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The Business of Watches [028] Studio Underd0g Founder Richard Benc

Published on Wed, 3 Jun 2026 15:00:00 +0000

Launched just five years ago, Studio Underd0g is now one of the bigger watch brands in the U.K., with about 30 staff and a full assembly and after-market facility. Up next... The D0ghouse.

Synopsis

This episode of The Business of Watches features Richard Bence, founder of Studio Underdog, a rapidly growing UK-based independent watch brand. Bence discusses the company's remarkable growth from 250 watches in its first year (2021) to 14,600 pieces in 2024, generating approximately £9 million in revenue. The conversation covers Studio Underdog's unique approach to watchmaking, including assembling all watches in the UK despite infrastructure challenges, and Bence's recent acquisition of Horologium, the assembly facility that had been producing the brand's watches.

Bence shares insights into the brand's direct-to-consumer model, which accounts for 96-97% of sales, with the US market representing over 40% of revenue. He discusses navigating challenges including US tariffs, maintaining accessible pricing (from £550 to £1,750 for core models), and managing growth from a one-man operation to a team of 26-30 employees. The episode also explores Studio Underdog's collaboration strategy, including high-profile partnerships with H. Moser & Cie, and the upcoming opening of "The Doghouse," a physical showroom and assembly experience center in Brighton. Bence emphasizes his philosophy of making "serious watches for serious collectors that don't take themselves too seriously," balancing playful design with credible watchmaking while maintaining profitability without external investors.

Transcript

Speaker
Host/Interviewer Welcome to the Business of Watches, the Hodicky Podcast, where horology meets high finance and we go behind the scenes with the executives driving the industry. This week, one of the UK's biggest watchmakers and a brand that We talk with Richard Bence, the founder of Studio Underdog. We discuss the rapid growth of the irreverent brand and how he's managing getting bigger while staying true to the company's roots. But first, let's catch up with some business news making headlines in the watch world. Secondary market prices are rising. After years of declines, prices on the secondary watch market are stabilizing and posted gains of more than 1% for three consecutive quarters, according to an analyst report from Morgan Stanley and Watch Charts. An index of pre-owned watches compiled by Watch Charts rose 1.9% in the first three months of the year from the previous quarter, led by gains from a wide swath of brands, including Longines, Petecphilipe, and Zenith, the data shows. It's the first time since 2022 that prices have climbed significantly for an extended period. The results suggests a broad recovery in secondary market values, driven by rising prices on the primary market, tariffs on watches entering the U.S., and increased confidence and interest in the market for pre-owned premium watches. The gains were broad based, with 25 out of 35 brands tracks showing gains during the period from January to March. And another Cartier record price tag. Christie's snatched the title of selling the most expensive Kartier wristwatch at auction with a rare 18-karat gold Kartier London crash from 1990 that fetched about $2 million doll atars Christie's Geneva Important Watches sale in May. The watch beat out the previous record holder, another Cartier crash, this one from nineteen eighty seven that sold for one point nine nine million through Sotheby's in Hong Kong just a few weeks before. The cartier crash wristwatches that were made before 1991 are extremely special and the market has changed. And in other auction news, Apotec Philippe First Series 2499 in pink gold sold for about ten point two five million dollars in Hong Kong last weekend. At that price, it's the most valuable timepiece ever sold at auction in Asia, and the most expensive watch sold at auction this year, and it sets a new record for the $24.99 reference. Auction prices have been soaring so far this year with record results for the big three Phillips, Christie's and Sotheby's to start the year. For more on these stories and more business news, head on over to hodinky.com. And now here's our conversation with Richard Bence, the founder of Studio Underdog. Well, Richard Bence, the founder of Studio Underdog. Welcome to the business of watches. Where do we find you this morning? We are speaking remotely. You are in Brighton.
Richard Bence I'm in Brighton. Yeah. I've uh uh I've got
Host/Interviewer you up nice and early this morning to uh to to get this uh this conversation done first thing so the sun's uh sun's out it's uh yeah we've had a bit of a heat wave in in the UK over the last week or so um so I'm enjoying it. Excellent. So let's talk about Studio Underdog, which is your brand and an independent brand, a UK based brand. Where are you at now in terms of production? How big is Studio Underdog? You're actually among the biggest UK-based watchmakers.
