In June 2015, one of Randy Hollister’s sons was sitting with a buddy in Juggheads Growlers & Pints in Winston-Salem, North Carolina, trying to come up with a housewarming gift idea for a college friend who had just bought a house. As they watched people come in to get their growlers filled, he thought, “What about a kegerator for growlers?” He couldn’t find one online and made a call the next day: “Dad, I think there’s something you need to invent.” And that’s how Hollister started Myrtle Beach, South Carolina-based PenguinTap.
“It was hard to believe it wasn’t already out there, but I went to work designing what the product needed to do,” he says. “By August 2015, I had spoken with enough people and engineers that I was comfortable making the decision to go for it and the company was launched.”
The company’s flagship product is the Growler Chill. In March, the company concluded a successful 33-day Kickstarter campaign that raised more than $650,000 in pledges from nearly 1,800 backers. The kegerator can be purchased online at www.GrowlerChill.com, and Hollister says the company is on track to start shipping in late August.
“Based on the pace of current sales and our production timetable, we expect to remain in a preorder situation through the first quarter of 2018,” says Hollister.
If You Build It, Will They Come?
So is it a matter of “If you build it, they will come”? Well, when you consider the popularity of craft beer, maybe. But Hollister is also a seasoned entrepreneur, having co-founded two prior successful startups in the real estate technology space. He says there are many differences—”With software, you can continue iterating and tweaking and adjusting after you ship. With hardware, once that device is on someone’s countertop, you can’t adjust the insulation thickness or the ventilation capacity so you have to take much more time at the front end to get it right,” he explains.
But there are also similarities, such as identifying a product that satisfies a genuine market need. “Every craft beer lover who has used or wanted to use a growler knows the problem,” he says. “As soon as you take that cap off to pour the first delicious beer, carbonation comes out of the bottle and oxygen gets in and both of those start to change the beer, and not in a good way. Within hours, the beer is no longer the same as it was when you bought it.”
Growler Chill solves the perishability problem by recreating in the growler bottle the conditions that existed in the keg to keep beer fresh for weeks after opening. Knowing the beer can be kept for up to three weeks after opening lets craft beer lovers bring home more variety without fear of it going bad.
His best piece of advice to new entrepreneurs: “First, make sure you have a real product or service that somebody will buy at a price for which you can afford to sell. I do some mentoring for Startup.SC and have seen plenty of pitches. Not every cool idea has a market. Before you go too far down the path, make sure you have that nailed down.”
Challenges With Any Startup
Despite this not being his first rodeo, Hollister says the launch process has not been without hiccups. “When you have to rely on external vendors and suppliers, you don’t have absolute control of the schedule,” he says.
As an example, one of his prototypes had a panel on the front which needed to be chromed. It was supposed to take 10 days to get it back. But the vendor’s chroming equipment broke. After a week, equipment was still broken, so Hollister took his business elsewhere. But that vendor’s equipment also broke.
“I understand equipment breaks, but it ended up taking three different vendors and eight precious weeks to get that one simple prototype part chromed,” he says.
The location of his startup also has presented some challenges.
“For most entrepreneurs, funding needs are pretty high on the list of startup support questions,” he says. “We did not have any trouble at all finding local seed round investors, but there is not a large angel community or VC operation here, so for our upcoming capital round we’re expanding our search beyond the local community.”
Finding talent is also an issue. “The tech community in Myrtle Beach is relatively small, but growing,” he says. “We have some catching up to do with our neighbors like Charleston to the south and Wilmington to the north. That means the pool of local tech talent is much smaller and that can pose a problem for companies that need in-house personnel.”
Case in point: At a recent Pitch Night hosted by the Grand Strand Technology Council, four of the presenting companies included a pitch for their hiring needs.
You Can Start Up Anywhere
“The other side of that coin, though, is that we are a desirable place for people to relocate to with low cost of living, affordable housing, incredible entertainment and recreation options, and a beach!
“With most products and services today, you can be anywhere,” he continues. “With all of the online collaboration and communication tools available today, you don’t have to be in Silicon Valley or Boston or Austin to do a startup. If you can be anywhere to start your business, why not the beach?”