“Building a brand from the ground up”: Inside LSKD’s San Diego expansion

Sportswear retailer LSKD has been expanding rapidly throughout Australia in recent years, and has now set its sights on a bigger market: the US.

Here, we speak to founder and CEO Jason Daniel about the brand’s international strategy, e-commerce’s growing interest in physical retail, and doing more with less.

 Inside Retail: Earlier this month, LSKD opened its first store in the US, in San Diego. Can you tell me a bit about how you’ve laid the groundwork for launching a physical retail presence in the US?

Jason Daniel: Our mission is to inspire people to chase the vibe through sport, fitness and adventure. We create sportswear with a street aesthetic, and we predominantly work with athletes – not so much influencers – in the functional fitness, running and CrossFit space. We’ve been doing that in the US for a couple of years now, as well as community events with local gyms.

It’s really about building a brand from the ground up. That’s been the biggest focus for us. I took a trip here in April last year – as soon as travel came back. About eight of our team came over, and we met people and athletes and just ingrained ourselves in the community in Pacific Beach, San Diego. That was where it all kicked off. 

IR: It seems that most Australian brands choose LA as their launchpad. What drew you to San Diego specifically? And can you tell me about any other US states or cities that you have your eye on?

JD: The reason behind San Diego is that we’ve got a couple of brands that we’re quite friendly with. One is Blenders Eyewear. We have a great relationship with that brand. They’re really big in the US, and we get along really well with them, so we decided to stay right near their office. 

We do a lot throughout the US – we’re always doing events – but our focus is San Diego because it’s the location of our community.

A lot of brands do choose LA, and I love LA, but once we went down to San Diego and started training with the fitness community, we just had this feeling. We didn’t plan on opening an office, but our first US team member has been here for almost two years. 

IR: You’ve been selling online in the US for a little while. How has that been going? Did you reach a point where you felt that it made sense to open a store? 

JD: Yes and no. We were in Miami, Florida, for a big CrossFit contest called Wodapalooza, and that event went really well. It was a big indicator that we needed to set up out here. We’d never done an event at that level before – there were 50,000-plus community members. I think that was the tipping point to understanding that the community really wants to touch and feel the product, and you just don’t get that online. 

I think the industry has changed quite a lot. It used to be all about Facebook ads and SEO. That still plays a big part of it, and we still play heavily in that space, but we are very passionate about our fabrics and our fit, especially in women’s leggings, and you just don’t get that feeling online. 

We also needed a small office for the team to work from to be honest with you. We didn’t want them working from home because I think you lose the culture. We were very lucky to find a space on a main street in Pacific Beach, and we decided to open a retail store at the front and our office behind it, which is exactly what we have back in Australia. It worked really well, which led to us opening stores in Australia. And now we’re going to open our sixth store next month, in Bondi Junction.

IR: The last year-and-a-half has been insanely busy for LSKD. How are you handling that?

JD: I was very lucky to have LKI [Loose Kid Industries] before LSKD, from 2007 to 2018. I didn’t go full time on LKI until 2010, when I finished my carpentry apprenticeship, so as much as it’s been a whirlwind, if I had this kind of growth back in my early 20s, I don’t think I could have handled it.

As much as it sucked in our LKI days – we couldn’t grow, and we were stuck in a rut – I’m almost thankful for that time because it enabled us to become clear about who we are, our mission, our values and why we come to work every day. It’s exciting, and hopefully we can build a global brand out of Australia and create careers globally.

IR: Do you have plans to open other stores in the US, and if so, what other locations are you considering?

JD: We don’t have any concrete plans yet, but we will. What we have done recently is sign a partnership to be the official womenswear supplier for Lifetime Fitness, which has over 2 million members. 

IR: It seems that a lot of Australian retailers are considering international expansion right now. Do you think there’s been a mindset shift around this? And if so, what do you think is behind it?

JD: For us as a brand, we expanded internationally because we felt we had something special, based on the feedback from our community and athletes around the world, especially in the US. During Covid, brands’ international sales grew because everyone went online, so everyone saw the opportunity – ‘I’m seeing interest from this country, why aren’t we pursuing this?’ 

I also think the barriers for entry have changed a little bit. Australia and New Zealand are still our largest markets, but the US is really growing and it will take over – it just takes time. Our reason for going to the US is to share our mission and values and build something bigger than ourselves.