Richard Bence This really is the business of watches, isn't it? Straight in with the uh with the numbers. No, we're we're we're relatively public. I know I know some of the the brands you speak to often will kind of give ranges, but we're fairly transparent. So in terms of our output, last year we did, I believe, 14,600 watches, and we're a British brand and we've decided that it would be a good idea to assemble all of these watches here in the UK, which is easier said than done. It's an industry that that doesn't really exist. The infrastructure isn't really there. So it's something that we've had to slowly build out ourselves. And even though we're we're young brands, five years old, it still feels relatively slow.
Host/Interviewer Absolutely. And we'll talk about that and sort of the you, know some, of the business moves that you've made in terms of, you know, fostering that assembly and that whole infrastructure in the UK. But let's talk about I mean you're a relatively young brand, as you say. You started in 2020. I mean, what is the the history of studio underdog? I mean, we all kind of know it as watch enthusiasts. It's been around for a while, but I mean this was something that you basically that you started, I think during COVID, you know, that that's not uh that unusual a story. But I mean, you know, tell me what you were doing before and and how Studio Underdog sort of came about.
Richard Bence Sure. So my my backgrounds' uh in industrial design. That's what I studied, that's what I absolutely love. I didn't really know the watch industry existed until my early 20s. Um but when I discovered it, it felt like a bit of uh a match made in heaven because my approach to design, I always found myself gravitating towards designing small objects because then the devil's in the detail. So
Host/Interviewer I worked in the industry for a few years,
Richard Bence about six years designing watches for some other brands, mostly fashion brands.
Host/Interviewer Okay. The first watch I designed
Richard Bence was uh a minions watch, a watch uh for for children. Um so humble beginnings for sure.
Host/Interviewer Right. But I got a few years of experience
Richard Bence under my belt. Uh and then COVID happened. COVID came and I was stuck at home trying to figure out w what I wanted to do. And I decided to to use that newfound spare time to start plugging away at a bit of a passion project, something that had been burning away in the back of my mind for quite some time. I decided to actually sit down and put pen to paper. And that was it. It was it was really quite a an organic growth in the early days. I launched in March 2021. I think I I managed to sell 250 pieces in my initial batch and over the years we've just scaled that up. More people have discovered the brands, more people have got hands-on and and and been impressed and yeah, it's it's been a a real organic growth to to what started as a passion project.
Host/Interviewer And so you know, talk about that process and and what you did. I mean, yeah, you worked in the industry based in the UK, you you you designed some watches, but you know, how did you go about you I guess had a design ideas, but how did you go about creating you know, assembling, building that first watch and and and also talk about, you know, the the name Studio Underdog, which has been the name from from the get-go, right?
Richard Bence For sure, yeah. That was uh that was the name from uh from day one. I think it's a good representation of uh of the brands, whether it's in its early days. I still think we're very much in our early days. We're a design-led brand. We act as sort of a design studio and we're very much the underdogs. This is uh uh what started off as a as a one-man brand, uh a brand based in the UK. We've got a a long way to uh to go to to really kind of compete with some of the big boys or compete with the Swiss watch industry. So I think it's gonna be uh a long time before we ever have to consider rebranding as the business grows, uh if we if we grow out of being an underdog, I don't think that's ever gonna be the case unless we take take some market share from Rolex, I think we'll forever be an underdog.
Host/Interviewer But how did you, you know, so you had a design in your mind, how did you, you know, go about actually producing these watches. Obviously, you were not a manufacturer at the time, although you know you certainly now have assembly and and aftermarket um facilities. But yeah, tell us about you know, because this is the dream, I think, you know, for many for many people, how you know how to start a watch brand. And it's it's not easy.
Richard Bence Well I think it probably on the surface of it when people hear about the brand and and and feel like it's come out of nowhere. And certainly on day one when we launched, we were probably looked more advanced and more established than someone might expect from a passion project that had been developed over a few months. The reality was it was niggling away for years in the background. I spent six years in industry. That included not just refining my design skills, but that included trips to Hong Kong to meet suppliers. Uh I suggest you know, I get a fair few people asking me uh enthusiasts looking to do something similar and I say the things you gotta do is get over to the Hong Kong Watch and Clock Fair in September uh and and uh take a trip to Switzerland for EPHJ, uh the supplier fair. And
Host/Interviewer coming up uh next coming up next month, and it
Richard Bence really is I I thoroughly enjoy those trips, not only to to connect and and catch up with with part of my supply chain, but it's kind of a bit of a Disneyland. You can walk around these booths, you can go, I recognise that sapphire crystal, I know who you're working with. Oh, I I I've seen this bracelet launched recently. I I see what's going on here. So it's quite incredible to see and put the pieces of the puzzle together. So I I certainly, when I came to market,s I had a foundation. I had some relationships with the suppliers and partners that I wanted to work with. Unfortunately, because I had that relationship, they were willing to effectively invest or take that risk in me as a as a young entrepreneur uh looking to place initial orders that fell typically under their MOQ, their minimum order quantity.
