Steven and Jordan Neman started House of Léon as a DTC business that only the brave would attempt: furniture. Massive, bulky, made to order, and expensive, how could they apply DTC building blocks to something so far outside of the box? In this episode, Jason talks with Steven about how they got started and what they are learning along the way.
Jason and Steven begin by talking about what went into founding House of Léon and how they were able to work around the standard furniture manufacturing conventions that guarantee that almost everyone is paying the same prices for mostly identical pieces, no matter the branding. Instead Steven and his brother Jordan began by designing one-of-a-kind pieces and then found someone who would make them to order, always putting their vision first. Of course, the brand has only existed since 2021, so there have been lots of learning along the way - Jason and Steven get into what it takes to manage inventory when it is so large in size, how to manage it by doing market research ahead of time, and what Jason wishes he had learned when he was at the beginning of his founders journey.
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A major mistake was not doing, uh, research on what people want. And we came out with a collection that was really dark and, you know, the market really wanted light natural colors. And we came out with the dark collection and it didn't do well. It was probably your advice that I followed that it was like with DTC, if you don't have a physical show showroom, you need to have, uh, amazing quality pictures.
Yeah. You're able to create this perceived value.
All righty guys. Welcome back to another episode of the Building Blocks podcast show. Today I'm joined by Steven Neman, who is the founder of a co-founder and our CEO, right?
Uh, yeah, just co-founder we don't really have a CEO just yet.
And, and you're
starting this with your brother?
Yeah, my twin brother.
You have a twin brother that's sick.
Well, continuing on House of Léon I met Steven at a dinner and I said, crap, we need a catch up. So come onto my show. Welcome. It's been a minute since we talked.
Yeah. Thank you so much for having me. It's honestly, an honor. Um, the, you know, the first time I like started the company and I, I, I had this deck from someone and it just kind of explained to me the DTC world.
And, uh, when I bumped into you at that dinner, that was the first time I really met you in person and I, and I put two and two togetherthat you were the first you were that person, you were the person who created that deck. It was a pretty funny coincidence.
You created, yeah. You created a deck like two or three years ago.
Yeah, it was probably when you started as well. And, uh, it was like super helpful. I had it bookmarked for a couple years until I kind of went through it all and
That's sick. Yeah. No, I started at three years ago. I think it's like 56 pages of everything that you need to know about the like building a DTC business.
Glad to help. Glad
to connect again. Um, I wanted to talk to you because you built a very phenomenal business that I don't think I can ever touch, which is furniture. I sell things that are this small, you sell things that are so big it won't fit in this camera. Um, you do. And so I want to bring you onto a show to talk a little bit more about the, the manufacturing side of things, the logistics side of things.
You know, mistakes that you make, um, or, or you made and things that, you know, learning's along the way. And first thing that was really top of my mind was what really inspired you to build House of Leon. Like I, I know previously you were in real estate and all of a sudden you went to furniture.
So me and my twin brother were both in real estate, two different, um, aspects of it, construction versus finance and asset management. And, uh, neither of us were really happy with it. . Um, I remember going to like those luncheons and it was for real estate. Um, so similar to what we had with the, a Kendo in Georgia, a gorgeous thing that we met at, and I was sitting there and I was like, I really am not happy with what I'm doing.
Uh, COVID hits. And, uh, my twin brother who has a really, really good eye for design is helping friends and family design their apartments and homes. And he's looking, you know, at the market and he's seeing, and he wants his, his friends to buy pieces that are really unique. And like, if someone walked into your, your home, they would see it and be like, wow, this is amazing.
But all those pieces are really expensive. Cuz designers are really talented. Uh, they charge a lot for those, for those pieces. Um, along with that Jordan noticed that manufacturers, that retailers like CB2 and, you know, Lulu and Georgia, all the big players are buying from the same manufacturers. So, uh, you know, Jordan and I decided to come together and create a company where all the pieces are, you know, brand new designs, really unique designs, really cool designs that we're trying to make it as affordable as possible.
And making luxury premium items affordable is obviously a unique position, but it's incredibly difficult to do. Especially being a US company, uh, walk me through how'd you find your initial manufacturers and what are some of the things that you do to keep the prices low or rather like, is it just everyone else is overcharging and you're just charging a reasonable rate? How does it work?
