43. Randy Hopper - Vexus Boats - Spearheading Industry Innovation

Robert Wagner:

All right, our guest today is Randy Hopper. Randy is the CEO of Vexus Boats. Vexus manufactures premium fiberglass and aluminum bass boats in Flippin, Arkansas. Vexus Boats has an amazing story. It's really a startup company with a 50-year history. We're going to get into all of that with Randy as we go along here. Just more background, Vexus broke ground on a state of the art manufacturing facility in Flippin in August of 2017 and less than a year later they were already shipping aluminum boats to the newly created network of Vexus bass boat dealers. So, we're going to get into all that as I said, including just how this company was able to hit the ground running at almost full speed. So, Randy, welcome to the How'd That Happen podcast.

Randy Hopper:

Thank you very much for having me.

Robert Wagner:

Yeah, I'm really looking forward to our conversation. This company has a very interesting background and you've played such a huge part in it. I'm anxious to hear more. So, Randy, I want to start with just a really basic question because we have listeners from all over the place and all different backgrounds and not all would be familiar with the bass boat industry. So, again, the most basic question of all, what makes a boat a bass boat?

Randy Hopper:

Well, a bass boat is generally believed to be a bass boat when it has elevated decks, front and rear, for casting for bass fishing, freshwater species, large mouth, small mouth, spotted bass, that are prevalent all across the country and in other parts of the world as well. We actually build freshwater fishing boats that are outboard powered, so we do a lot of walleyed boat, a lot of things that we call crossover boats so that you can fish multiple species. But the bass boat is really... the tag hangs on the bass boat because early on that was the species that the boats were really developed around and they were a real forerunner of a lot of specific features that were conducive to bass fishing.

Robert Wagner:

Gotcha. Okay, thank you for that explanation. So you started Vexus in 2017, manufacturing bass boats, and of course you mentioned crossovers, but mainly bass boats and for that industry. I looked real quickly. I found 17 brands of bass boats out there. All of them are well-known brands, Bass Cat, Nitro, Ranger, Tracker, Tritan, I mean some of those you had a major impact on yourself. I guess my question is, what's left to be done? What was the opportunity you saw in the manufacturing and sale of bass boats that no one else was doing that needed to be done?

Randy Hopper:

Well, I don't know that there was a looming opportunity. If I could go back just a little bit and tell you a little bit about my career, perhaps I could better answer that question.

Robert Wagner:

Sure.

Randy Hopper:

I started out quite young when our company at the time was Ranger. We were just getting started. Ranger celebrated 50 years a couple of years ago. It started in 1968 and shortly after that, I joined the founder, Forrest Wood, and was just a kid looking for a part-time job actually, but I learned what we were doing, the way it was happening. We were constantly in growth mode, and we were innovators in the business, and to me that was the fun part, and always looking for a better mouse trap, looking at the automotive industry, knowing that what people drive and the features and benefits that they see in their automobile is often times something that they find lacking in a boat and they wanted those kind of features.

Obviously, they're two different things all together, but there's a lot of similarities as well. So, that's where I found the intrigue. We went through multiple owners. Forrest Wood, who later became my father-in-law, sold the company, the family sold in 1987, but both of us stayed on. Him in more of an advisory position and promotional. He was a professional fisherman, so he still hit the tournament trails for a few years after relinquishing his ownership. I stayed with it and I was the Head of Engineering and Manufacturing for a long time. For the last 26 years, I was the President and CEO of Ranger. We enjoyed a great customer base and had a wonderful following of people.

We went through a corporate ownership with Genmar, which was kind of the General Motors of the boating industry. I worked for them running the company for 18 or 19 years I believe. That was a great experience in a corporate culture. Then in 2015, actually during the economy downturn in 2009, Genmar, our parent, filed bankruptcy. We were a real cash cow, a real profitable company, but overnight our sales fell over 50% and it certainly didn't last long fortunately, but Genmar, our corporate owner, wasn't positioned from a cash standpoint to weather that kind of storm.