Host/Interviewer Yeah, I mean that MOQ, as you say, I mean this is part of the biggest challenge I think for for new startup brands is that you know they're looking for components and suppliers, but indeed they fall under that MOQ. And so that's about relationship building, I I presume.
Richard Bence Yeah, that's that's how it worked uh worked for me. And of course we're we're fortunate now with the the volumes that we're doing that um you know, those MOQ concerns are less of a concern as such.
Host/Interviewer How did you finance, um, this operation, did you di you know, what was that loans? Was it, you know, did you have investors? Did you use your own capital? How did it work?
Richard Bence I guess a a little bit of a mix of both. Uh we don't have any investors, so uh to this day we still don't have any investors. I had uh a little chunk of change that I was saving for a house deposit and uh my parents uh advised me that it's probably not best to throw that into uh a new venture uh considering whilst I am an entrepreneur, this is very much my first venture into entrepreneurship. So what I wanted before I took that risk was a proof of concept. If I'd gone to any business advisor and said I want to launch a watermelon themed manual wound column wheel chronograph uh and I expect it to be a huge success, I think uh I'd have been told to to get real pretty quick. So I went to the proof of concept. So my very first introduction was a crowdfunding campaign where effectively I managed to get around about 250 people to put their hard-earned cash down, a full 100% deposit effectively.
Host/Interviewer Correct. Yeah, yeah. Correct. And obviously those
Richard Bence people, those first two hundred and fifty people, took a risk. One of those people happened to be uh Nicholas Affears, actually. He was uh a supporter from the outset. And that gave me my proof of concept. Once I had those two hundred and fifty people saying, look, we're gonna take that risk, we're gonna put the money down and hopefully we'll get a watch at at the end of six plus months. That really allowed me to feel a lot more comfortable investing some of my own capital. Um, and of course, we're we're not talking crazy numbers here. This this was uh in the brand's infancy.
Host/Interviewer Indeed. And and so what should should we think about? I mean, yeah, you your you know studio underdog watches are assembled in the UK. What should we think about, you know, in terms of you know you talked about going to Hong Kong, you talked about going to EPHJ. Do you do you make any claims about, you know, Swiss made or or anything like that? Or how do you, you know, decide what components to use in in various models and and is it important for you, you know, where those are sourced from?
Richard Bence Absolutely. And it was a question that I've asked myself a a hell of a lot because to commit to assembled in Great Britain, I guess if you wish to call that a label as such, that carries little to no weight compared to the likes of Swiss made, right? But for me, I felt
Host/Interviewer there was real value in it's quite
Richard Bence an honest message. It's uh it's a part of the process that we're doing. It's something that we are proud of. We're willing to talk about it. And whilst maybe it carries five to ten percent of the weight of of Swiss made, it's something that we have real ownership of. Many brands that that come to market, if you wish to meet the criteria for Swiss made, factory supply chain will help you do that. And of course, there's there's absolutely some some loopholes that uh that sort of uh brands are able to leverage to meet that label and also be able to offer product at a a competitive price. We source uh materials, movements uh from all over. You know, our straps are made by a British independent here in the UK. Um our movements, we use Chinese movements, we work quite closely with Seagull, which is a a a relationship that is is really important, maybe something we'll touch on in a little bit more detail shortly. And of course the likes of Salita uh as well. And then you've seen through some recent collaborations, we've had the opportunity um to work with I guess a different part of uh part of the Swiss supply chain, which is which has been a real eye eye-opener as well. Um so it gives us a huge amount of freedom and flexibility, bringing everything here into the UK, assembling it ourselves, gives us a huge amount of control. Uh and I guess, yeah, I guess this is me admitting that maybe I'm a a bit of a control freak.
Host/Interviewer Well indeed. I mean, you know, this is a um as the entrepreneur and the head of this venture, I mean, that's a kind of a necessary um thing. But you know, you've grown um quite a bit since those days, since that launch in I guess 2021, that started in 2020. You know, talk about where we're at now. You said you you're making you made about 14,000 watches last year, which is not insigni an insignificant um size, right? I mean, that's um quite a fair bit of volume. And so yeah, I mean, I think the most recent interesting transaction you did in the sort of the biggest business step that you've made is you acquired, you know, full control of the assembly facility and company. I think it's called Horologium. Is that a
Richard Bence mouthful, absolutely, yeah. Horologium.
