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Breaking: Surfstitch sells Stab!

Chas Smith

by Chas Smith

To Stab! What a world we live in!

Remember those heady internet bubble years when money flowed like tap water and Netscape I mean AOL I mean Surfstitch ruled all? There were no losers only green green pastures filled with suckers I mean investors I mean you. Just kidding. You never invested.

Well, the damn bubbles always burst. Netscape turns dumb, AOL turns old and Surfstitch turns what the hell. Two years ago, Australia’s online surfwear retail giant was high and scooping up businesses at a wild clip. Millions for FCS. Millions for Magic Seaweed. Millions for Stab. Now they are dumping assets like old Halloween candy. It was rumored that Stab was even being shopped for running costs.

Well guess what? Surfstitch found a buyer and you’ll never guess who. Let’s let the Australian Financial Review to see.

Embattled online retailer SurfStitch has sold Rollingyouth, the owner of Stab Magazine, back to its co-founders for a nominal sum after splashing out almost $6 million for the Bondi-based publisher during an ill-fated acquisition spree.

The administrators of SurfStitch Group, John Park, Quentin Olde and Joseph Hansell of FTI Consulting, announced the sale of Rollingyouth Pty Ltd on Monday, almost three weeks after SurfStitch was placed into voluntary administration to buy breathing space from creditors and legal foes.

Mr Park said Rollingyouth, which trades as Stab Magazine, had been sold to Rollingyouth Media Pty Ltd, a company owned by Stab co-founders Sam McIntosh and Tom Bird for a nominal cash consideration. Discussions had been underway for months before SurfStitch went into administration.

Mr McIntosh and Mr Bird sold the business to SurfStitch in May 2015 for $2.26 million in cash and 2.43 million SurfStitch shares worth $3.6 million at the time. The shares vested in three tranches in May 2016, May 2017 and May 2018.

Those shares are now worthless unless creditors approve proposed offers to restructure and relist the company under a deed of company arrangement.

Mr Park said SurfStitch Group and Rollingyouth Media would maintain a close commercial relationship, with both parties entering into a three-year agreement for the supply of marketing and content development and advertising services to the SurfStitch Group.

Rollingyouth is the third asset sold at a big discount to its purchase price by SurfStitch’s new board and management team, led by chairman Sam Weiss and chief executive Mike Sonand.

Between December 2014 and December 2015, SurfStitch outlaid more than $120 million in cash and shares on five acquisitions, including $24 million for Surf Hardware International, $5.8 million for Stab, an online surf content platform, $8.5 million cash and 2.29 million shares for UK-based surf forecaster Magicseaweed, and $15 million for Garage Entertainment, which made action sports films and videos.

SurfStitch co-founders Justin Cameron and Lex Pedersen wanted SurfStitch to become the Amazon Prime of the action sports world, using unique content to attract customers and keep them engaged.

However, shareholders started questioning the strategy after Mr Cameron backed away from earnings guidance in February 2016.

Mr Cameron quit unexpectedly a month later to purportedly pursue a private equity-backed privatisation, which never eventuated.

Within months of Mr Cameron’s departure, SurfStitch’s new board and management started revaluing the acquisitions, writing down the value of goodwill for Rollingyouth, Garage Entertainment, Surf Hardware and Magicseaweed by $28 million.

SurfStitch sold Garage Entertainment in April to Madman Entertainment for a nominal sum after writing down the value of goodwill by $12.9 million, while Surf Hardwear International was sold in December for $17 million cash to Gowing Bros.

Negotiations are also believed to be underway for the sale of Magicseaweed.
Mr Pedersen left SurfStitch shortly before the appointment of administrators last month and is believed to be involved in a new digital venture dubbed Periscope with two other SurfStitch executives, former global marketing director Martin Corr and head of business intelligence Clover Chambers.

Based in Mona Vale in Sydney’s Northern Beaches, Periscope will provide strategy, consulting, infrastructure and services to other e-commerce businesses, according to Mr Corr’s LinkedIn profile.

SurfStitch shares were trading at 6.8?? before the stock was suspended in June – a fraction of their December 2014 issue price of $1 and the $2 some shareholders paid in a capital raising in November.

Surprised? Happy?

Viva the little man and welcome back to private ownership dear Stab. The water is warm!

Buy: Dane Reynolds-approved Nail Polish!

Derek Rielly

by Derek Rielly

Former moves into male cosmetica!

One of the most interesting things about the business experiment called Former, with Dane Reynolds as its CEO, is its determination to succeed.

Dane tore up a $400,000-a-month contract, and Craig Anderson a million bucks a year, to pour themselves into Former and early signs suggest neither surfer is too proud to package or promote the range of t-shirts, pullovers, pants, beanies, trunks, towels, jackets and… nail polish.

Nail polish?

Oh yes, it’s a thing. As the New York Times breathlessly reported a few years back, nail polish for men “has had an explosive growth.”

Me, I kinda like the nail polish thing if it ain’t black.

Black reminds me of rain-soaked days in film festivals with earnest young men looking gloomy, smoking sad cigarettes and wearing hats that belong on the captains of sea-going boats. It’s an easy wear.

I figure, if you’re going to be a nail polish guy, at least throw a little sun-ripened technicolour in there and get real fruity.

The Former range includes the colours: white devil, jazzberry jam, banana mania, radical red and atomic tangerine.

The full “Premium Violence” set costs twenty American dollars plus postage.

Buy here. 

And watch the gang’s latest promo movie, Premium Violence, here.

 

Watch: Most shameful use of surfing ever*!

Chas Smith

by Chas Smith

*in a television commercial.

