Profile: Marc Kreiner, TapouT President

F. Scott Fitzgerald wrote that “there are no second acts in American life.”  Marc Kreiner has proved him wrong – about 7 or 8 times (he’s lost count).  A serial entrepreneur, the Brooklyn-born Kreiner began his career in the music industry, launching some of the biggest names of the disco era, including Chic, and racking up over 200 gold and platinum records. Since then, he’s built and sold companies in industries ranging from telemarketing to cellular phones.  But it was his music career that helped forge a special bond with Charles “Mask” Lewis and Dan “Punkass” Caldwell, leading to what is arguably his biggest success yet – TapouT.  In a recent interview with MMA Payout, the TapouT President recounted how their partnership began and why he believes the sky is the limit for what he refers to as the “Nike of MMA.”

“It was about three and a half years ago,” said Kreiner. “I was getting ready to sell my infomercial company.  We were running the first MMA infomercial with TJ Thompson, selling MMA videos.  He knew these guys who were wacky and crazy and fun and they had a hot company and I agreed to meet with them.  So these two guys came to my office, and in came this guy with face makeup.  He’s yelling, ‘Hey! Yo! Hey! Yo! Marco Polo!’  And he’s with Punkass, who literally didn’t say a word.  I just instantly fell in love with them.  It was magical.”

Their initial meeting lasted five hours.  As Kreiner learned, Mask was inspired by music.  He spent over an hour examining every one of the gold and platinum records on Kreiner’s wall, peppering him with questions along the way.  When the discussion finally turned to business, the group quickly agreed to a deal.  Kreiner would add a TapouT beanie to his infomercial product.  But he needed about 10,000 right away.  “Little did I know,” he said, “that these guys didn’t have a pot to piss in.”  But they somehow provided the product, and the rest is history.  “To this day,” said Kreiner, “I have no idea how they did it.”

About a month later, Charles invited Kreiner to visit TapouT’s “headquarters”, which was all of about 1,200 square feet.  Inside were seven girls in bikini bottoms, packing t-shirts in 100 plus degree weather.  “It looked more like a strip club than a clothing company,” he said.

Mask and Punkass asked Kreiner to join them as an equal partner.  “They told me that whatever they’d make I’d make,” said Kreiner.  “So I asked them how much.  They told me two thousand a month, which at the time wouldn’t have paid for my gas.”

But Kreiner saw the potential.  He knew that his passion for business and his partner’s insights and vision gave them a great chance at success.  “I’ll admit,” said Kreiner, “That when I told my wife I was going into business with two guys named Mask and Punkass, she thought that maybe I was on drugs again.”

Today, Kreiner marvels at his partners’ vision.  “All those dreams they told me about, ‘We’re going to have our own TV show, we’re going to be a $100 million company, MMA is going to be legalized’, all those things have come true.”

The Grand Terrace, California-based company now has about 145 employees, a 65,000 square foot headquarters facility and 2009 revenues that Kreiner estimates reached $200 million.  He describes TapouT’s growth as “non-stop,” adding that his company “has chosen not to participate” in the recession.  “Everybody’s cutting and we’re spending,” he says.

Kreiner says the key to his success is his team, which consists of a group of hard core employees, many of whom, he points out, sport “Believe” tattoos.  As the company’s reputation and profile have increased, Kreiner says he’s inundated with calls from wannabe employees, which makes recruiting pretty straightforward. “We’re going out and finding the best in the area we’re looking for and hiring them.” Recently, for example, he strengthened the junior apparel division – which he believes can be a $100 million dollar business – with hires from Roxy and Quicksilver.

He’s also stepping up the marketing spend, including a $3.5 million dollar campaign in 2010 that will “change the whole look and feel of the brand.”  Not surprisingly, Kreiner has big ambitions for the launch.  “Don’t be surprised,” he said, “if you see a couple of TapouT ads during the Super Bowl.”  He plans to aggressively target the international market this year, calling it a “huge” opportunity for the company that “could be three times as big as domestic.”

One thing Kreiner will not do, however, is worry about potential competition.  “We’re the leader and we’re just riding the horse wherever it’s going,” he said. “Besides, if you have time to look at other companies or follow other companies, you’re not doing your job.”

He’s amused, rather than threatened, by the new entrants in the MMA market.  “You’re seeing all kinds of companies that can’t succeed in the business that they’re in spending all kinds of crazy money and doing all these stupid things.  And now they’re saying they’re the biggest MMA company.  You know what?  God bless ‘em because we just keep doing what we do.  You’re going to see a lot of flameouts in the next six months.”

We asked Kreiner how TapouT could keep growing without alienating its core audience.  He believes the answer lies in brand consistency.  “Here’s what we know about the consumer,” he said.  “They want the real thing, and [TapouT] is the real thing.  We’re staying focused on the brand.”  He cites the fact that the company is approached for licensing opportunities ranging “from toothpicks to trucks,” but turns down a majority of the offers.  “We’re looking only at areas that really complement us.”

While many big name apparel companies have approached his team, Kreiner doesn’t appear to be in any hurry to cash out.  “I have a passion for the sport,” he says, “and getting a big lump check is not going to do it for me.”  Nevertheless, he does leave the door open for a potential IPO.  “If there is a time in the future where we might be able to have a potentially nice payday for our employees, we’d consider it.  But it’s all about the company.”