Host/Interviewer Yeah. And and so talk about, you know, why you did that and where you are in terms of, you know, staffing and size now and what your operation looks like. Sure.
Richard Bence So as I said, if I was going to champion this assembled in Great Britain message, I really felt like I needed to have uh have ownership of that. There was a a small risk that through working with a third party you don't have that that level of control. If the team at Herologium had decided that they they no longer liked the sound of my voice anymore, that would put me in quite a predicament. And vice versa. You know, we had got to the point where because of the growth of the brand, we were close on ninety percent of their revenue. And that's not a good position for them to be in as well.
Host/Interviewer Completely dependent on on your business indeed. Yeah, yeah.
Richard Bence Exactly. So it's a it's a it was a bit of a we both felt like we were um in a risky position and uh there was some obvious solutions really. The first step that that we took to to de-risk was back in July 2024. So we became uh a minority shareholder, which gave a little bit more comfort. That really cemented the relationship and was was more of a gesture in the fact that neither party were going anywhere and we could both kind of rely on each other. And importantly for me, I could uh start to communicate this assembled in Great Britain message with a little bit more confidence. In December of last year, so December twenty-five, uh, that minority stake increased to to full ownership. And there was two key reasons for that. One, as I touched on before, huge level of control. You know, we we really get to uh to own that process, uh pull as many small levers as we want to to make tweaks and refinements and optimizations and also making sure that everything that side of the business did was in the best interests of Studio Underdog uh as as as the key brands. The other thing that the that that we gained access to was was opportunity. We as a young brand, five years old. Most people know us from the digital realm. They've seen this this online brand come to market and maybe they've had an opportunity to meet us face to face at events,
Host/Interviewer but this gives us a real home. So we
Richard Bence um, you know, as part of the acquisition and and over the last few months we've been slowly making the the building ready, uh which which we've coined the doghouse. So we we plan to open our doors uh and allow customers to come and meet us. We'll have a showroom, we'll have an assembly experience. So it it also unlocks a huge number of of opportunities that we just wouldn't have been able to to execute, certainly to the level that that we plan to execute this year without that deal going through.
Host/Interviewer Indeed. And so, you know, this is going to give you a physical, in fact, a bricks and mortar presence in the near future. Is that, you know, it's interesting. I mean, obviously you started as an online only brand. What's your sense now of you know how you find more clients or people interact with watches? I mean, how important is it that people have a chance to see, touch, and feel products uh before buying them, particularly in your price range, which is obviously more approachable and entry level with not everything, but um you know, mm mm most of your products.
Host/Interviewer I think look there's there's no question it's it's
Richard Bence important. That being said, ninety-six, ninety-seven percent of the volume that we do is direct to consumer through online sales. And I'd imagine the vast majority of those sales, you know, may have not had the opportunity to get hands-on before. That is where it's so critical for us to be as transparent and open as possible. The research that customers will do will often be reading up on the brands, reading reviews from from independent uh writers. You know, I I believe we've got a a few hands-on uh pieces on on Hidinki as well. So I'm sure that's gonna long way. There's there's no question. But
Host/Interviewer as the brand matures and and levels
Richard Bence up, whilst we don't expect the sellro-ughth within our showroom to be a considerable part of the business. Even the sheer fact that it exists will move the needle, as far as I'm concerned. It gives us it gives us a door. If someone has a a service request, knowing that if they really wanted to, they could come and they could knock on the door and we'll be there and we've got nowhere to go. So I I think that makes a real tangible difference as well. I'm looking forward to welcoming people through those doors. And I'm hoping the people that do make the effort to come will be a microphone really for the incredible things that we're doing to showcase what assembly in Great Britain actually means what that looks like to see part of the industry here. You know, the volumes we're doing are great, as far as I'm aware, we're the largest assembler of mechanical watches in the UK. That's not to say we're a big business. That's to say it really doesn't exist.
Host/Interviewer Yeah. So we've been been growing that
Richard Bence side of the business out. Um it's not easy hiring, finding that level of expertise. We've recently introduced over the last six months um a training scheme and and system. We've got I believe three new starters joining in the coming weeks um which will help us increase our output of course. So yeah, we're looking forward to to really showing this this flourishing and and growing business and and being proud of it really.
