Yeti Holdings Inc., the formal name for the cooler company we all know, filed for an IPO this July with little fanfare, but The Wall Street Journal now reports that the tiny Austin-based company is seeking a not-so-tiny valuation of $5 billion, which could come as soon as October.
Surprised? You should be. That figure is 36 times Yeti’s 2015 earnings. While it still has to convince investors it’s worth the price tag, there’s no question that the company has seen explosive growth in recent years, with sales in 2015 triple those of 2014 at $469 million.
Brothers Roy and Ryan Seiders launched Yeti in 2006 with a simple mission: to build coolers that could not only withstand the test of time but also endure the abuse of a life lived outdoors. They wanted to make the kind of coolers people like them would buy, people who grew up fishing and hunting in the American South.
What started as a niche, but quality, product soon expanded into a mass-market brand for outdoorsmen, tailgaters, and backyard barbecuers everywhere. Not only are there Yeti coolers and ice buckets these days, there’s also clothing, hats, and drinkware, the latter of which accounts for the bulk of Yeti’s sales.
So what sets Yeti apart? In its own words (from the July 1 filing):
We have become a trusted and preferred brand to experts and serious enthusiasts in an expanding range of outdoor activities... Their brand advocacy, combined with our various marketing efforts, has broadened our appeal to a larger consumer population.
Following the lead of companies like GoPro, Yeti sought out influencers and made brand advocates out of them. These so-called Yeti Ambassadors include world-class hunters, anglers, rodeo stars, and adventurers who embody the outdoor spirit. It also built up a loyal base by producing short films, which are distributed through its social channels, and sponsoring key industry events, including sportsman shows, rodeos, barbecue contests, and fishing tournaments.
But does all of this amount to a $5 billion company? And can Yeti scale up and remain innovative without loosing its authenticity? That remains to be seen.
Yeti’s shares may soon trade on the New York Stock Exchange under the YETI ticker symbol.