The Cost of Doing What You Love

I've spent my entire career building a lifestyle business: a canoe-building shop in Hawai'i. My friends and I grew up in Hawai'i, paddled a lot, and canoes were expensive. It seemed like a great way to build a life involving something we all loved. When we started, I ran a canoe paddling website, and my friends competed at a high level. We got a warehouse and old molds and were off to the races. We were young and full of dreams. The year was 2007.

It worked for a while. We grew fast, hitting $1,000,000 annual gross in year two. We had the most popular canoe on the market within a few years. Seventy percent of canoes at races were ours. People would hoot on the starting line because our Pueo model was a Hawaiian owl. It was golden.

We pushed from one canoe a week to two, four, five, and, for a time, seven canoes per week. We doubled our space from 2400 square feet to 4800. We hired our peers, young paddlers, and some older ones too. We worked 50+ hours in the shop, went to bed itchy every night (carbon fiber and fiberglass!), and paddled our hearts out.

On the outside, we looked like a fantastic success—twenty-four-year-olds with a thriving seven-figure business. I remember one customer asking what I do with my money and being surprised at my '97 Saab. He asked if I had bought Tesla stock yet. The year was 2010, wise advice in hindsight. Our reality was a $1200 monthly draw, $800 for rent, and $400 for everything else. The Saab was my first car, purchased the year before for $1300, two years into business at age 24.

At some level, I always knew this would be hard. But had I known how entirely financially unsustainable manufacturing canoes in Hawai'i would be, I never would have started.

Outsourcing would have been the logical way to scale, but I like building and never wanted to manage quality overseas. Building locally has always been a source of pride, and I wanted a fantasy factory to tinker for all my years. With the culture of canoes rooted in Hawai'i, keeping them Made in Hawai'i always seemed important.

We had some big wins. We kicked off an unlimited class of six-man canoes, and our team won all the races. Our second single-person canoe got $60,000 of deposits within forty-eight hours of launch -- not bad for a new and untested chunk of carbon fiber. We got our first CNC machine in 2014. Progress happened, but for the most part, we coasted. Partners left, and people grew up, moving on to the fire department or corporate engineering jobs. It was all hard for a business that had little to no margin. It took five years to pay for that CNC machine. By the time 2019 rolled around, our only competitors had consolidated to China-based manufacturing. The design-performance gap closed, and overseas manufacturing became excellent. Our sales dwindled for the first time, and the end of our business was in sight.

When covid lockdowns came, I laid off our entire crew. For four days, it felt like the end. Then, I made a face shield with some canoe materials. By year's end, our little canoe company had made 900,000 face shields. It was a whirlwind experience. I got my first taste of scale. In eight weeks, I made a factory that could turn out a face shield every 3.5 seconds, 24/7. Sixty thousand times faster than we could make a canoe.

The project added $3.5M to our revenue and ended with $1.5M in liquid capital. It was an intense but fun three and a half months.

Cashing those checks was a numbing experience. I felt relief and pride. And then confusion soon after. The "now what" question weighed on me. $1M+ is a lot of money. Not sit on a beach money, but enough to contemplate the rest of my life. I wanted this canoe business to exist. It was my life's work, mostly enjoyable, and it brought me all the things one could want from a career -- respect, happy customers, and creative satisfaction. The one problem was that my income was closer to a sandwich artist than an engineer, let alone a CEO.

But with new confidence and new capital, I decided I could fix that. Double production, then, the numbers would work out better; I could compensate fairly and build canoes forever. So overnight, my fourteen-year-old small business turned into a startup: high burn, buying a $300,000 machine, building a new shop, and launching a new canoe.

It all worked until it didn't. Having a burn rate is miserable. It was the most stressful time of my life. My daughter was born. We borrowed a lot more money from the SBA. The burn continued. We launched the canoe. We raised prices. By then, our bank account had gone from 1.8 million to under 50k in eighteen months—two weeks of runway.

But it seemed like everything could still come together. And then my relationship failed in a catastrophic fireball. Like my bank account, in one moment, I was on top of the world with a budding family, and in the next, I was living alone and co-parenting my 10-month-old daughter.

And my business was still failing. We hustled for a while. The new canoe sold well. But sales didn't increase. I didn't anticipate the other end of the COVID bubble. Canoes, like many recreational items, boomed and then went bust. In January of 2024, things were fully broken: we couldn't pay rent. We sold a couple of machines and finally downsized.

Today, we scrape by, building 2-3 canoes per week with a tiny crew—about half of what we've always done. In the haze of spending all that money and shattered dreams of family life, I lost faith that I could make a living and comfortably raise my daughter. But I know if we shut down -- I'll never rebuild it. So I keep going.

My daughter has given me purpose in all of this. A little one keeps you grounded. I'd have run away from it all had I not had her. The other thing she's changed for me is more time at home than I've had in 15 years. So, I've returned to the one thing I did before canoes: programming.

I've found solace and motivation by quietly writing lines of code. I build canoes for 40 hours a week. Hang out with my kid. And code 3 hours a night. As far as my daughter is concerned, she thinks I make apps and canoes. I hope she's correct.

And if I'm lucky, it'll scale like face shields, not canoes.

Thanks for reading my story. My app is called Grug Notes. It's like a blue-collar version of Notion and my AI multi-tool. I note funny things my daughter says, create supply order lists, and make hypothetical paddling training plans I dream about doing one day.

Kamanu Composites continues. Our Noio canoe continues to win races and win over customers. Slowly, word-of-mouth marketing keeps us afloat. We operate week to week and try not to die.

Keizo Gates Say hi: [email protected]