Host/Interviewer Yeah, no, it's it's it's quite interesting and and quite unique and unusual. Uh there are, of course, other UK-based watch brands. You know, we had Mike France from Christopher Ward on the show quite recently. There's Braymond. You mentioned Fears, who you've done um collaborations with. You know, what, if anything, did you learn from or or take away from you know the experience of any of those brands in how you've gone about building Studio Underdog? Obviously, you know, you know, Braymont is is one we think of that's been sort of h high profile over the past more than a decade. And you know, they've had their ups and downs as a is a UK brand, you know, manufacturing, etc. etc.
Richard Bence Uh hu age amount. There's no question. When I I was very fortunate, and and I think it's something that's potentially quite unique to the British watchmaking space, is as I was starting my brand, I was knocking on doors. I was really trying to pick people's brains and I was very surprised to to have the those doors opened rather than me being pushed away as hold on, you're you're coming here as a potential future competitor to to pick my brain, that that was not the case. So I've got a great relationship, a great friendship with uh with Nicolas Affires. As I said, he was one of the early supporters from the outset. Mike France was hugely accommodating, uh has given me some great advice over the years. Even you know, David I ha I have a a really good relationship um with and I I've been to visit the wing. David
Host/Interviewer very much. Absolutely, yeah, to to see
Richard Bence the um you know the the work and and the scale of the the business that they're operating. So I've I've been able to to pick a lot of brains. There's a lot of bits of advice that I have categorically ignored or gone in the total opposite direction of, but there's uh even more advice that uh that I've very much taken on on board which has helped to to shape the brands to an extent. But with all that said, the it this assembly part of the process for me certainly is is kind of new territory. We're trying to do it in a slightly different way as to to maybe others have have done before, despite the business that that I'm growing and running. I'd actually say I'm quite risk averse. So so I like to think the decisions that I make are are relatively strategic and and well grounded. Um who knows, maybe uh maybe in a few years time people will say otherwise. I've got some advice from from very reputable uh people in industry that assembled in Great Britain is not the way to go. Don't do it, Rich. Um but you know I have to carve my own path.
Host/Interviewer Indeed, indeed. And so let's talk about some of your your your product
Host/Interviewer offerings now. I mean, remind me,
Host/Interviewer you know, what the the the price of that first watch and was the watermelon watch the v the the first watch, I think it was um it was. So what what was was the the the price on that? What was the movement inside? And then you know where are we now in terms of your average price? And you know, you have some models that are permanently in the collection, then you continue to do collaboration Aaron Powell So
Richard Bence the O one Series Watermelon and the other products within that collection, they're currently at uh 550 pounds. They use um uh Manuel Own's Column Wheel chronograph from from Seagull, which allows it to be that competitively priced. We're on the third generation of that, so we've made some incremental improvements over the years. We have our O2 series, which is our field watch. We're working towards a new generation of that, which hopefully should be launching in the coming months. That's around, I believe, the £850 pounds mark with a Swiss solita uh movement. And we've got our O3 series, our salmon, which is I believe around 1750 GBP. And that again is a solita and MonoPusher SW510. So I'd say we're we're quite competitively priced. The majority of the sales that we do are our O1 series followed by our O2 series. I think we're able to offer a huge amount of product again because we focus on on the D to C model for for quite a um a competitive price, you know, whilst offering a lot of fun. What we say is we make serious watches for serious collectors that don't take themselves too seriously. And I'd imagine a lot of people would just assume studio underdog, they start with the fun. They start with the play. But the reality is that the play and the fun comes almost at the end as as a as a bit of a a twist Aaron Powell
Host/Interviewer Yeah, no, it's it's quite you
Host/Interviewer did I think I was um covering the industry back in 2022 when you came on board and it was just it was quite um fortuitous timing. I mean, you know, the world was looking for, you know, there was there was it almost a shortage of product, and you really were able to make a splash and everybody sort of you know picked up on the brand. I mean, was there any specific initiatives or or you know moves that you made that you know got you that um that profile? Because yeah, you you made quite a splash when you when you started.
Richard Bence I wish I could uh pat myself on the back and and tell you about all my strategic planning and you know how it was destined for success. But the reality was I was just designing for myself. And maybe that was a case as as an enthusiast, as a collector, I was potentially feeling fatigued with with the industry at the time. And this was my rebellion as such. Who knows? I was just designing a watch for myself that that I wanted to wear and I hoped that it might resonate with others and it certainly certainly did and continues to as well. The watermelon is is still our most popular, our best seller uh to date. And one thing I'm quite proud of as well is that collection, that 01 series, whilst we are on the third generation of it, it's not like we've been making new colours every month and just swapping it out. Those four items are are the ones that we originally launched with and those four items are the same collection today. And that's a strategic decision as well. That I think is really setting us up for the long term to cement these products as, you know, as as I guess m making their little place, uh their our little dent in the industry as such, rather than taking, I guess, a more of a a fashion led approach, which I'm sure would pay dividends in the short term. You know, the the watch industry is as we know is is a long term game. And I think that that that's the approach that potentially makes studio underdogs stand out. Again, people assume we're just the fun, goofy brands. But the reality is, you know, the the first nine steps are are all of quite serious, uh quite structured, and then that that tenth is the uh is that playful twist uh that that I kept referencing.
