CNBC TV - HOW I MADE MY MILLIONS - Blendtec

Summary

Blendtec's founder Tom Dickson, known for his 'Will It Blend?' YouTube series, showcases the indestructible nature of his blenders by blending unusual items. His journey from creating a high-speed mill to developing powerful commercial blenders is marked by innovation and overcoming challenges, including patent infringement lawsuits. Despite setbacks, Blendtec's sales skyrocketed after a successful legal battle against Vitamix, with annual revenues reaching $65 million, and the company continues to grow and innovate.

Takeaways

• 🏢 Blendtec's headquarters in Orem, Utah is the site of unusual product testing, including blending iPads and glowsticks.
• 🤔 Tom Dickson, Blendtec's founder, often asks 'Will it blend?', which has become a popular phrase and YouTube series.
• 🔧 Tom Dickson has a history of creating durable and powerful products, starting with a high-speed mill for grinding grain at home.
• 💡 The Total Blender, Blendtec's smash-hit product, was born out of Tom's desire to create an indestructible blender.
• 🎓 Despite being dyslexic and having ADHD, Tom Dickson is recognized as an incredibly smart individual with a knack for mechanics and physics.
• 💡 Tom started his own foundry, California Precision Casting, when no existing foundries could make the parts for his Kitchen Mill.
• 🚀 The Kitchen Mill was a success, with $10 million in sales between 1979 and 1981.
• 📚 Tom faced legal battles, including a patent infringement case and a lawsuit from investors, but he ultimately prevailed.
• 🔄 After being forced out of his first company, Tom moved to Utah and started K Tech, which later became Blendtec.
• 💰 Blendtec's success was boosted by the 'Will it blend?' YouTube videos, which showcased the blender's capabilities and led to increased sales.
• 📉 Legal disputes with Vitamix over patent infringement were resolved in Blendtec's favor, with a $24 million payout in 2012.

Q & A

What is the main product of Blendtec?

Blendtec's main product is the Total Blender, a high-powered blender with microprocessors and pre-programmed cycles designed for both home and commercial use.

Who is the founder of Blendtec and what is his background?

Tom Dickson is the founder of Blendtec. He has a background in creating innovative products, having previously developed a high-speed mill called the Kitchen Mill. He is also dyslexic and has ADHD, which contributed to his unique approach to problem-solving and innovation.

What was the initial inspiration behind the creation of the Blendtec blender?

The initial inspiration for the Blendtec blender came from Tom Dickson's observation that the blender portion of his multi-function home machine was being used in restaurants. This led him to develop a powerful commercial blender.

How did Tom Dickson prove the durability of his blender?

Tom Dickson proved the durability of his blender by conducting actual product tests, blending unusual items such as glowsticks, bic lighters, and even iPads, which became a YouTube sensation.

What was the outcome of the patent infringement case against Vitamix?

In 2010, a federal jury in Utah found Vitamix guilty of patent infringement. Vitamix lost an appeal in 2012 and was ordered to pay Blendtec twenty-four million dollars in damages.

How did Blendtec's marketing strategy evolve with the introduction of their YouTube videos?

The introduction of Blendtec's YouTube videos, created on a $50 marketing budget, showcased the blender's ability to blend unusual items, leading to a significant increase in sales and brand recognition.

What was the initial challenge Tom Dickson faced when trying to develop the blender jar for his multi-function home machine?

The initial challenge was the high cost of developing the precision mold for the sturdy blender jar, which ranged between $80,000 and $112,000. Tom designed a two-part mold for $40,000 to overcome this challenge.

How did Tom Dickson's personal attributes contribute to his success?

Tom Dickson's dyslexia and ADHD, along with his curiosity about mechanisms and speed, contributed to his innovative approach to product development. His ability with gears, physics, and motors allowed him to create indestructible and powerful products.

What was the turning point for Blendtec in terms of commercial success?

The turning point for Blendtec's commercial success was when they developed a higher-powered blender with microprocessors and pre-programmed cycles, which attracted interest from smoothie shops, restaurants, and coffee houses, including big names like Starbucks and Jamba Juice.

How did the legal battle with Vitamix impact Blendtec's business?

The legal battle with Vitamix, which resulted in a victory for Blendtec, stopped Vitamix from making the infringing jar and led to a significant financial settlement. This victory likely bolstered Blendtec's reputation and financial position.

