WEBVTT - Rhone CEO on Creating Strong Customer Experience

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<v Speaker 1>This is Bloomberg Business Week with Carol Messer and Jason

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<v Speaker 1>Kelly on Bloomberg Radio. All right, you're gonna round out

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<v Speaker 1>the week catching up with an old friend, Nate check

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<v Speaker 1>It's co founder and CEO of Rome, based up in Stanford, Connecticut,

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<v Speaker 1>here in our Bloomberg Interactive Broker Studio. Great to see you.

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<v Speaker 1>It's great seeing you. It's been too long. Uh. What's

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<v Speaker 1>funny speaking of Stanford is one of the reasons that

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<v Speaker 1>you and I got in touch was I was up

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<v Speaker 1>at Chelsea Pierre's Stamford edition with one of my sons.

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<v Speaker 1>He was playing lacrosse. I was wandering around Chelsea Piers

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<v Speaker 1>and you don't have to wander far before you see

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<v Speaker 1>a roan. Looks like a pop up, but I mean

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<v Speaker 1>it's there. It's a almost three year pop up at

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<v Speaker 1>this point. We we took office space at Chelsea Pierre

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<v Speaker 1>Stanford three years ago and we said, you know, what

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<v Speaker 1>would be great would be to put a store here,

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<v Speaker 1>and they were great, and it's just it's done so

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<v Speaker 1>incredib doubly well. It's really the first store we ever opened,

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<v Speaker 1>and we just keep it going as long as we

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<v Speaker 1>possibly can. Well, internally, I think you're familiar with the

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<v Speaker 1>Chelsea Pierce here in New York City. I mean, this

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<v Speaker 1>is a massive complex. You've got so many people going through,

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<v Speaker 1>and let's be honest, it's your demo. Yeah. Well parents,

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<v Speaker 1>parents are going through all the time, and everybody's there

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<v Speaker 1>to work out there athletically minded, so it's perfect for us. Sorry,

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<v Speaker 1>how big is the company now? You've taken funding the

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<v Speaker 1>last couple of years, your private equity backed. Uh, if

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<v Speaker 1>we were just talking about the athletic apparel, it's definitely

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<v Speaker 1>a hot market now. Um, we've had incredible growth really

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<v Speaker 1>over the last eighteen months. In particular, the company's ground

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<v Speaker 1>leaps and bounds and we've grown triple digits every single

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<v Speaker 1>year since inception. Um, we added four retail stores. Uh,

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<v Speaker 1>you know, we've We've been told that our Hudson Yards

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<v Speaker 1>store is the second highest sales per square foot retailer there. Yeah,

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<v Speaker 1>and I'm sure they do well. But in the apparel world,

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<v Speaker 1>you know, we've done really really well there and so um,

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<v Speaker 1>the growth has been phenomenal, but it's been driven primarily

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<v Speaker 1>by our direct business, you know, through our website, round

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<v Speaker 1>dot com and then through our retail stores. So let's

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<v Speaker 1>talk about the direct to consumer business because I think

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<v Speaker 1>if we think back to the key themes, certainly of

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<v Speaker 1>twenty nine and I'm guessing going into it's that sort

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<v Speaker 1>of like D two se blended with a bit of

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<v Speaker 1>retail omni channel look at things. What have you learned

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<v Speaker 1>about the consumer, especially through uh that direct to consumer channel? Well,

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<v Speaker 1>there's I mean, there's so much to unpack there, but

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<v Speaker 1>I think the main thing is that businesses that are

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<v Speaker 1>having a ton of success right now, it's not necessarily

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<v Speaker 1>the direct to consumer model, although it's a huge part

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<v Speaker 1>of it. It's the digitally native part that I think

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<v Speaker 1>is driving a lot of it. The primary transaction is

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<v Speaker 1>moving online. You know, you're seeing it every single Black Friday,

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<v Speaker 1>Cyber Monday. Retail matters for sure, and it's not completely irrelevant.

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<v Speaker 1>But brands that have a great direct relationship with their customer,

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<v Speaker 1>which is handled over digital channels, work really really well

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<v Speaker 1>in this environment, and it can be complimented with a

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<v Speaker 1>wholesale relationship and appearing in the right places. You know,

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<v Speaker 1>we're the number one men's brand for Equinox. Now we're

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<v Speaker 1>the number one men's brand with Peloton and um and

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<v Speaker 1>those things. Have mattered for us, but you can't rely

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<v Speaker 1>on that to be your soul business ever. Considering and

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<v Speaker 1>opening a women's line. We we get that question a

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<v Speaker 1>lot um. We you know, we're hyper focused on what

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<v Speaker 1>we're doing right now, and we think that we can

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<v Speaker 1>be kind of a unique voice in the market. There

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<v Speaker 1>are a tremendous amount of women's brands out there. We

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<v Speaker 1>if we go into it, we'd only go into it

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<v Speaker 1>if we thought we could be the appsolute best in

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<v Speaker 1>the category. You've been at this for about five years now.

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<v Speaker 1>What's been the biggest surprise so far? I think, gosh,

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<v Speaker 1>I mean, I think the biggest surprise is just that

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<v Speaker 1>I still love more than anything, I really love the

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<v Speaker 1>product piece. And we are a product driven business, and

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<v Speaker 1>you know, you hear about these bigger consumer companies that

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<v Speaker 1>start to I know, we're a technology company, and yeah

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<v Speaker 1>we do, we have a we have a head of

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<v Speaker 1>data and analytics now, but we are a product company

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<v Speaker 1>and we love making the best in class products. And

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<v Speaker 1>so what have you learned about the product in terms

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<v Speaker 1>of like what people want? What's really resonated? Because I know,

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<v Speaker 1>like I wear some of like your commuter pant, you know,

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<v Speaker 1>That's exactly what I was gonna talk about. So we started,

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<v Speaker 1>you know, hyper focused on active what you can wear

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<v Speaker 1>to the gym, what you can wear to run in,

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<v Speaker 1>and the line is evolved. We launched a dress shirt

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<v Speaker 1>this year on the floor of the New York Stock Exchange.