So they filed bankruptcy and a private equity group called Platinum Equity bought us. We were real fortunate, I believe, that we got an excellent partner in that private equity group. The guy that was the lead on that named Louis Sampson was just real understanding and I think he saw that we could run the business, and he let us do that. We did that for about five years and an opportunity came to sell the company. So, it was sold and I stayed on even then. It was more of a corporate large company, Bass Pro Shops.

They knew the business and I felt like it was a good strategic owner for the company, and probably still believe that, but they had a different way of doing things, not to say it was wrong. It was fine, but at that stage in my life, I felt like there was probably... I didn't want to do it that way. So, one long answer to your simple question of what do we see in the future, it was just that desire that we weren't finished, wanted to take this-

Robert Wagner:

Amy?

You there Randy?

Randy Hopper:

Yeah, I am now. What happened?

Robert Wagner:

I don't know.

Randy Hopper:

Oh.

Robert Wagner:

I don't know.

Randy Hopper:

I think I may have muted it with my ear and I don't know at what point in time that happened.

Robert Wagner:

Yeah, I think that's what happened 'cause I found the mute button there and when I clicked it off you came back.

Randy Hopper:

Okay, I'm sorry about that.

Robert Wagner:

That's fine, we'll just pick it up. We'll pick it up. You were saying long answer to my question and you wanted to do something different. You didn't want to kind of go down the path at this stage of your life with the Bass Pro way of doing it.

Randy Hopper:

Okay.

Robert Wagner:

You can pick up anywhere in there.

Randy Hopper:

Okay, yeah. The company sold to Bass Pro and felt like they were a good strategic owner, but larger corporations have a way of doing things and perhaps a little different than I was used to doing it, so I felt like at that point in my life, I had about 46 years in the business and wasn't quite ready to quit, and felt like there were some things that could be done differently. We had run quite large, so it was hard to give that real individual personal attention to each customer that we had built the company on. So I felt like with starting over we'd be able to do that again.

Robert Wagner:

Gotcha. So, you have several things there that interest me. You worked for Genmar, which was, you described it as the General Motors of the boating industry, so a large corporate, conglomerate might be too strong a word, but something like that. They had a family of brands, right? Then you worked for the Private Equity Group and then you went back and did some time with Bass Pro. What did you learn working for different types of folks like that?

Randy Hopper:

That's a really interesting question. I've thought about that a lot. It just seemed like the path that I was on, each owner offered something interesting and different, and I was kind of the student of management and how that all fell into place. We were homegrown when we sold out in 1987. We had starting building projects 17 years before, or 18, and really hadn't stopped. We had a fire that burned our plant down. So we were what I'd call homegrown. We didn't have a lot of expert management skills. Forrest was a very, very charismatic person and a strong leader, and I think that alone really kept us focused on what he believed were the core principles of the company. We didn't really know what that was or what it was all about, but looking back, that's exactly what we were doing.

So when we were purchased the first time, it was a group of investment of private wealth of some individuals. They were a little bit different. They were trying to become a well-managed conglomerate, if you will, with a lot of different industries, and they'd actually bought another boat company before us, which was Carver Yacht. So, I learned some things there certainly that were very valuable. And then when we got hooked up with Genmar, it was through a man named Irwin Jacobs, who has recently deceased, but was a good friend of mine and a very controversial person in our marketplace and in other markets too. I think he made his name as a corporate raider in the 80s. He was very well known by a lot of people. But even that, I was able to learn a lot from just being around him and seeing how the different aspects of business should be managed.

We were really positioned well when it came to the big turndown in 2009. We had been running the company. Although we were part of the corporate structure, we were a little bit off the beaten path here in Arkansas, so we'd been running the company pretty well. There were some helps from the purchasing, liable, and buying power and so forth that helped us along the way being part of the Genmar group, but generally we ran the company and they let us do it autonomously.

Robert Wagner:

That's awesome. I have heard the name Irwin Jacobs, corporate raider days, his name and Carl Icon and those guys.

Randy Hopper:

Yep, yep, Carl [crosstalk 00:18:43].

Robert Wagner:

Yeah, another thing that you mentioned just in your background there was running the engineering group. Is that your technical talent is kind of around engineering?