What is Tom Dickson's approach to innovation and improvement?

Tom Dickson's approach to innovation is to always look for ways to improve existing products and to anticipate what others might copy, ensuring that his products remain ahead of the competition.

Outlines

00:00

😲 Invention and Challenges of Blendtec's Total Blender

The script introduces Blendtec's headquarters and its founder Tom Dickson, who is known for his 'Will It Blend?' series on YouTube. Tom's quest for an indestructible blender led to the creation of the Total Blender, a product that gained popularity through videos demonstrating its ability to blend unusual items. The company's success story is rooted in Tom's past, including his dyslexia and ADHD, which he overcame to become an innovative inventor. His first invention was a high-speed kitchen mill that he developed in the 1970s, which led to the establishment of his own foundry when no existing foundry could produce the necessary parts. Despite facing legal battles over patent infringement and being ousted from his own company, Tom persevered and eventually founded Blendtec, creating a powerful commercial blender used by big names like Starbucks and Jamba Juice.

05:03

🚀 Legal Victories and Growth of Blendtec

This paragraph details the ongoing innovation and legal struggles faced by Blendtec. Tom continued to improve his blender's design, introducing the 'Wild Side Jug' with a large blade and a breakthrough in blending technology. The company faced a significant challenge when competitor Vitamix allegedly copied their jar design. After unsuccessful attempts to resolve the issue amicably, Blendtec sued Vitamix for patent infringement in 2006. The launch of Blendtec's YouTube videos, showcasing the blender's capabilities, led to a surge in sales. In 2010, a federal jury found Vitamix guilty, and in 2012, they were ordered to pay Blendtec $24 million in damages. Despite the legal battles, Blendtec's sales grew to around $65 million a year by 2011, with expectations of even higher growth as they re-entered commercial spaces. The paragraph concludes with Tom and Beverly Dickson reflecting on their success and looking forward to their next innovation.

Keywords

💡Blendtec

Blendtec is the company at the center of the video's narrative, known for its high-performance blenders. The company's headquarters in Orem, Utah is depicted as a place of innovation and creativity, where unusual product tests take place. The name Blendtec is synonymous with the theme of the video, which revolves around the company's journey, its founder Tom Dickson's ingenuity, and the development of its 'Total Blender' product.

💡Tom Dickson

Tom Dickson is the founder of Blendtec and the main character in the video's story. He is portrayed as a visionary and inventor who asks the question 'Will it blend?' as part of his product testing. His curiosity and inventiveness are highlighted throughout the video, from his early days of creating a high-speed mill to his development of the Blendtec blenders. Dickson's perseverance and intelligence are key to understanding the company's success.

💡Total Blender

The Total Blender is Blendtec's flagship product, which gained popularity through a series of YouTube videos where unusual items like glowsticks and iPads were blended. These videos showcased the blender's durability and power, turning it into a 'smash-hit' product. The Total Blender is a symbol of Blendtec's commitment to creating indestructible and high-quality kitchen appliances.

💡Product Test

Product testing is a critical aspect of the video, illustrating Tom Dickson's dedication to ensuring his blenders are indestructible. The script mentions his attempts to break the blender using marbles and other objects, which led to the creation of the robust Total Blender. This concept is central to the video's theme, as it demonstrates the company's focus on quality and innovation.

💡Inventiveness

Inventiveness is a key concept in the video, as it describes Tom Dickson's approach to problem-solving and product development. From creating a high-speed mill to designing a powerful blender, Dickson's inventive streak is a driving force behind Blendtec's success. His ability to think outside the box and come up with innovative solutions is a recurring theme throughout the video.

💡Kitchen Mill

The Kitchen Mill is an earlier invention by Tom Dickson, designed to grind grain at home. It replaced traditional grinding stones with stainless steel parts and a vacuum cleaner motor, which was a significant breakthrough at the time. The Kitchen Mill's development and subsequent success in the market (with $10 million in sales from 1979 to 1981) set the stage for Blendtec's future innovations.

💡Patent Infringement

Patent infringement is a significant issue in the video, as it highlights the challenges Tom Dickson faced in protecting his intellectual property. The script mentions a lawsuit from investors and later, a legal battle with Vitamix over the copying of the blender jar design. These events underscore the importance of patents in safeguarding innovation and the company's legal battles to protect its technology.