So I don't think other people are necessarily overcharging for those. Like, let's use CB2 as an example, they're buying furniture from a manufacturer and that manufacturer has an MSRP price. So it's like the minimum that they're allowed to sell it at. It's so all vendors can't, you know, uh, undercut each other.
Um, uh, but me and Jordan, the way we found our manufacturer, it's kind of, we kind, kind of got lucky. We had this friend, she was Turkish. She, uh, is in an interior design space. And she, she found out that we were trying to find a manufacturer and she connected us with a company that she worked with in Istanbul.
And they were very, they're a very small manufacturing company. They're actually, they weren't necessarily a company. They were like a, uh, family owned atelier, you know, three generations, the grandparents, you know, fathers and their sons all work in the same factory together. And, uh, they just kind of believed in what we were trying to do.
They had the capabilities to manufacture, the first collection that we designed, and it was just a really good fit because both of us were really small and both of us were really eager to grow together.
That makes total sense for people who don't really know furniture much. I mean, I bought half my furniture from Ikea and then the rest I started, like, mm-hmm, really going into like the nicer things, cuz you know, as you make a little more money, you wanna elevate your home, but I don't really know.
What is that big difference between furniture pricing? Like, how, how do you stand out amongst so many furniture brands? Is there, is there like a particular thing that you do special that no one else is doing?
I don't wanna say no one else is doing it, but I think that we are really good at, at creating really good designs that are really, really good quality.
And we're trying to make it as affordable as possible. Um, if you take - so furniture prices are are expensive. Um, but if you take our pieces and compare them to our competitors who are, who, who are at the same price point, we really, really, really feel that our quality is a lot better. Um, You know, we, I don't wanna name any other, any comp other companies, but we, you know, we had clients switch out chairs from a previous company to ours and their chairs were like three times lighter.
The wood felt like plastic. Um, our chairs are very heavy, like 25 pounds and that's like unusual. Um, also you said, like you talked about like the pricing of our stuff. Um, we, a lot of companies like Ikea, you know, you have to assemble it yourself. Yeah for onsite. Um, we don't do any assembly. We have a white glove delivery team.
Everything is, uh, delivered white glove delivery, which means someone will come into your home, unwrap it, assemble it, and take the trash out.
Wow. I love that. That's honestly like, I mean the best part of the, the furniture experience is, you know, buying it because you love shopping and browsing. And the second part is seeing it in full pieces.
Like, I don't think anyone loves assembling things together. Some might no, I,
not, not my thing.
Yeah. Ikea, I I've spent hours, uh, assembling Ikea furniture. It's a great price. It's really difficult time consuming.
Uh, it makes total sense. Um, in terms of furniture designs, I, I know that there are certain furnitures where when you look at it, you know, that's from certain design houses.
And I know a lot of people who sell furniture are buying from the same manufacturer, the same virtually the same product, just brand it differently. Are you guys doing any custom work, like things that are just unique to your brand? Where if I look at it, I know it's from the house we own.
Um, everything, every, every, every SKU we have.
So we have over 50, we have over 50 SKUs and every single, every single one is our own design.
Yeah, then you obviously stand out. Like we got hammer on that point. More like your manufacturing, your price is good, but like most importantly, we know it's yours. Like I think right off the bat that puts you so much above your competitors.
Tell me a mistake that you made in recent years, or even like during this whole founder journey that you look back and say, crap, we could have avoided that.
That's a, that's
a tough question. Cuz there are so many
. That's a typical answer too. Like the, we messed up so many times people don't really realize how many mistakes we make that just never gets talked
Yeah. So I think a major mistake was not doing, uh, research on what people want. And we came out with collection that was really dark and, you know, the market really wanted light natural colors. And we came out with a dark collection and it didn't do well. And we pulled a lot of the pieces. You know, we've put a lot of time and effort into designing, you know, then we have to, we have to ship it to the US have a photo shoot.
Um, so, you know, we had to redo a, all of that and, you know, that was a waste of a lot of money. That was, that was a major mistake. The top of mind one.
And I mean, looking back, could this been avoid it? If you just did some customer surveys, if you just did some like third party market research firms.
Yeah. I think we should have.