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<v Speaker 1>We cannot keep the shirt and stock we so we

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<v Speaker 1>we put it up first day of our Black Friday sale.

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<v Speaker 1>We started breaking on sizes in the first day. The

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<v Speaker 1>biggest complaint we had is you can't buy this dress

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<v Speaker 1>shirt anywhere, and um, we didn't have enough stock to

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<v Speaker 1>give to any of our wholesalers, so they were upset.

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<v Speaker 1>So um, I think I think the biggest shock is

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<v Speaker 1>that our consumer is trusting us to make a button

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<v Speaker 1>down dress shirt, which five years ago I never would

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<v Speaker 1>have thought we would be in that business out to

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<v Speaker 1>replace the trader rest. We do make some really incredible

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<v Speaker 1>vest yes, And so what have you learned about the

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<v Speaker 1>consumer of late? Because I mean, what you're talking what's

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<v Speaker 1>underneath a lot of what you're talking about, And I

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<v Speaker 1>think what Shannale is alluding to as well, is this

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<v Speaker 1>is this notion that fashion has changed. It's changed on

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<v Speaker 1>Wall Street, it's changed in the professional landscape as well.

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<v Speaker 1>Where where are we and where are we moving to?

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<v Speaker 1>And that's it's a great question. So I mean, if

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<v Speaker 1>you go back ten fifteen years in the guy's closet,

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<v Speaker 1>the way that men think is it would all be segmented,

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<v Speaker 1>bucketed by activity. This is what I can wear to

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<v Speaker 1>the gym, This is what I can wear to work,

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<v Speaker 1>This is what I can wear to travel, this is

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<v Speaker 1>what I can wear at home to what I can

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<v Speaker 1>wear to hang out with friends. So many of those

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<v Speaker 1>categories exclude formal for a second. So many of those

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<v Speaker 1>categories have collapsed into a single category. Now we call

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<v Speaker 1>that category performance lifestyle. We were really one of the

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<v Speaker 1>first in the industry to ever use that term. A

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<v Speaker 1>lot of people use ath leisure, but I think that's

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<v Speaker 1>a misnomer for what this is. This is an athletic

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<v Speaker 1>clothing that's meant to you know that you can wear

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<v Speaker 1>anywhere else. This is traditional lifestyle silhouettes made with unbelievable

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<v Speaker 1>performance fabrics. So if you wanted to run a marathon

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<v Speaker 1>in our commuter pants and people have you could if

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<v Speaker 1>you wanted to. Are are the way we developed our

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<v Speaker 1>dress shirt is our chief product officer took it in

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<v Speaker 1>the mountains of Croatia and ran thirteen miles in it.

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<v Speaker 1>So it's performance based fabrics and clothing that can live

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<v Speaker 1>with you. But we're making them in some of the

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<v Speaker 1>silhouettes that are kind of the most popular and that

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<v Speaker 1>guys feel comfortable. So you're an entrepreneur, right, and but

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<v Speaker 1>you started this company with a full time job. Still

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<v Speaker 1>didn't Yeah, I did, that's true. At what point did

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<v Speaker 1>you decide to break out on your own? I feel

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<v Speaker 1>like everybody who's listening is sitting there in a full

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<v Speaker 1>time chaveliche. Well, I also had two kids, which was

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<v Speaker 1>the which was the bigger challenge, and I had had

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<v Speaker 1>a startup that I had done before that did not

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<v Speaker 1>go so well. So the biggest challenge was convincing my

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<v Speaker 1>wife to you know, support me and get behind it again.

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<v Speaker 1>But you know, I think part of the challenge of

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<v Speaker 1>being an entrepreneur the pros or you know, you're you

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<v Speaker 1>have all these opportunity the concert you can't turn that

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<v Speaker 1>voice off inside your head. There's a better way, there's

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<v Speaker 1>some there's a way of solving this problem. And for me,

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<v Speaker 1>it didn't feel like a choice. I knew I had

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<v Speaker 1>to get back to doing something entrepreneurial. Biggest goal for

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<v Speaker 1>what are you looking ahead too? We are planning on

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<v Speaker 1>doubling the business again, so we've got big aggressive goals.

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<v Speaker 1>It gets harder as the business gets bigger to do that.

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<v Speaker 1>But um, the team's really excited and lined around it.

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<v Speaker 1>And is that new lines, new products or it's drivention?

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<v Speaker 1>What is it? It's driven primarily by a couple of things. Actually,

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<v Speaker 1>in some ways it will be a more focused and

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<v Speaker 1>assortment around the things that we know are working really

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<v Speaker 1>really well. Um, But it's also about leaning into retail

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<v Speaker 1>a little bit more aggressively and then harnessing the power

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<v Speaker 1>of data to better understand our consumer and find more

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<v Speaker 1>consumers like them. All right, Nate Check, It's always good

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<v Speaker 1>to catch up with you. Co founder CEO of Rome

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<v Speaker 1>based up in Stanford, Connecticut. Check them out online at

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<v Speaker 1>road dot com, or check them out if you're up

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<v Speaker 1>at Chelsea Pierce like I was, or at Hudson Yards