town of Xala. Coined as Xala with Heart, it will serve as the epicenter for like-minded skaters from around the world to gather, host events and give back to the community. Ricardo Santa Cruz’s great vision for the town of Xala has materialized, and Xala with Heart is a dream come true.

Do you think you will get into apparel in a big way, perhaps similar to Element, with The Heart Supply?

No. Our products will be centered around the foundation of our industry with a strict focus on affordable, complete skateboards, tools, protective gear and obstacles. Currently, Kori and our son Camp make custom tees and fleece exclusive to our team riders and families and look to create a modest collection in the future.

Your business is young and, yet, you already have two riders going to the Olympics. What does having that mean to you?

Recruiting and nurturing great skateboarders has always been my priority. I knew and admired Jagger Eaton and Heimana Reynolds years before we started The Heart Supply, so it wasn’t by chance they are part of our team. They are family and I’m humbled to be working with such kind and com

passionate individuals. We appointed them both as The Heart Supply’s first professionals and from then on realizing their dreams became our brand’s top priority to support. The Olympics was first on their lists. This duo competing in the inaugural year for skateboarding is going to have an immeasurable, positive impact on The Heart Supply, skateboarding and the world. We are honored and grateful to have two athletes and friends, competing in both disciplines (street and park). With their unparalleled work ethic, there aren’t two better skateboarders to represent our country in the Olympic Games. Skateboarding needs positive role models like them now, more than ever.

When you look at the time period when you were starting Element and then you compare the environment for starting a business today as you build The Heart Supply, what’s changed? Is it more competitive to start a brand today?

The competition is fierce today for starting a brand due to the accessibility to tools such as digital media, and the ease of manufacturing product. Starting a brand then or now is generally easy. It’s ‘staying a brand’ that isn’t. Whether it’s Element or The Heart Supply, ‘staying a brand’ requires tireless work, passion, patience and dedication and authenticity. These rare traits cannot be gained from followers, social media or deep pockets. The brand was named ‘Heart’ because that is what life breaks down to. Without heart, great tools, staff, team and money will not lead to success or happiness. That will never change.

Orange County’s apparel industry has always historically been dominated and defined through the lens of the action sports segment. Do you find that to be the case still today or would you define the apparel industry here in another way?

It is not the case today. The harsh reality is that most of the brands that once defined ‘Velcro Valley’ are no longer in business or relevant in the action sports apparel segment, but nothing is forever.

Staying on the subject of the action sports industry, it is not the size as it was in its heyday. What do you think are the factors that contributed to that contraction? Was it shifting consumer tastes or something else?

There is no contraction. The action sports industry is larger than it has ever been. It’s the majority of the iconic action sports brands that were taken over and decimated by public companies and private equity firms that have created this false perception. The truth is the action sports industry is healthier than ever and shows no signs of slowing down. Consumers continue to embrace the surf and skate lifestyle. A new crop of companies is flourishing during this spike, but the usual surf and skate suspects aren’t participating in this surge. Consumer tastes have shifted but not away from action sports, rather evolved into a lifestyle that the older regime struggles relating with.

Skateboarding is forever rolling forward. It’s not just about the activity or street and park skating anymore. Now, there are skateboarders who are world famous influencers, designers, models, musicians, entrepreneurs and Olympians. Skateboarding lifestyle has always defined pop-culture, and with its growing influence and reach, it’s only gaining more momentum.

The Heart Supply

▪ BUSINESS: philanthropic skateboard company

▪ OWNERSHIP: family owned and operated

▪ HEADQUARTERS: Tustin

▪FOUNDERS: Johnny and Kori Schillereff

▪ NOTABLE: struck distribution deal with Target

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