How to Run a Business in 2020

In recent years, stars have lent their names to all kinds of sneaker collaborations. Puma had Rihanna. Reebok had Gigi Hadid. Adidas had Kanye West. Nike had … Jesus Christ?

Not exactly. In October, a pair of “Jesus shoes” — customized Air Max 97s whose soles contained holy water from the River Jordan — appeared online for $1,425. They were designed by a start-up called MSCHF, without Nike’s blessing.

The sneakers quickly sold out and began appearing on resale sites, going for as much as $4,000. The Christian Post wrote about them. Drake wore them. They were among the most Googled shoes of 2019.

The only thing that didn’t happen, said Kevin Wiesner, 27, a creative director at MSCHF, was a public disavowal of the shoes by Nike or the Vatican. “That would’ve been rad,” he said.

Now, in the MSCHF office in the Williamsburg section of Brooklyn, a pair stands like a trophy.

MSCHF isn’t a sneaker company. It rarely even produces commercial goods, and its employees are reluctant to call it a company at all. They refer to MSCHF, which was founded in 2016, as a “brand,” “group” or “collective,” and their creations, which appear online every two weeks, as “drops.”

Many of those drops are viral pranks: an app that recommends stocks to buy based on one’s astrological sign (which some observers took seriously), a service that sends pictures of A.I.-generated feet over text, a browser extension that helps users get away with watching Netflix at work.

As Business Insider recently noted, the present and future profitability of these internet stunts is dubious. Yet, according to filings with the Securities and Exchange Commission, MSCHF has raised at least $11.5 million in outside investments since the fall of 2019.

In the high-risk, maybe-reward world of venture capital, the group’s antics are well known. Nikita Singareddy, an investment analyst at RRE Ventures, compared MSCHF to Vine and Giphy. All three, she said, offer “lots of delight” and encourage content sharing.

“Sometimes investors are a little too serious about monetizing something immediately,” Ms. Singareddy said. “With MSCHF, there’s faith that it’ll pay off. There’s an inherent virality and absurdness to all the projects that they’ve created, and it’s something people want to share and ask questions about.”

For starters: What is it?

‘This Is How We Live’
The MSCHF office says as much about the company as any of its products.

A giant white pentagram covers the entrance floor. On a visit in December, an inflatable severed swan’s head dangled from a ceiling beam, and a rubber chicken bong — a recent drop — sat on a coffee table, full of weed.

“My mom thinks we make toys,” said Gabriel Whaley, 30, the chief executive.

MSCHF has 10 employees, nine of whom are men. The company Twitter and Instagram pages are private, so most of its direct marketing takes place not on social media but through text messages from a mysterious phone number.

Though the team used to run a marketing agency, working with brands like Casper in order to fund MSCHF projects, they stopped taking on clients last year. Now, they pretty much do whatever they want.

“The cool thing that we have going for us is we set this precedent that we’re not tied to a category or vertical. We did the Jesus shoes and everyone knows us for that, and then we shut it down,” Mr. Whaley said. “We will never do it again. People are like, ‘Wait, why wouldn’t you double down on that, you would have made so much money!’ But that’s not why we’re here.”

The point, he said, is to produce social commentary; the “story” the sneakers told was more important than turning a profit. “There are several youth pastors that have bought a pair, and even more who are asking, like, ‘I love sneakers, and I love God. I would love a pair of these,’ and that wasn’t the point,” Mr. Whaley said. “The Jesus shoes were a platform to broach the idea while also making fun of it: that everybody’s just doing a collaboration now.”

In order to prepare each drop — be it an object, an app or a website — MSCHF’s employees log long hours. Most mornings, Mr. Whaley gets to the office around 7; the rest of the team arrives by 10. They often stay late into the evenings, conducting brainstorms, perfecting lines of code, shooting live-streams or assembling prototypes. Weekends, Mr. Whaley said, aren’t really a thing.

“It’s not just a full-time job,” he said. “This is how we live. The distinction between your work and normal life doesn’t really exist here, and it’s just because this is what we were all doing whether we were getting paid or not in our former lives. So nothing has really changed, except we have more power as a unit than we did as individuals.”

Link: https://www.nytimes.com/2020/01/30/style/millennial-entrepreneur-startups.html