💡Commercial Blender

The commercial blender is a higher-powered version of the Total Blender designed for use in smoothie shops, restaurants, and coffee houses. It features microprocessors and pre-programmed cycles, making it suitable for both home and commercial use. The commercial blender's development marks a strategic shift for Blendtec, expanding its market reach beyond home appliances.

💡YouTube Videos

The YouTube videos are a pivotal moment in the video's narrative, as they showcase the Total Blender's capabilities by blending unusual items. These videos, created on a $50 marketing budget, went viral and significantly boosted Blendtec's sales. They exemplify the power of social media and creative marketing in promoting a product and building a brand's reputation.

💡Legal Battle

The legal battle with Vitamix over patent infringement is a key event in the video, demonstrating the lengths Blendtec went to protect its intellectual property. The script details the lawsuit, the federal court's ruling in Blendtec's favor, and the eventual settlement where Vitamix was ordered to pay Blendtec $24 million in damages. This legal victory is a testament to the importance of protecting one's inventions and innovations.

💡Innovation

Innovation is a central theme in the video, as it encapsulates Tom Dickson's approach to product development and the company's ethos. From the Kitchen Mill to the Total Blender and the commercial blender, the video showcases a series of innovative products that revolutionized the home appliance industry. The script highlights Dickson's continuous pursuit of improvement and his mindset of always looking for ways to make things better.

Highlights

Tom Dickson, founder of Blendtec, is known for blending unusual items like glowsticks and iPads to test the durability of his blenders.

Blendtec's Total Blender gained popularity through videos on YouTube, showcasing its ability to blend tough materials.

Tom Dickson's innovative approach to creating an 'indestructible blender' involved rigorous product testing with unconventional materials.

Despite being dyslexic and having ADHD, Tom Dickson has demonstrated exceptional intelligence and creativity in mechanics and engineering.

Tom's early interest in speed and mechanisms led him to put 'big engines on little things', such as go-karts and motorcycles.

In the mid-1970s, Tom developed a high-speed mill for grinding grain at home, using a vacuum cleaner motor and stainless steel parts.

Tom's Kitchen Mill invention attracted $350,000 in investment but faced challenges with manufacturing due to the complexity of the parts.

To overcome manufacturing hurdles, Tom started his own foundry, California Precision Casting, in the San Francisco Bay area.

The Kitchen Mill was patented and launched in 1979, achieving $10 million in sales within the first two years.

Tom faced legal battles with investors who sued him for patent infringement and attempted to take control of the patent.

An attorney who became the majority shareholder in Tom's company eventually fired him and took control.

After moving to Utah, Tom founded K Tech and developed a multi-function kitchen machine, including a blender with a unique jar design.

Tom's innovative blender jar design reduced manufacturing costs and was made in America.

Blendtec's commercial blenders were adopted by smoothie shops and restaurants like Starbucks and Jamba Juice.

Blendtec's 'Will It Blend?' videos on YouTube demonstrated the blender's capabilities and boosted sales significantly.

A legal battle with Vitamix over patent infringement led to a $24 million payout for Blendtec in 2012.

Despite the challenges, Blendtec's sales grew to around $65 million a year by 2011, with expectations of further growth.

Tom Dickson continues to innovate and is always looking for ways to improve his products and stay ahead of competitors.