Host/Interviewer Yeah and let's talk about um collaborations.
Host/Interviewer I mean you've done several over the years Christopher Ward, Fears, and then sort of, you know, the one that
Host/Interviewer was in some ways the most high
Host/Interviewer profile was with H. Moser. And that was a a collaboration where, you know, you both produced a watch and they were sold together. Some of your clients or fans or customers, you know, perhaps felt a little uncomfortable with that situation. I think it was a, you know, it was a 50 or 60,000 franc um watch from Moser that um needed to be purchased together. But yeah, talk about that collaboration. Do you think it was you know the way to go and and will we see more of that in the future from you with with sort of high-end collaborations like that? So
Richard Bence that as a designer, there's no question that was a dream come true project for me. You know, the brand at the time was just over three years old. There's very few um independents or Swiss brands to to that level that would be willing to even consider taking the risk uh on a on a small up and coming uh company. HMOS are obviously willing to take that risk. We broke a few hearts, there's no question. Um I I think the the biggest learning from from from that launch for me was if I'm honest, I wouldn't change the product. I love it. I loved the conversation that that kind of created, these two watches being sold as a set. The thing that uh was maybe a bit of an oversight on on my part was I pitched not only the the the product, the kind of the the duo of watches, the design, the storytelling around the product to the team at Mozer, but also the build-up to the launch. And one thing that we enjoy doing is building up that excitement, that buzz, that height. And I wanted the unveiling that Studio Underdog was collaborating with H. Moser to be the final kind of surprise at the end on the effectively the the fourth day of of teasing.
Host/Interviewer Right. But what that resulted in
Richard Bence was, you know, or or the way, you know, I'd structured it and planned it was Studio Underdog was releasing uh and building up to a campaign and Moser was doing the same alongside. And for those that were tapped in, you'd start to see this crossover at a different sort of uh a different day. What I didn't take into account was a customer base that loves uh and supports and knows studio underdog that doesn't and didn't know who Moser were. For me as an enthusiast, that that kind of I I hadn't even considered um that sort of segment of the market. So for those folks, what that resulted in was four days of teasing, of getting excited for a new studio underdog launch, for the grand reveal at the end to be this collaboration with a brands that maybe they didn't know and and a price point that that felt quite out of touch. Um it was a small but but certainly a kind of a a a
Host/Interviewer vocal um you
Richard Bence know a vocal part of my community which I absolutely listen to. There's there's there's there's no doubt um but I think one thing that even Mosa were were pleasantly surprised at was the number of studio underdog customers um that were still interested in this product. Whether interested means, you know, making a purchase or even just uh just supporting the project, supporting me as a designer and and seeing that three years prior or years prior I was designing a minions watch that sold for the grand total of seven pounds ninety-nine um to to having the opportunity to design and work with the team at Moser for a a piece that was yeah closer to the the 60,000 Swiss franc mark. Um it felt so
Host/Interviewer No doubt. Yeah. And so, you know, where
Host/Interviewer should we expect or what are your ambitions in terms of collaboration and in terms of the evolution of the product and the brand. I mean, you know, you have that core collection with the O one series, but will we see you moving up and premiumizing, which is the trend in the certainly in the industry right now?
