How Solo Stove Turned a Backyard Fire Pit into a $400 Million Worth Company

Jan. 1, 2024

This is the Solo Stove, a smokeless home patio campfire stove and outdoor camping stove. Founded in 2011 by two brothers from Texas, Solo Stove has grown from a kickstarter campaign to a valuation of $2 billion when it goes public in 2021.

Jeff and Spencer Jan built a company worth $400 million with a cult following without reinventing anything.
Rather, they “redefined fire.”

Here’s the story of how Solo Stove turned a backyard fire pit into an outdoor lifestyle brand with over $400 million in annual sales.

Start in the garage

Jeff and Spencer loved the outdoors and wanted to start an e-commerce business. It started by just tinkering around with something and browsing on YouTube, and they discovered something called “secondary combustion.” The idea is based on hot air being thermally circulated in the stove and eventually combusted. Simply put, the secondary combustion process produces a flame that is hotter and burns cleaner than an open flame. This is the key to their technology.

After launching on Kickstarter in 2016, the stove hit its $15,000 goal in just two hours and ultimately raised more than $1.1 million.

Adding fuel to the flames

To expand the business, John Meyers was appointed CEO in 2018. Melis has high praise for Solo Stove: “I think what Jeff and Spencer are doing is very cool. They make it easy for ordinary people in communities and towns to have campfire-style outdoor activities.”

The Solo Stove’s patented stainless steel design features double walls and vents that create a “natural vacuum” effect that brings in extra oxygen. The result is that the fire burned is about twice as hot as a typical campfire.

“Because it’s hot, it burns more efficiently,” Melis said. “Efficient combustion reduces smoke and ultimately creates a better experience around the flame.”

The appeal of a fire without smoke is pretty obvious, especially if you’ve ever spent a fun night sitting around a campfire. But it was ruined by a sudden change in wind direction and a puff of smoke. When Melis joined, he expanded Solo Stove’s reach — building out its e-commerce business, partnering with national retailers and relying on social media and word-of-mouth for marketing.

The Solo Stove’s patented design features a double-walled cylinder with vents on the top and bottom that creates a “natural vacuum” effect that allows the fire to burn nearly twice as hot as a traditional campfire.

Solo Stoves originally started in sporting goods and outdoor stores like Dick’s Sporting Goods and has since expanded to national retailers like Home Depot, Lowe’s, Amazon and Walmart. The company had revenue of $130 million in 2020, up from about $16 million in sales in 2018.

The product is perfect for the pandemic era, Melis said: “People are stuck at home. They’re looking for things to do, and Solo Stove has clearly become their go-to… to break up the monotony of your day.”

With Solo Brands gaining momentum, Merris decided to expand aggressively, acquiring direct-to-consumer brand Oru Kayak, paddle board maker Isle and outdoor apparel brand Chubbies in 2021. The company is currently on track to post record annual revenue, with total sales of $320.4 million through the first three quarters of the fiscal year.

Merris said that while those acquisitions do help, the bulk of the funding — up to 70 percent — still comes from Solo Stove.

Targeting “One Billion Brands”

The Solo Stove makes sense for anyone who wants to build a backyard campfire. But the brand’s explosive growth and cult following appears to extend beyond this demographic, thanks to an extra factor: a cool factor.

The company offers “upgraded technology, upgraded innovation,” said Peter Keith, senior research analyst at Piper Sandler. He added that it had succeeded in breathing life into a home furnishing market that had become “obsolete and stale.”

Solo Brands aims to make its stoves at least relatively approachable, offering a variety of styles, sizes and price points to entice new consumers to try the brand. Stoves range from the 7-inch-wide tabletop fire pit Mesa ($104.99) to the 27-inch-wide Yukon and Yukon 2.0 ($459.99 and $149.99 on the company’s website).

It worked at first: Solo Brands’ IPO in October 2021 valued the company at more than $2 billion.

But the company’s stock price has plummeted nearly 75% in the past 16 months. Today, the company is valued at just over $400 million, partly because the stock market has been “pretty brutal” over the past year, Melis said.

Almost all Solo Stove products are manufactured in Asia, especially China, and the epidemic has unexpectedly increased transportation costs. In 2021, Apple introduced permissions to prevent apps from being tracked, resulting in an increase in customer acquisition costs for different types of companies. And the deeper consumer factor is that after most users with backyards buy Solo Stove, they will not buy another Solo Stove product again – because it is stainless steel and will last a long time.

Solo Brands’ year-over-year revenue growth also slowed in 2022 after rising sharply a year ago — a possible sign that consumers are buying just one Solo Stove each rather than becoming repeat customers.

Melis said the company’s range of stoves and acquisitions of other brands could help drive the shift. International expansion could follow, pushing Solo Brands toward Merris’ ultimate goal of reaching a $1 billion market capitalization.

But in reality, the CEO is betting on a more visceral feeling: passing time around a campfire, chatting or eating, without the rude intrusion of billowing smoke. It’s an atmosphere where you can have really deep, meaningful conversations. This is more than just a pastime. Your life can become calmer and sweeter when you have a fire in your backyard.


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