Mission Athletecare, the startup looking to jumpstart the thermoregulation category, last week raised $35 million of growth capital for organic and M&A expansion in its core cooling and heating categories. As part of the new investment, Hap Klopp, the founder and former CEO of The North Face, joined Mission's board.
Launched in 2009 by a group of elite athletes including Dwyane Wade, Serena Williams, Reggie Bush and David Wright, Mission has broken out in recent years with its high-tech EnduraCool line of cooling products that now includes a wide range of towels, caps and sleeves. The company has grown more than 10 fold in the last five years, and is expected to achieve another year of double digit growth in 2015.
In an interview with Sports Executive Weekly, CEO and founder Josh Shaw, who was a contestant on Season 4 of “The Apprentice,” the reality TV show hosted by Donald Trump, believes Mission is already the leader in thermoregulation, which addresses both cooling and heating needs of athletes. But he believes thermoregulation can ultimately be a billion dollar opportunity.
“This capital raise, along with our recent executive hires, positions us to truly lead the development and expansion of the Thermoregulation category,” said Shaw. “The demand for innovative, affordable and athlete-engineered products that enhance performance by regulating temperature has never been higher, and we are positioned like never before to meet that demand.”
The capital raise, which was facilitated by Piper Jaffray, was led by Fremont Private Holdings and VO2 Partners. Shaw said the company does not reveal stake levels but both reflected minority investments. He was particularly enthused about the participation of Fremont, a San Francisco-based private investment company with a long history of investing across a wide array of businesses. Shaw said Fremont has indicated that if more capital is required to support growth, “they’re standing by. They’ve been tremendous. I would put them in the Ivy League of private equity.”
Shaw met Klopp, who is also an author, a Stanford professor and sits on several boards, through its other new equity partner, VO2 Partners. Said Shaw, “Klopp ran The North Face for 20 years so he knows all about growing businesses. But more importantly, he’s incredibly dialed in today within the sports, outdoor and textiles industries. He’s really more of a strategic advisor than a board member.”
“I am very pleased to join the leadership team of Mission, one of the most innovative and invigorating businesses with which I have ever been involved,” Klopp said in a statement. “The work they are doing to engage and assist consumers in vital areas like cooling, as well as the ways they are empowering and engaging some of the greatest athletes in the world, sets them apart and will make them a leader not just in sports, but in technology and innovation, well into the future.”
Fremont and V02 join existing investor Breakaway, and former Reebok CMO, Dennis Baldwin, who came in a year after Mission first capitalized the business. Besides Baldwin and Klopp, other board members include Bob Wright, the former CEO of NBC and NBC Universal who Shaw met while on the Apprentice and who has since served as one of his mentors. Phil Geier, Jr., the former chairman and CEO of the Interpublic Group who made a return on Shaw’s past ventures, also sits on the board.
While at University at Albany, Shaw launched the multi-media marketing services company, Student Advantage, Inc.; and later founded GoSMILE, a leader in the tooth whitening category that led by his appearance on the Apprentice.
Several professional athletes, including the aforementioned Wade, Williams, Bush and Wright, have also invested in the company and remain active in the business. Wade, who plays for the Miami Heat, inspired a Mission cooling towel for the head. Williams, who was seen with Mission towels at the Australian Open last month, is often the spokesperson for the brand.
“As an athlete and a businesswoman, I am proud to have played a role in the growth of Mission from the very beginning,” said Williams, a 19-Time Grand Slam Champion, in a statement. “I have believed in the brand and products from day one and this latest milestone is yet another step towards building Mission into a global brand.”
Shaw feels fortunate to partner with a core group of athletes “who are incredible on and off the field” and remain highly active in the business. “We have a few highly entrepreneurial athletes with us. They’re not only dialed into the product but on weekly calls they’ll talk about the P&L, marketing plans and other areas. Honestly, they look at this as their baby.”
Shaw said Mission started in 2009 in personal care such as anti-chafe cream but that category is “winding down” as resources are focused towards thermoregulation.
Another growth area will its Grip range, which it entered in 2011 in basketball with the Court Grip instant traction enhancer that keeps sneakers from skidding. The technology was co-developed with Wade. Mission subsequently introduced Power Grip, which eliminates sweaty palms with a no-mess gel. Last year, it unveiled Cleat Grip, designed to reduce mud accumulation on cleats.
But the biggest opportunity Shaw sees is around thermoregulation. Made from made from a proprietary performance fabric, Mission’s Instant Cooling Towels instantly cools when soaked with water, wrung out, and then snapped in the air to activate the cooling properties. It cools to 30 degrees below average body temperature when wet.
The towel was introduced in 2012 and its cooling range has expanded quickly to also include caps, sleeve and hats.
Mission will soon introduce heating products to complement its cooling range. Shaw also sees the potential to expand its fabric technologies across a wide range of items. Shaw said, “We’re continually getting inquiries and requests from athletes and consumers on whether we’ll be expanding to everything from shirts to pajamas and sheets.”
On the marketing front, four more athletes will be added to its roster in 2015, including its first NASCAR and NHL stars. Mission will also continue to conduct its mobile tour, which hands out samples and encourages testing.
Shaw notes that the presence of Under Armour, Nike, Columbia Sportswear and others offering their own cooling technologies speaks to thermoregulation’s potential. But Shaw believes Mission stands part because most of the technologies being developed by the majors are “not true technological advancements rooted in science.”
He also touts Mission’s singular focus on thermoregulation as a notable advantage. As an example, he points to Mission's partnership with the Korey Stringer Institute (KSI). Beyond using its own resources to advance education around the dangers of heat stroke, especially for athletes, Mission is donating $1 million in EnduraCool Instant Cooling products over three years to schools that implement and follow KSI's Exertional Heat Stroke Prevention Guidelines.
“None of the competitors are taking the approach to thermoregulation like the way Mission is,” said Shaw “We want to lead it and it’s a whole different dimension when you want to lead it. We’re like Under Armour in year five.”