Randy Hopper:

Well, I don't have any formal engineering training as such, but when we were starting the business, there wasn't such a thing as a bass boat so we had to design and kind of write the book, if you will. We invented such things as aerated live wells to keep fish alive. Mr. Wood had a vision that in order for us to continue to enjoy selling boats to people to catch fish, that we needed to have a conservation effort in place to ensure that that happened, and of course catch and release was not heard of. It was release to the grease back when we first started. But it wasn't long til we started understanding that conservation was going to be a big part of what we did, because we were considered to be the number one tournament boat in just a few years, and that means there's a lot of organized bass fishing tournaments across the country at various levels and we were right in the middle of all of those.

In fact, the Bass Master Classic would be the equivalent to the Super Bowl or World Series, just pick your sport. But the Bass Master Classic was and still is the World Series equivalent and we were the official boat sponsor for 29 years consecutively. So we invested a lot of time, effort, and energy into knowing the business, knowing what fisherman were wanting, listening very closely, and then trying to engineer or develop those features around that. So yeah, I think that's exactly where I like to be. When I needed to get away, I went to the engineering shop. Even when I was the president, that's where I hung out. That was my passion and still is, and it is now to give me an opportunity to really try to take product to the next level here at Vexus in this stage in my career.

Robert Wagner:

Yeah, I guess the other reason I asked that question is that in talking to my colleagues on the phone who know you and have been to your office, they made note of your sketches and the amazing drawings that you have collected and done over the years, so you seem to have a skillset in that area that maybe just came naturally to you.

Randy Hopper:

Right.

Robert Wagner:

What are the innovations that Vexus is bringing to the bass boat industry?

Randy Hopper:

Well, a lot, but I'll tell you the one thing that we really wanted to do and that was change the paradigm. There's a system, or molding process, called open molding where fiberglass have been built this way from the beginning of time, where they're sprayed or brushed or rolled into a mold in the case of a hull. But it's done open to the atmosphere and there's a lot of BOCs and fumes, and it takes a special environment because you have to change the air very often to get rid of the [inaudible 00:22:05] fumes in the case of polyester resins. We wanted a better mousetrap, so when I left Ranger the first thing I did was start working on that process that I could later parlay into the boat building.

I started building, actually the deer blind was the product that I had chosen because it didn't interfere with my noncompete at all, and I learned, developed, explored, and engineered a process that we now call infused composite construction whereby we build everything under vacuum, under a bag, which is a much, much cleaner environment. It allows you to air condition the facility for example, which was kind of unheard of in the open molding side because you had to change the air so often.

So, that's one of the innovations we brought. We don't have any open molding in our plant. Its all done under a bag. It's much cleaner, its more consistent, it's lighter weight, and its stronger. So we get all of the good things. Unfortunately, the only down side is it's a little bit more expensive, but people have shown that they're willing to pay more for that. So that's the process that were using now and will continue to.

Robert Wagner:

Yeah. That's great stuff and it checks a lot of boxes that are becoming more and more important as we evolve and we tackle the environmental issues and things. Certainly much better for the workers, right, to work in that kind of environment?

Randy Hopper:

Absolutely, mm-hmm (affirmative), and the environment.

Robert Wagner:

What are the innovations that the fisher person is feeling if they're on the boat, in the boat, using the boat?

Randy Hopper:

Well, I'll tell you one and as I've said, there are lots of them, but one of the ones that we've incorporated and have a patent pending right now is just view a live well as a 20 gallon bucket half full of water and when you put your fish in to keep them alive and you run 20 miles back into the tournament weigh in with the fish sloshing around, you can do some damage to them. So, one of the things that we invented was a live well that we call a flood live well. So we can fill it all the way to the top and we have a sealed lid so it's really like it's almost under vacuum because it's completely full so it doesn't slosh.

We've videotaped a full live well of fish, you know 15, 20, 25 pounds of bass riding around in the roughest conditions you can navigate in, and its very smooth in that condition because there's no slosh. It seemed like a simple thing but it's... and then the good part is that we have developed the electronics so that you can switch that from one mode to the other, so 90% of the time you perhaps don't need that, but when you do, you do need it and you can just with the flip of a switch change it over to the fill mode and enjoy what I just described to you. So, there's one of the innovations that people have picked up and are liking.