Transcripts

the sleek exterior of Blendtec's

headquarters in Orem Utah offers no hint

of the truly odd stuff that takes place

inside when company founder Tom Dickson

asks will it blend that is the question

glowsticks bic lighter even ipads get

tossed into the company's smash-hit

product the total blender the videos a

youtube sensation were born out of Tom's

actual product test as I'd take two by

twos and marbles and and I try to break

the blender because we want an

indestructible blender and he built one

Tom himself has proved pretty

indestructible as well creating Blendtec

from the rubble of his kitchen mill

business and surviving a potentially

crippling patent infringement case

executive vice-president Richard

Galbreath who's known Dickson since

middles says tom has a long history of

coming from behind you know you had the

kids who were the high fliers

academically Tom was never in that crew

I'm Dyslexic and I'm ADHD so I spent a

lot of time in the corner but I'll tell

you over the last 50 years he is perhaps

one of the smartest people I've ever

known he has an incredible ability with

gears and physics and motors and making

things work

his blenders with their three horsepower

motors are just the latest creation from

a guy who was seemingly born curious

about mechanisms and speed I've always

put big engines on little things from

the go-karts to motorcycles and always

had to go fast in the mid-1970s Tom who

also enjoyed making his own bread from

scratch put his inventive streak to work

developing a high speed mill to grind

grain at home replacing the grinding

stones with fine toothed stainless steel

parts and a better power source I

thought you know I could use a vacuum

cleaner motor to make flour that would

be a major breakthrough eventually he

found investors to pour about three

hundred and fifty thousand dollars into

his invention but there was a problem no

investment casting boundary in the world

could make the part solution do it

himself so he started his own foundry

called California precision casting in

the San Francisco Bay so this is a rotor

and the stator and most parts go

together they don't touch he patented

the technology in his product called the

kitchen mill and introduced it in 1979

sales took off 79 to 81 we had done 10

million in sales still tom says some of

his investors claimed the product just

wasn't up to snuff and that's not all

they sued my wife and I for eight

hundred thousand dollars to try to get

the patent away from he says that suit

was eventually dropped but later he

found several companies using his

technology in their own Mills so he sued

for patent infringement federal court

judge ruled validity of my patent and

literal infringement they tried to make

life absolutely miserable for him

financially but Tom had the patent tom

says he was also blindsided by an

attorney who bought into his company and

eventually became the majority

shareholder so one day announced to me

that he was taking control of the

company and I better behave myself or

I'd be out on the street and so he fired

me

kicked out of his first company Tom

moved his family to Utah so I figured

okay we have the best Mel in the world

I've got the patent on it let's make

Mills and let's come up with a

multi-function kitchen machine to

compete with Bosch and Germany and of

course the KitchenAid trouble was Dixon

and his newly founded Company K Tech

didn't have the capital to develop the

precision mold for the sturdy blender

jar that was key to the product he

envisioned those jars are are costing

between 80,000 and 112 thousand dollars

to make a mold so I designed a blender

jar that the handle just come straight

down and so I can just do a two-part

mold for $40,000 made in America that

comes apart and you just pull the jar

off the core of that mold soon he

discovered the blender portion of his

multi-function home machine was being

used in restaurants so I thought oh you

think that's cool

I can build a really powerful commercial

blender it was the beginning of Blendtec

this time Tom developed an even higher

powered blender with micro processors

and pre-programmed cycles for home and

commercial use smoothie shops

restaurants and coffee houses were eager

to try the total blender in the 1990s

big names like Starbucks - a relative

newcomer called Jamba Juice but they

said we don't have any money and I said

look just give me a nickel every time

you do a blend they got up to 336 stores

and they're doing 50 million smoothies a

year even at $1,000 apiece commercially

the blenders became a hot item still Tom

continued to tinker with its design we

developed a jar call the wild side jug

and this jar has a huge blade it's four

inches in diameter and but most

importantly it has a wild side and this

was the breakthrough in blending

technology business was booming and

production in full swing when Tom got

some devastating news some of our

accounts are saying well Vitamix has a

jar that's very similar they copied

Jarre and this is their copy of the jar

it's exactly it nests in in our jar and

they both have single blades with

winglets Tom's wife Beverly says

initially he wasn't looking to sue top

competitor and industry Titan vitamins

they weren't responding to requests to

abandon the infringement when those

requests were not being met then I think

he felt like he had no choice they were

going into our very best accounts and

stealing those accounts away from us

with our own technology in February 2006

Glenn tech sued Vitamix for patent

infringement in October of that same

year the Blendtec videos created on a

$50 marketing budget hit YouTube

our sales went crazy people think if

this blender can destroy all of this

stuff this can do anything with food

orders for Blendtec's $400 home machine

rapidly rose even as commercial accounts

slid because of the copied blender jars

then in 2010 a federal jury in Utah

found Vitamix guilty of patent

infringement and then stopped Vitamix

from making the infringing jar that's

when things changed Vitamix lost an

appeal in 2012 and has been ordered to

pay Blendtec twenty four million dollars

in damages despite the legal battles in

2011 Blendtec sales had built to around

65 million dollars a year our growth

each year is in the tens of millions of

dollars and they expect even higher

growth since they're back in more

commercial spaces like planet smoothie

now Tom and Beverly have some time to

stop and savor their own smoothies

always sneak the vitamins in while he

begins work on his next big idea his

mind is always always looking at how

something can be done better

now who's going to copy this

you