OXX Looks to MGCS Investors to Keep its Rugged Appliance Products Perking
OXX is serving up a novel appliance product line that it hopes will whet the appetite of investors at the Michigan Growth Capital Symposium in May.
“Our mission is to be a rugged-appliance company with products spanning six broad categories,” says Kent Brown, who is chief executive of the Grand Rapids, Michigan-based startup.
The first OXX product, introduced three years ago, is the Coffeeboxx™. The ultra-rugged portable coffeemaker plugs into an electric outlet or a power generator and is built to withstand the hard knocks and heavy use doled out by workers on a job site.
“Our founder, Jim Doan, was an appliance designer for Whirlpool Corporation,” Brown explains. “In doing his research, he noticed that guys were bringing kitchen coffeemakers and small appliances to job sites. These appliances didn’t work very well or last very long.”
The job-site challenge piqued Doan’s curiosity and creativity.
“Jim had a must-be-a-better-way moment,” Brown says. “In his spare time, he designed the Coffeeboxx™ to survive outdoors, where it might get knocked off the back of a truck or covered in sawdust. Jim wanted to give guys good, hot, fresh coffee all day.”
Eventually, Doan left his job at Whirlpool in Benton Harbor and launched OXX in 2014. Brown, who has racked up 27 years of sales and marketing experience in the consumer hard goods industry, joined OXX as CEO in April 2017.
Brown is the first to admit that coffeemakers are a dime a dozen. However, he insists, OXX has carved out a niche market that is not being served by larger competitors.
“This is really a new market and somewhat specialized,” Brown remarks. “Big appliance manufacturers are really not focused on it. They’re more concerned about how to make something cheaper for Walmart or something for your beautiful kitchen. Job sites just don’t interest them.”
Although the U.S. market for OXX’s rugged appliances is difficult to quantify, the startup has found its products also resonate with first-responders, fire fighters, police and the military, as well as outdoor enthusiasts, hunters, campers, boaters and tailgaters. OXX’s lifetime revenue since it started selling the Coffeeboxx™ in 2015 is $2.5 million.
The cost of developing and manufacturing new appliances is considerable, so OXX is keying in on investors at the MGCS who may be interested in participating in a $5.5 million Series B round of funding. The money would be used to fund the development of the next four appliances, including the “world’s toughest microwave,” which will hit the market in early 2019.
The startup already has raised several million dollars from a combination of angel and venture capital investors, private individuals and a private equity group.
“We’re looking to find some new partners in the business who are going to help us grow together,” Brown says. “It’s a good fit for anyone who is looking for, or has experience with, investing in physical products. They need to understand the lead time and development costs of what we do as well as the consumer markets, in terms of selling direct or through retail partners.”
Remaining a Michigan-based company with Michigan-based investors is paramount for OXX.
“Our current investors are pretty much all from Michigan, and primarily West Michigan,” Brown notes. “Some of them are just as interested in growing the Grand Rapids economy, hiring more people and making OXX a thriving Michigan business, as part of becoming a broader, bigger company. Being able to build the Michigan economy is an important part of what we do.”