Robert Wagner:

Yeah, that's fascinating. I totally get that. You get the environment for the fish that they're used to, right, as you say, no sloshing?

Randy Hopper:

That's right, that's right.

Robert Wagner:

Very interesting. So how much technology, you mentioned electronics in relation to that innovation, how much electronics and technology are in boats now?

Randy Hopper:

Its really unbelievable. You know, there's very few analog instruments on the boats any longer. Its all done with digital switching, and the most important thing are the fish finders. Often times, you will see three to four screens, two in the bow, two at the console, that fisherman will use to scope or to look for their fish, so we have wide scope, we have certainly down radar that's looking in the down position, we have it looking to the side. It's just pretty amazing. And then the trolley motor companies have also, in collaboration with electronics people, now we have GPS guided trolley motors so you can lock onto a specific spot if you find fish and you're trying-

... and the related accessories.

Robert Wagner:

Okay. Randy, I'm sorry you hit the mute button again.

Randy Hopper:

Is it working now?

Robert Wagner:

It is now. Yeah.

Randy Hopper:

Wow, I must have hit it on and off. I'll try to hold it away from my ear a little bit.

Robert Wagner:

Let me get back to where you were. We were talking about electronics in the boat and you were talking about... maybe pick it up with the trolley motor guys.

Randy Hopper:

Okay, okay.

Robert Wagner:

The GPS.

Randy Hopper:

The people who build the trolley motors, and that's simply a device that you can move the boat around at very slow speeds while fishing, they're working in collaboration with the electronics, the fish finders or fish sounding equipment, they're working with them and now we have equipment that will actually lock on a spot so that if you're out fishing and you find a school of fish and you're trying to catch them and the wind's blowing, that trolley motor will keep you right on that same spot. It's pretty technical as far as the navigation part of it and the sonar that you're finding fish.

It goes further than that, we even have shallow water anchors, we call them, that just the push of a button will lock that boat down in the back in up to 10 foot of water so you can stay oriented exactly like you want to for making your lure presentation. Pretty technical machine actually.

Robert Wagner:

Wow, wow. So, Randy you've been in the industry for a long time. What innovations have you guys developed or have you seen developed in the bass boat realm that have jumped over to other parts of the boating industry over the years?

Randy Hopper:

Oh, I don't know that there's... and there is a lot. I think we set the bar for fit and finish in a lot of products early on. As I said earlier, we always used the automotive industry for the benchmark for some of the things and the look that we wanted to get, whether it was styling or feature rich components. I see that a lot of bass boats were no doubt the most advanced fishing machines on earth. In my previous employment, we built a lot of saltwater bay type boats too, and we started using a lot of those features in the saltwater side and they caught on quite well because they were advanced over what the status quo was in that industry.

Robert Wagner:

Yeah. Where did the name Vexus come from?

Randy Hopper:

It was just a made up name. Somebody asked me what it means and I said, "Well, to us it means best boat built," and 10 years from now we hope everybody agrees with us. They're easier to trademark. We had a lot of ideas on design wise. It felt like a V needed to be in the name. An X is a good balance in the middle, so when you put a V at the start and an X in the middle, it doesn't give you a lot of choices, but we felt like we came up with something that was very modern and it feels good.

Robert Wagner:

Yeah, it does feel very modern.

Randy Hopper:

Right.

Robert Wagner:

In looking through your website and watching the videos, it looks like your boats are sold with 150-200 horsepower motors, maybe larger, for the most part.

Randy Hopper:

Mm-hmm (affirmative).

Robert Wagner:

I get it if you're a professional bass fisherman and you're fishing tournaments, but for the rest of us, why does speed matter, or does it?