Richard Bence I'd say yes and no. I'd say you know, I'd imagine a lot of people will ask that question with with almost a a bit of a sinking heart. It's what everyone else is doing, it's what the industry is expecting. You've seen through collaboration that Studio Underdog can justify a higher price point and there's a market there. And we've, you know, been able to do in a short space of time, build that credibility, that confidence and that trust with our consumer. So I am really proud of the fact that through collaboration we have been able to touch some higher price points. But we also need to make sure that people, when they think of Studio Underdog, they don't just think of us as a collaborator. You know, I love the work that Second Second does. Second Second is not a watch brand. We are. We need when people think about Studio Underdog to think about us and our core collection as well as the collaborations. So this year we're we're focusing on core. You know, we've we've kind of last year collaborations was a critical part of the strategy. This year we're kind of uh we're looking inward a little bit more. And whilst I I I do see, and I think it's quite clear that the learnings through collaboration that there's a market that is interested in studio underdog at a higher price point, there's no question that that what has led to the brand's success is to an extent a a value proposition, you know, being competitively priced, being a playful part of someone's collection that that isn't breaking the bank as such. Uh obviously it's it's all it's all relative, but we have a huge number of our customers that will have their watchbox, they'll have their speedy, maybe they'll have their independent, their MOSER, they'll have their date just, and then they'll want something to show off their more playful side of the collection. And Studio Underdog can do that uh at likely what will be the most uh affordable piece that they're looking to acquire. And it also shows you're tapped in as well. If you're if you see someone wearing that date just on on the tube, whether they're a watchperson or not or or you could start up a conversation is is anyone's guess. Whereas if you see someone rocking a studio underdog, you know you can uh uh can have a chat.
Host/Interviewer Yeah, they're a watch person. They're an enthusiast,s no doubt. Yeah, for sure.
Richard Bence So so going back to to kind of answer your question about, you know, will we be pushing up? What's the what's the strategy? I don't want to say too much. We are we are developing an O four series. One thing that that we've kind of been working towards is this this fight for credibility as such. And I think the next uh obvious step for us is venturing into a little bit more kind of technical development, maybe something um offering something slightly more unique uh with the movement. We're not we're not working towards an in house movement at the moment, but we're certainly looking to offer something quite unique. And I would very much uh the intention is very much to surprise and delight the community by maintaining the accessible price point and and I guess I almost don't want to say bang for buck um but um, you know uh, yeah, the the next launch certainly isn't going to be tens of thousands or or or multiple thousands for sure. We're gonna keep it uh more attainable.
Host/Interviewer Interesting. And any plans to
Host/Interviewer shift or you know change
Host/Interviewer at all your distribution model?
Host/Interviewer Obviously, as you say uh oh you know, over ninety percent is online, although you do have some retail partners, I think, with time and tide in London and maybe New York, but yeah, tell me.
Richard Bence Yeah. So so we we work with Time and Tide uh for for their three Discovery Studios, Melbourne, London and New York. Um it's been great for us to of course get product in front of people. The reality is we've we've set up the business uh on a as a direct consumer model and that's what our margins are based on. Uh so to grow out retail in any significant capacity really comes at the cost for margin for us. Right. We have control of our supply chain now. We have control of our assembly output. The first four even now, five years, the level of demand on the market has has really been more than we've been able to um to assemble. Of course, that's a that's a problem, uh, maybe an artificial problem that that others in the industry have, but the challenges with the infrastructure here in the UK, you know, uh have made that the case. What that means is we've not been hugely motivated to sell anything other than direct consumer because we have the consumers there, you know, digitally lining up at the door. Now that we have ownership of the supply chain, we are able to increase that output. Finally for the first time ever this year, we've been able to to put some some stock uh online so it's more readily available rather than exclusively launching via drops, which we'll continue to do for our LEs and special editions. But that's certainly a maturing of the brand. And then the next logical question is, well, what does further distribution look like? I don't think it certainly in the in the short term or even the long term, to be honest, that uh traditional distribution and and retail will be a part of the brand strategy. We are looking to expand our retail partners really by hand picking those that we feel like will almost be ambassadors for the brand. And those decisions are not really based on margin or additional revenue that it might unlock for the brand. It's more about positioning, you know, uh who we want to get in front of as such. So we'll see. I think the the first learning we'll have is with the opening of the doghouse, with our first own run physical space, you know, to have our showroom to have customers come and and book fire appointment to get hands-on with our product, see the collection, get under the hood of uh of the brand. No doubt we'll take some learnings from that. And of course, I tuned into your interview with Mike France and uh uh I'm in awe about the the growth that he's had in terms of physical retail, which he total ownership of uh through the US and and his plans for growth there. So I'm I'm sure I'll I'll I'll continue to uh have my ear to the ground on that one.
Host/Interviewer And so am I right to think then your biggest challenge these days is is production and and
Host/Interviewer making the product as fast
Host/Interviewer as possible or or to meet demand? Is that your biggest challenge these days? Is it about staffing? Is it about capital?