We still have a lot of growing to do in Australia. We’ll probably have nine stores by the end of this year, and that’s only between New South Wales, Victoria and Queensland. We are going to open in other states once we get our operating principles right. 

It’s an amazing opportunity for our team in Australia, not only to build their careers, but also to understand the global market, which – for an Aussie brand based in Logan, Queensland – is really exciting. 

IR: Opening stores and expanding overseas are typically quite costly endeavours. Can you tell me a bit about how you’re funding these initiatives? Have you taken on any external investment?

JD: We’re a self-funded business. We’re a profitable business, and our values are to do more with less, so we are reinvesting back into opening stores and expanding the international business. We have an amazing CFO, and we’ve got great relationships with banks, but we don’t have any external investment. When you’re doing leases, there is support with funding for fitouts, but we still have capex on top of that, so there’s a lot of planning behind it. Our stores are going really well, which is amazing. 

We started growing pre-Covid, and we were very lucky to grow through it. One thing we decided to do was reinvest. We opened an office that had a gym on the rooftop for the team and our community to train in, and we kept reinvesting back into the brand.

I want to build my career as a founder and CEO, and I want to give our team that opportunity because if they don’t get it, they’ll get bored. If you find a hungry, humble, smart team, they want to keep growing – how do we help with that? 

IR: I’m sure you’re getting a lot of interest from people who want to invest in the business. Would you take on investment to scale the business much more quickly than you’d be able to do otherwise?

JD: We don’t have any plans to do that right now. I’m not saying we don’t get tapped on the shoulder a lot, it definitely happens, but we also get to learn from it. We get to learn what we want and what we don’t want. For us, it’s about building the brand and growing the business and making sure that every decision is aligned with our mission to inspire people to chase the vibe. We’re trying to create the best sportswear and women’s leggings in the world for our community. I think there’s something special about that. 

Not so much about maintaining control, but about making some great long-term decisions for our team and the community and the brand itself. I truly believe we’re building something bigger than ourselves. We’re very passionate about our culture. We have a personal development coach for our team. We pay for their Audible accounts so they can listen to books that we recommend. If they want to run a 10K, we’ll pay for their entry. 

IR: I think some people might not know that LSKD – which stands for loose kid – started off as a wholesale brand. Can you tell me about launching the business initially, and why you shifted your focus in 2018 to direct-to-consumer – first online and now offline as well?

JD: The brand started in 2003. I was still in school, and I rode BMX, and they called me “loose kid on a bike” – that’s how the nickname started. I was riding with guys a lot older than me who were pro athletes, and then in 2007, I decided that I wanted [the brand] to be my career. I never had the intention to do wholesale, but that’s what was around back then. I transitioned the brand to LKI in 2007. I was still working a full-time job as a carpenter and racing motocross.

I had a huge passion for becoming a professional motocross athlete. By 2010, I’d finished my apprenticeship and went full-time with LKI. We moved out of my mum’s bedroom and into our first office, which we actually still have to show the team how far we’ve come. I would go out on the road and sell to retailers, and eventually, we ended up getting the brand into City Beach, which is one of the big surf-street retailers in Australia. I learned indent business and how to develop products 13 months in advance. That was the way you built a brand. I didn’t know what I didn’t know.

Once I started to realise what brand meant, I realised I was making too much product for everyone. I was making life jackets, motocross gloves, motocross socks, sportswear, I was making some streetwear – not really understanding that I was in too many categories. In 2017, I started trying to find our “why”. That led to us going, “How do we build something greater than ourselves?” Which led to us developing products, with our women’s rep tights, and then to building a DTC clothing brand online, because then we could control our brand message and our mission and values.

Once we opened our retail store at our headquarters at the start of 2022, that led to us realising we needed to have a true omnichannel brand and not just be DTC. 

IR: Omnichannel has obviously been a buzzword for several years, but now we are seeing a lot more DTC brands come full circle and embrace retail partners again. What are your thoughts on this?

JD: Having retail partners can still make sense, but it’s about choosing the right retail partners that align to your brand. It’s not about trying to be in every retailer – you’ve got to be in the right ones for the long term. That’s the way we’re thinking. If we decide to do more wholesale globally in the future, would we go into Macy’s or Nordstrom, or would we go into an Equinox or a Barry’s, where the alignment is? It’s really early days for us, and as we grow – we’ll grow 45 per cent this year – it’s about making the right calls at the right time for the brand. 

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