Randy Hopper:

Well, again, I think I would have to take that back to the automotive industry. I bought a Z28 Camaro new in 1972 and I think it had like 300 horsepower and I thought I was on top of the world, and I just got a Suburban the other day that I think has over 400. Do I need that? No, but I know the pedal that controls it, so just back off, and that's the way we do with Outboard motors. They've made them so dependable. They've made them lighter. They're four-stroke now so you don't have to mix oil with them. I've never had anyone complain about their boat going too fast, because as I said, just pull back on the throttle handle. So your hole shot and pulling skiers, 'cause our boats are used by the family, and we build a couple of center consoles that are just very much multi-species and just real fun boats. They're used not only to fish but to have fun out of.

Our average engine for the fiberglass boat has to be... we put lots and lots of 250s on, and a lot of 300s and 350s, so I think our average there would have to be pushing at 275 mark. Then on the aluminum boats, it's probably 150 horsepower.

Robert Wagner:

So if you're in a fiberglass boat and you have a 300 horsepower engine and you're running it full out, how fast are you going?

Randy Hopper:

Well, it depends on the boat that its on, but on the bass boats, they're going to run in mid 70s.

Robert Wagner:

Wow.

Randy Hopper:

And the multi-species boat, with that same engine, because it's a higher side, more wind resistance, it's going to run in the high 60s. They're plenty fast and there are places you can use that and there are places you can back down. But our real claim to fame on the restart has been building boats that are lighter, stronger and faster. They're lighter because of the process that I explained earlier, the infusion process, and they're stronger because the materials were using and the glass to resin ratio that we can achieve because of that infusion process, so it just stands to reason that our boats are going to be able to go plenty fast and be plenty strong too at the same time.

Robert Wagner:

Yeah, that's great. So Randy, kind of final question before we head into our final list of questions that we ask everyone, but do you see disruption coming to your industry, or what might that be?

Randy Hopper:

Well, there's always that opportunity of course. I tell you what we do see, on the positive side, since this COVID thing hit, is we see people that are, I call it getting back to the basics. We're seeing a lot of first-time buyers. People are going out to the water and to the outdoors in general to kind of get away from it all and there is no better way to enjoy family than to be out, and often times on the water is a part of that. Forrest had a saying and we go back to his basic philosophies a lot, but can't prove this but you can't disprove it either, he just felt like people that spent time on the water and in the outdoors just made better citizens. I think we're seeing that call. It's happening. Would we have predicted it last March? No, I certainly wouldn't have, but it definitely has happened. Our industry, for example, has the 13 or 14 weeks less inventory in the field than it had this time last year.

Robert Wagner:

Wow.

Randy Hopper:

So, that tells you.

Robert Wagner:

That's a whole quarter's worth.

Randy Hopper:

It is. It's a quarter's worth of business that people went out and bought product. We hear of all sorts of folks, and there's some people that are going back to the water, going back to fishing. It's a way to social distance. It's a way to enjoy the family that you don't have intrusion. Then were hearing of people that are saying, "You know, I need somewhere to get away from my family. I've been on the treadmill for long enough." And people are buying a boat and that's good, but it's even better when you hear a year from now and you hear them say, "You know, that's the best thing I did." We feel like it's a good business to be in.

There's always things, you know administrations change and policy changes and so forth, but that's one of the good things I guess about being around in this business for 50 years, there's always a reason to believe that it's going to be better and there's always something to be scared of, but that's just part of doing business.

Robert Wagner:

I think I know the answer to this question, but is the self-driving boat here already, or is it coming? I get the feeling that we want to go fast, so if we want to go fast, we want to be driving it.

Randy Hopper:

I think so. I think the technology will develop over the years, but boating, as it should be, is behind the automobile and we're not seeing those to the level that I think we were promised by 2020. It takes a while to get to that adjacent normal and I think it'll take a while for it to transform into the boating side. You know, you're kind of taking away the fun and I think that's part of boating, so you got to be careful about taking away the fun and I think that's really what that would do.

Robert Wagner:

Yeah, I think you're right. I think your answer about going 70 miles per hour on the water, that's not near as much fun unless your driving.

Randy Hopper:

That's right.

Robert Wagner:

Okay, well that's a great spot to end. Randy, we've got five questions that we ask every guest, so I'd like to launch into those. You ready?