How long was Samsung the title sponsor of the World Surf League? It was at least two years right? And maybe three or four. In my memory, Samsung had even sponsored the Association of Surfing Professionals and had stayed on because they believed in then CEO Paul Speaker’s vision.

Right?

Whatever the case, they were around long enough to know what good surfing looks like and apparently this is it.

Good surfing is a boggy mid-faced backside turn on a waist high wave. It is an embarrassing halfway hack. An awkward herky-jerky hip twist. A strained neck.

For shame, Samsung.

This is worse than blowing up people’s ears with your phones. This is worse than my Samsung washing machine that got recalled because the top was flying off and injuring people during the spin cycle and I got “two” options when I called the recall hotline. Repair or replace. I chose replace of course and was then informed that “replace” meant I would get a $50 dollar coupon that could be used toward the purchase of a new Samsung washing machine so I then chose repair. A man came to my house, took the top of the washing machine off and tied it back together with two heavy brackets. After he left the spin cycle wouldn’t work at all so I had to call another different technician. He came and tested the machine and told me to always use the “heavy load” cycle. It still didn’t work so another different technician came and tested the machine and told me to use the “heavy load” cycle BUT never to use the heavy spin. Always use the light spin. Now it works as good as the above turn.

For shame, Samsung.

10 Signs You’re A Filthy Kook!

Derek Rielly

by Derek Rielly

Fulfil the criteria of just three and, yes, you are, officially, a filthy kook!

I’ve been a kook for so long I can’t imagine being anything else. There have been a few moments when I thought I’d finally shucked kookdom, when I was teased with the prospect of delirious and unlimited delights.

The three straight airs landed. A couple of odd-looking, out-on-the-face, ass-in-the-air reverses. A lucky tube.

They were illusions, of course.

I started too late. Didn’t obsess enough about it to permanently burn the movements into my muscles, the processes into my brain.

I got thinking about it yesterday when I flew to the mountains for a one-day hit of snow. Epic season. Don’t wanna miss it. Took my kid. He’s ten. I’ve ridden fifty-ish days over twenty years, he’s had a week over three. He flies down the blacks hitting everything and spinning. I’m kicking the tail out, panicking at speed, catching edges and groping the piste on toeside turns.

Kook forever. But I accept it. It’s my state.

Are you a lifelong kook? Do you recognise yourself in the behaviours below? Three or more and, it’s official, you’re a kook!

    1. You believe surfing is a democracy: As vibrant as our game is, it ain’t a tableau of fairness. Never was. It’s a meritocracy. The best surfers get the best waves, get any wave they want and if they want to drop in on your disorganised jabbing of the lip, if they want to paddle around you to takeoff on a wave from its most critical juncture, it’s their prerogative. If you sit out the back hissing at the unfairness of it all, then you are a kook.
    2. It’s your surfboard, not you: The kook is what keeps the surfboard industry alive. Your failures can’t be attributed to the misplacement of limbs, the panic as you hover in the lip, the razor-blade paddle technique. Gotta be the board. And so you buy and accumulate surfboards like a vain woman does shoes. Every night when surf shop employees go home they laugh at you and your stories of boards“not working” and your earnest selection of $200 carbon fins.
    3. You are a princess with a pea: You know the old fairy tale? About the gal so regal she could feel a pea in her bed even when it was buried under twenty mattresses? You actually believe you can feel that subtle concave washing between the fins.
    4. You think literage is everything: Once you get that magic number you’re obsessed by it. But what’s the literage? How many litres? Can you build it in a 27.5?
    5. You don’t get localism: The universal rights of man and so forth. You’re the guy who calls a Hawaiian off a wave at Rocky Point or an Indonesian at his home in Bali. You believe that whomever is on the inside, wherever it is, has the absolute right to that wave. It doesn’t if they’ve they’ve just arrived from Italy and piloting a Wavestorm or it’s a pro-level surfer who’s ridden the same hometown ledge, expertly, for the last ten years.
    6. You own at least one shark repellant: Leash, shield, band.
    7. You write screeds on Kelly Slater’s Instagram criticising his surfboards.
    8. You talk surf whenever you meet someone. Did I tell you about my last trip to Costa Rica? Nicaragua?
    9. Vacations are sought at surf camps: Games of pool, surf movies, other like-minded boys? It’s a YMCA with tan!
    10. You use a change poncho: What do you hide, little man?

Did we track wrong Brazilian Storm?

Chas Smith

by Chas Smith

Look down to the WQS then batten down the hatches!

Have you been tracking these hurricanes, Harvey, Irma and Jose? Watching them form, bob, weave, dissipate and grow? It’s fascinating and what’s most fascinating is they way they defy prediction. The experts, weathermen, etc. can all postulate all they want but the storm decides what its going to do and only decides at the very last second.

Much like the Brazilian Storm!

Do you remember the predictions of Brazilian dominance from five or such years ago? They were going to win, win, win, win, win, win, win. There was going to be so much winning that the country of Brazil would be sick of winning.

Gabby won and it seemed on. Adriano won and it seemed go-ish time but then… stall. John John took the wind and it seems as if all the winning was overstated. I mean, I guess two out of three ain’t bad but it never seemed… dominant.

But maybe just maybe we were tracking the wrong Brazilian Storm? Maybe the Gabriel Medina led hurricane wasn’t the one?

For if you look down at the WQS all you see is Brazil.

Jesse Mendes

Yago Dora

Alain Delon

Michael Rodrigues

Willian Cardoso

Jean Reno

Tomas Hermes

Alejo Muniz

Jean-Luc Godard

Yves Montand

Bino Lopez

Crazy no? Most of these will be filling into the Championship Tour in the coming two years and then will a non-Brazilian ever win again?

Is this second Brazilian Storm an actual Category 5? Read about it here!