In the middle of LA there is a tin roofed warehouse that houses a machine shop. Behind that there’s a brick building dotted with loading dock doors. Behind this is are a row of taller, better looking warehouse slots spottily occupied by businesses and non profits. Tucked up against the Los Angeles River behind all of this is a obscure, low slung office building with no markings that, over the past decade, has become the physical totem of west-coast skate culture.
The Berrics was started by Steve Berra and Eric Koston (the collective’s name is a portmanteau) as a place for kids to skate without getting hassled on the street. Both are legendary skaters that have managed to ride the wave of booms and busts that have characterized the business of making skating your life over the past thirty years. Over that time, skating the business may have ebbed and flowed, but the culture never died and thanks to its influence on street fashion, music and pop culture, its influence can be felt everywhere.
Now, The Berrics is being acquired by Hypebeast and they’re forming a new company “The Berrics Company”, with the express mission of making sure the particular spirit that it was founded to foster in skating never dies. Hypebeast is putting in $750k and ending up with 51% of The Berrics and a majority of board seats. The Berrics will contribute its approximate $2.5M in assets, $1M in liabilities and a board seat. Hypebeast has been on a bit of a tear on the markets, with genuinely solid increases in revenue and profits over the past year, so this seems like a smart small acquisition for the company.
To find out more, I interviewed Hypebeast founder Kevin Ma, as well as Berra and Koston at The Berrics in LA this past weekend about how the deal came together.
“When The Berrics came online in ’07, it was like, “Oh man, what’s is this thing?” They produce such amazing skate videos, constantly, online. Because before maybe it was more so on film or videos or DVDs or whatever they had back then. I think they were one of the first that really just put their videos online. Oh man, how did they produce all of these cool videos at such a constant pace? That was the first time I encountered them,” says Ma. “The branding was amazing, very respected professional skaters behind it as well. So then, we just kept an eye on it. Then I guess, somehow, through different events, through different mutual friends, we got connected at the end.”
Hypebeast was founded in 2005 by Ma, went public on the Hong Kong stock exchange and is now worth millions. It’s a publishing arm that follows the intensely creative and exploding streetwear, sneaker and music scenes, as well as a retail arm in its HBX brand. All of that was built on the back of keeping it authentic and up to the minute, allowing these various voracious subcultures to feel like they had a media home on the web, even as the web itself was coming into existence.
The Berrics may have grown out of a simple desire to give kids a place to skate a set or grind a rail without getting hassled by cops, but out of that it grew to include a massive series of events called Battle at the Berrics, a constant stream of highly watchable videos showing people work their way through tricks at the warehouse and a retail arm in The Berrics Canteen that produces limited edition decks and other merchandise that regularly gets snapped up by collectors.
The videos that The Berrics has been producing for so long now can feel nearly simultaneously highly polished and authentically ad-hoc and show everything from the big contests to daily life at the venue.
If you’re familiar with skating at all you know that back then, the only real chance you got to see skating on video was in compilations put out by skate companies. These were bought on tape, eventually DVD and always traded around in bootleg form. Then came the internet.
“I didn’t know shit about the Internet, except that it was the future,” says Berra about the early days of The Berrics entry into the online video world. “We were sitting in there one day. It was a rainy Saturday. It was Eric, myself, and about 15 other guys. It’s like, man, if a bomb blew up in this place, skateboarding would be done. It was all the best dudes in the world, right?
“I’m from Nebraska. I was like, if I was a kid in Nebraska, I would give my left arm just to be in here.”
So The Berrics began shooting videos and throwing them onto its site, building an audience at the same time as they built the mythos of the company itself.
“Now when they come in, we’re like, “Hey dude. You can skate here as much as you want. Eric and I paid for the building. We pay for all the stuff that needs to get built. All you got to do is film some tricks.” That would be our exchange with them,” says Berra.
The question over time, he says, became how can Koston and Berra use the names they’ve built for themselves skating to build companies and give new pros and wanna be pros a lift. Out of that came the idea to sponsor the building itself. Currently, when you walk into The Berrics through its unassuming front door and down a short hallway you come right into the high-ceilinged park itself. Each section of the walls lining the space is sponsored. Here is a faux 7-11 storefront, there a chunk of wall decorated with the Red Camera logo — a favorite of Berra who is also an accomplished filmmaker.
This relationship with sponsors has kept the physical Berrics running and growing alongside the digital enterprise.
Ma says that Hypebeast can not only help that keep growing, but provide some infrastructure and operational smarts that it has spent years getting right for its own brand.
“For us, we never wanted to come in and change the essence of what the Berrics is about. Again, I’m not a skater. I’m not going to try to be a skater. I will try to learn. It’s just like they know what’s up,” says Ma. “I don’t really know what’s up in the skateboarding world, so we’re not going to go in and try to change things around. We want to keep it as authentic as possible. It’s the same as Hypebeast. If someone came and wanted to change what Hypebeast is about, then it’s like, “Hey, that’s kind of wack. For us, it’s just really trying to support on the back end, or things we learned along the way, we want to share it with everybody. Also, skateboarding should be for everybody. Can we expand this sport of skateboarding, build a really strong, tight-knit, but a bigger community around the world?”
I haven’t skated in 20 years in any serious way, but I’ve never stopped following skating. The culture is fascinating and so is the way that it’s managed to stay authentic over the years despite commercialization. There’s something very real and committed about the way that skaters brave injury to perfect a trick and not just once but over and over and over. That breeds a loyal, engaged audience that will devour content and merch as long as it feels authentic. Berra and Koston bring that authenticity in spades – living legends in a sport that feels too young to have legends. This makes it probably one of the most valuable untapped resources in the skate world.
“There are a lot of skaters that are still part of it, but obviously they’ve grown up and they’ve chosen their path,” says Koston. :They’ve been skateboarders, and they still follow it, and they still follow some kind of the culture. Still, not everybody can skate. Especially with The Berrics, we realized this became a way for them to sort of keep skating, in a way, because that’s kind of all they got. They skate, obviously if they have the spare time, but it’s much more recreational. They’ve grown older. They have families. When they’re in the office, they get time to catch up [on the scene].”
Koston knows this first hand, as he’s been the shepherd of a line of skate shoes for Nike for years now that sells far beyond the bounds of ‘skating proper’. And The Berrics itself produces limited edition decks that sell out every run to collectors, some of which who skate and some of who just love skating, the concept.
From a more mercenary angle, you only have to look at the $1B valuation commanded by skate and streetwear brand Supreme in its $500M Carslyle deal last year to see the potential. The trick now will be maintaining the authenticity and vibe that The Berrics has managed to maintain even as it brought in more sponsorship dollars to keep it running and growing.
“It’s too ubiquitous now to ignore,” says Berra. “Our main goal has always been to grow skateboarding. Because we lived in a time when you made $500 a month skateboarding, and you were the best person in the world at it, you know what I mean? We’re like, “We never want to go back to that time.”
When we see opportunities like this, it’s like, “Is this going to grow skateboarding? Does this help grow skateboarding? Do they share similar values and whatever?” Like Kevin said, you never look at things from a business perspective more than, is that something [we] want to do.”
While the Hypebeast audience may be hungry for more, the deep core of the skating community has always been incredibly allergic to maneuvers it feels are forced or inauthentic. Skating as a culture is a blend of music, art, attitude and a sense of strong community and welcoming people into the world by showing them how people get from nothing to incredible in real-time through video. The trick will be keeping the balance between those forces that Berra and Koston have managed to strike so well over the years while giving it a shot of adrenaline with Hypebeast’s operational skillset.