The Rise of the Dyrdek Machine

 

For the last couple of years, former professional skateboarder Rob Dyrdek has been hard at work on his company Dyrdek Machine. What is Dyrdek Machine? According to the company's website, "Dyrdek Machine is a venture creation studio that manufactures amazing companies by systematically fusing art, science, and magic. We provide expertise, capital, and amplification to visionary entrepreneurs destined to impact the world. We guide Do-Or-Diers through the Machine Method; chronicle the journey together on Build With Rob, and pay it forward through the Do-Or-Dier Visionary Foundation. Since launching in 2016, Dyrdek Machine has created 18 brands — 6 have exited for a combined $550M."¹ In simpler terms, the company is combining different aspects of life to create innovative avenues for products to reach consumers. One way they do this is by using what Rob and his team call the Machine Method. The Machine Method is split into five key phases(Discovery, Diligence, Build, Launch, and Scale). Another question that needs to be answered is: What are these five key phases and how do they lead to company-creating success?

Let's start with the first two phases. What is the Discovery Method? According to the website, this phase is best described as "an assessment process to determine if there is a desire to dedicate resources to weighing the viability of a potential opportunity. Once we determine the idea fits this basic criteria we then do a Machine Principle Assessment to determine if the opportunity is the right fit for the Dyrdek Machine."² This phase is a fancy way of using a focus group to test products. The next phase which is Diligence is described as "the initial development of the opportunity as well as the validation period before partnership. This is not only a time to develop the beta of the overall business, but also a time to seek out as much knowledge and expertise to help validate the assumptions of concept, market, and opportunity. At the end of this phase, we will decide to commit the capital and create the company based on an investment hypothesis."³ This is where things get interesting because every idea needs a foundation to base that idea of. Without this phase, the rest of the business plan is null and void. The business is like the scientific method, things need to be done in order. 

Phase 3: Build is where everything starts to come together. That phase is where the team " will focus on defining and developing the core to more consumers, then creating the initial product, and brand concepts for testing using our Machine Core Elements. Then the product and brand along with a refined investment hypothesis will be presented to potential capital partners and prepared to go to market."⁴ The market is important because that is when the consumer comes in. Once products get into the hands of consumers, then the companies behind said products can get a return in profit which is very key. Phase four: Launch is just as important as not only the third phase but the other two phases as well. In Phase Four "Even with the most thorough, strategic plans, taking a product to market and growing a business requires an immense amount of energy and determination. Once the product is in the market and the company has been operationalized it is non-stop customer development and hypothesis testing until the company has found product-market fit and a clear business model."⁵ As previously stated, the market is where things become make or break. Products start reaching customers during this launch period and the final phase can not happen until phase four sees a positive outcome.

The final phase: Scale is key. In phase five "the Scale phase will optimize systems and processes now that a clear business model has been developed and the company is ready for accelerated growth. Amplifying all aspects of the company taking the product from the core consumer to the more consumer and expanding the product line and distribution channels. Based on the initial exit strategy developed as part of the investment hypothesis the business will seek to be acquired or create a liquidity event."⁶ In business, scale is very important. Without scale, you can not see how your product does over time, thus your return of profit does not matter. The business model is just as important as what is in it.

What makes Dyrdek Machine in my opinion so successful is that they have a clear-cut strategy for handling every aspect a business needs to be successful. Every business should follow a model like this because then your consumer level can increase tenfold. You look at the type of products that Dyrdek Machine is releasing to consumers they are hitting every market that consumers need from clothing to food and more. Business is forever changing and the consumer will always gravitate to a company that knows how to change their product accordingly. That is the essence of Dyrdek Machine.