Randy Hopper:

I'm ready.

Robert Wagner:

All right, so what was the first way you made money?

Randy Hopper:

The first way, I guess I'll need some explanation for that.

Robert Wagner:

Well, what's the first time that someone paid you to do some work?

Randy Hopper:

Oh, me personally you're talking about.

Robert Wagner:

Yeah.

Randy Hopper:

Oh okay. Yeah, it was doing body work when I was like 12 or 13 years old.

Robert Wagner:

On cars?

Randy Hopper:

That's right, mm-hmm (affirmative).

Robert Wagner:

So if you were not leading and letting Vexus boats, what do you think you would be doing?

Randy Hopper:

I think I'd be trying to figure out how to build another boat somehow.

Robert Wagner:

You just got boats in the blood, right?

Randy Hopper:

No, if I wasn't doing Vexus right now, I love restoring old cars, automobiles and working on cars, so I'd probably be heavier into that.

Robert Wagner:

Gotcha, okay. Third question is what would you tell your 20 year old self?

Randy Hopper:

Oh, I think learn all you can, listen more than you talk, recognize an opportunity, it's not always dressed up like opportunity. Sometimes when others are thinking that it's bad, it could be very good.

Robert Wagner:

That's really good. Very, very good. So Randy, what will the title of your book be?

Randy Hopper:

The title of my book, I've never thought of that. Wow. That takes the... that's thought provoking. This other stuff's been easy. I guess it would be It Takes a Good Team.

Robert Wagner:

Yeah. That's good. That comes through in talking with folks who know your company and comes through on the company's website. It's very clear that it's very much a team aspect, so that's good.

Randy Hopper:

Yeah, we hope so. I'm glad to hear you say that because that's what we strive for. We're not real big on titles. I certainly am not. I think sometimes you have to have one to convince someone to loan you money or whatever, but its basically we're kind of a bottoms' up organization. We want people out on the line. That's where the good innovation comes from really. You know, I can steal some ideas, but they usually come from people who are in it knee deep every day. So, that's what we try to do. I decided a long time ago that I was going to have to work for a living, so why not enjoy it.

I told people that in the first 46 years that I worked in the previous job, I could count on my two hands the days I dreaded going to work, and I realize that's not something that a lot of people can say, so I'm real blessed in that regard. It was divine intervention. I'm really cognizant of that and trying to create that for other people so they can have fun while they work. I think you build better products and things just turn out better if you have that kind of an atmosphere.

Robert Wagner:

Yeah, having fun is key.

Randy Hopper:

It is. Yeah, it is. Some days are funner than others. Some days it's a grind, but generally speaking you should be able to look back over the last week or the last month and say, "You know what, we had a pretty good time doing that."

Robert Wagner:

Yeah, even things when they're hard sometimes you can have a good time. So last question is what's the best piece of advice you've ever been given?

Randy Hopper:

Best piece of advice. Well, I don't know. I attribute a lot of things in my style to Forrest because I was so close to him and worked with him for many years, but I think probably the best advice is to just hang in there. Payday's not always Friday. If you keep doing what you believe is the right thing, in the end, whenever that is, at a particular juncture that you can call the end of whatever you're working on, it usually will work out in your favor, and I think that's right. Don't worry about who gets the credit, just get it done.

Robert Wagner:

Well, that's a great spot to end. Payday's not always Friday. I love that.

Randy Hopper:

Yep.

Robert Wagner:

Well, Randy thanks so much for being a guest with us. If folks want to hear more or see more, or learn more about Vexus boats, I think it's pretty easy. Is it vexusboats.com I think?

Randy Hopper:

It is, it is. Yeah. Come and do that. We take tours if you call ahead we'll be happy to show you what we're doing and the growth that we're experiencing, and hopefully get you excited about getting a boat, catching a fish, getting out on the water, enjoying your family.

Robert Wagner:

Yeah, that's great. Thanks again, appreciate it.

Randy Hopper:

Hey, thank you. Appreciate it. Goodbye.

Robert Wagner:

Bye.

All right, thank you so much Randy, appreciate it.