I think we should. And we did it after, so I think we should have initially, you know, posted a poll on Instagram cuz that's where, you know, our demographic is and we should have just asked them, uh, which piece do you like more? And we did after. And you know, you know, the answer was obvious, but we just thought let's come out with this cool dark moody, uh, collection.
Yeah. I, I mean, I've definitely made the same mistakes too, where like as a founder and you know, designing your own products, you, you think, you know who you're designing it for. And the data just tells you otherwise, like we recently did a survey with our customers, sent it out 800 people replied and there are things that they told me that I never.
that it was just so against my assumptions. Like I thought people wore our stuff every single day. Half of the people wear us only for special occasions. Um, but I make the, the lashes to be worn every single day. So I thought people were gonna wear them every single day. I thought people would be okay with particular price points, but in reality, there were different about it.
So, you know, at the end of the day, talking to your customer is probably the cheapest thing you could do to avoid the most expensive mistakes.
Especially for, for your yourself is like heavy.
Yeah. Yeah. It's big. It's difficult. It gets damaged. There's furniture's tough. Um, I wonder if you could, uh, come out with like a, a, a special I eyelash that, uh, is just used once in a while.
I don't know another niche product.
Thinking through like, you know, the stuff that you guys sell. Um, that's so bulky and you're, I think you're the only guest I have on my show where your product is heavy and bulky. Um, mm-hmm I want to hear about like, what you think about overstock, what are some of the things that you guys do to, uh, make sure that you're not having too much money tied into your inventory.
And if things don't move, how do you move them?
So we haven't run into that problem yet because we haven't ordered that many of all the pieces, um, we've actually been sold out of all our best sellers for a couple months, which, which has been kind of a disaster. Um, the reason Jordan's not on his call right now, it's because he's living in Istanbul, working with the factory to just, you know, pump out some containers. Yeah. Um, which you know, is happening this week. Uh, so, so far we actually haven't had issues with overstock. Um, we'll see down a line. I know that's gonna come and how we're gonna deal with that I'm not a hundred percent sure to be quite honest.
I mean, on the opposite end of the spectrum, stockout is obviously very detrimental to your business.
Like what are you doing to forecast your inventory? Or, or how do you do it properly?
So we. We're taking the conservative approach. Uh, we're never gonna have too much stock. One of the, um, aspects of our, our business model that we, we kind of like is that we don't sell anything. We don't sell anything unless we have it in inventory.
So like, if you order from like a, a big company, it could take like six months to a year to get, you know, a piece of furniture. Yeah. And that's like the that's common. Um, so we're trying to do it. So we only sell what we have in stock. That being the case, we're, we're trying, we're not gonna over order. So we know we'll sell out of what we get for now.
Maybe we're gonna change that business model as we grow, but we're, we're, we're kind of conservative with, with the quantity that we're purchasing.
That makes sense. And how often does your collection swap?
Swap out. Oh, we probably won't swap out collections for a couple years. So the Ojai collection, uh, is our first collection and that's really, really popular.
Uh, we're gonna keep that for the foreseeable future. Uh, the Kyoto collection, we just came out with a couple months ago and that is gonna be, you know, that's gonna stay for a while. Um, I will say it's funny. Someone else has asked us, like, you know, are you gonna do what clothing companies do and swap out your collections?
It's probably not because it's so difficult to design a collection, then you have to get samples sent to the US. Um, have a photo shoot. It's, it's a little more difficult to, you know, turn collections and take, uh, you know, take them out. But if, if one's not doing well, then we'll take it
Yeah. I, I mean, I'm going through your website right now and I just love how unique it is. Like,
You look at it...
...and that's, you can't find it anywhere else.
Thank you. Appreciate that.
And somehow, like your pictures can show the quality like that. When, when I look at the price point and I look at the picture, I said that that makes sense which is usually hard to do for, for a lot of websites.
So good job on that.
Thank you so much. Appreciate it. It was probably your advice that I followed that it was. You know, you need to with DTC, if you don't have a physical show showroom, you need to have, uh, you need make sure
that you amazing quality pictures.
Yeah. You're able to create this perceived value, um, in your photos.
Mm-hmm and you know, photo shoots are damn expensive, but you're selling something at that price point you need really good pictures . Like selling a home.
Like I I've seen like some homes being sold for like, you know, a lot lower than they could have just because they didn't have good pictures. They, they were out on it.
I'm like, dude, if you guys sell for something that expensive, make sure everything else matches it. The copy matches it. The website matches it. And you guys did a phenomenal job across the board. So good
Well, thank you. We actually tried to do the, uh, 3d renderings. Yeah. The highest quality. But, but at the end of the day, we realize like we need to have a, a, a photo shoot.
We need to, you know, go all the way, do the right thing.
Yeah. I think
renderings are good to an extent, um, renderings are great for like more simple stuff, but for your stuff, rendering is just mm-hmm it's it won't match, it will never match the, the standard that you have. Um,
Wanted to talk to you a little bit more about having a co-founder, especially working with family.
Um, uh, you're probably one of the two, three people who have co-founders that they're related to, that I've talked to others are like marriage or like boyfriend and girlfriend, but like working with family, like how does that work? Like how do you decide what you take on? Do you guys ever have disagreements?
How do you communicate?
It's pretty interesting. Uh, Jordan and I have had have a pretty unique relationship in that we've actually never gotten into any serious fights ever. Uh, we never really fought as kids. We do argue, we still argue Uhhuh , but the arguments don't last long at all. Um, you know, I have other siblings and, uh, I don't know if it would've been the same with them, although like we have great relationships with them as well.
Um, but it's almost like me and Jordan, and I know this is almost, this is almost cliche to say, cuz we're twins. Um, but like we really usually have the same thought process and we kind of know what the other one is thinking. Um, So we work very well together. He's kind of in charge of the design side. Uh, and then I'm, you know, in charge of the business side, but there's major overlap with everything we do.
Um, I know that everything he's working on, he knows everything that I'm working on. And, you know, we, we, you know, talk every day, obviously.
Are you guys identical twins?
if you saw him, you wouldn't, you wouldn't be able, you wouldn't, you would say hi to him. I would say every, I would say every other day, there's someone, someone like comes up to me thinking that I'm Jordan or vice versa.
It happened yesterday. I was at Chipotle and someone like looked at me and then double looked at me and was like, Hey. And I was like, um, I'm Steven, Jordan's twin brother. And yeah, I'm I'm so it's very confusing.
I, I, I'm looking at a picture on Jordan's Instagram of you two together. Oh my god. You're right. I would not be able to tell that apart.
so, you know, we don't, we don't get offended. We get it. Like I'm actually really bad at telling other twins apart. Yeah. Uh, so I get it.
No, it's sick that you guys are able to work together, uh, in a way where it's a lot smoother. Like this is honestly against what most people believe, like working with families is one of the big taboos for a lot of people, but they're usually not twins. Um, and then, you know, starting a business with a co-founder. Usually just have a lot more fights and miscommunications and you guys are able to do that perfectly. So I'm, I'm happy for you. It's good that you guys are able to make it work and build such a phenomenal business.
Uh, last question for you. I would love to hear what is that one advice that you'll give to yourself for when you first start your business? That you learn now?
Uh, I need, I need a second to think about this one.
It's usually, it's usually one of the hardest questions. That's why I save it to the, to the end and the reasons, because there's just so many, it's like, it's like the question of like, what's that mistake that you made?
Um, for, for me, I'll tell you mine. I wish I hired earlier. I, I had this mindset that I could do everything and so I should do everyth. And, and that ultimately made me work a lot slower, grow a lot slower burn out four or five times. Um, cuz I just wouldn't let go. Like I literally re refused to let go cuz I didn't think anyone else could do it better than me.
Which is totally false. Like there are many people that can do it better than me, but you know, when you first start a company Eagles kind of there, and then as you get, as you do a little bit longer, you're like, crap. I don't know shit.
you, you also wanna save money. That's why you don't hire someone.
Um, but I've seen, I've seen other peoples have the same regret as you. Um, and so now me and Jordan are, you know, looking to have our first hire right now. Um, I, I honestly don't, I don't have a, a good answer for that question right now. I'm sure there are many, but I can't think of one out the top of my head.
And that's all good.
It's just, you know, you're still growing and looking back down the line, I'll, I'll ask you the same question again when I see you.
Well, Steven. It is so wonderful to finally have you on a show. We haven't seen each other in like a year now, so definitely need a catch up soon.
much for having me.
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