Richard Bence Historically, I'd say, you know, up until the last six months, really until the acquisition, yes, I'd say the the the assembly was it was a bit of a bottleneck. And of course it's in a way a good problem to have because what that created was an additional buzz. We were able to to leverage the fact that it's common knowledge that if you want a good watch, you have to wait, right thank you Rolex we've been able to to to leverage that and and you know explain our drop model um and customers have been quite understanding now we have the ownership it's it's less of an issue. Of course, with ownership comes a lot more responsibility. Overnight we went from a team of seven to we're currently a team of twenty-six and likely by the end of next month, you know, we'll we'll be a team of thirty. So the business
Host/Interviewer as as a whole has certainly scaled.
Richard Bence But of course, so has our assembly output, so has the product offering that we've been able to bring to our customers and our community, the growth in our community as well is is something that that we're s we're super excited about as people discover us every day. The biggest challenge I'd say that that that we have these days meeting the expectations and the growing expectations of the community. Um I'd imagine there's there's a lot of people that that still think of Studio Underdog as a one-man brand. They probably think of me working away in the in the corner of my living room as as I did four or five years ago, I think we've had this fight for credibility over the last couple of years, and I think that's something that's never really going to change. And to do that, I think it requires taking risks, it requires uh pushing the business forwards, the risks that we've taken on as the acquisition. We've developed you know, we're we've invested six figures into the redesign and development of the doghouse, the interior to make it customer ready. Uh' weve gone one step further to make sure that this is our home and the fact that we can invest these sums of money into this building. We've you know we we've purchased the building uh as well, a seven figure investment to to have a home, a long-term home for the brand. These are all kind of the necessary risks that I feel like we have to take at this stage. And the next chapter for us is really innovating from a mechanical standpoint, which as as you're well aware, takes huge investment, is is a huge risk. Um but that's what's gonna separate us. You know, that's that's how we uh we will be able to continue to to stand out. So exciting times ahead, you know, a few more sleepless nights uh for me. But hey, this is what I signed up for.
Host/Interviewer Excellent. Very good. And you know, last thing, what's your sense of the market right now and how much insight through your orders and customers do you get into various regions, I wonder. And obviously, you know, you're at um uh a more approachable price point. But yeah, I mean, you know, what what's your sense of of of global demand for for premium watches these days? There's a lot of uncertainty still out there, um socioeconomics, geopolitics, etcetera. But yeah, what's your sense?
Richard Bence I mean, there's there's no question there's been some some tough times, you know, some slight kind of declines in in overall markets. I'm more optimistic. I'll touch on that shortly. You know, tariffs, for example, are a huge, a huge headache, and you know, I'm I'm I'm actually surprised that that we didn't see more brands kind of go under, to be honest. Uh it was really that uh that significant. For us, I'm quite optimistic. I think uh British horology as a segment is is an area that's that's really continuing to grow quite significantly year on year. There's a lot of data from from the Bellweather report um that that that really confirms that. So Studio Underdog as a business is is continuing to grow. Of course, I have to to look at the the bigger picture, but there's so much data and and what little old studio underdog is doing compared to uh to to the likes of of the big mainstream brands, the the top of uh the top brands in the Morgan Stanley. It's it's we have the same product, but uh the brands operate and run incredibly differently. So I do take everything with a pinch of of salt. I am an entrepreneur, so I'm probably more optimistic than I should be.
Host/Interviewer We need to be. Yeah, exactly. So
Richard Bence we're just making sure that we try and do right by our customers, not fall down the trap of, as you mentioned, while the going's good, increasing prices and then, you know, when the going's not so good, kind of being in a a bit of a a hard place, we've done a good job of uh uh of avoiding that for for the most part and we'll hopefully continue to do so.
Host/Interviewer And so, you know, production wise, are you looking
Host/Interviewer for increases? Can you talk about, you know, what kind of growth you might
Host/Interviewer be able to experience this year? And then remind me and how you have approached the tariff challenge. Yeah, I mean, you know, we've saw a lot of brands, you know, we just mentioned Christopher Ward. I mean, they were able to shift, you know, their sort of distribution model um through a US entity were you able to do anything like that to to reduce your your exposure to those US tariffs and um uh yeah what kind of growth can we expect from you this year?
Richard Bence So the US is a is a huge part of the studio underdog business. Last I checked, uh around the forty percent plus mark, uh it's by far our biggest market. So it's critical to the success of the brands.
Host/Interviewer I didn't realize that. Absolutely. Um, you
Richard Bence know, US purchasing power is is unrivaled and and and people they spend, you know, they they spend their money. So it's it's by far our biggest market. so we knew that that that needed to to to be the case. We're we have a long term vision in mind for the brand, or at least the decisions we make are decisions based on the long term. So we took a huge hit in terms of our US kind of margin. There's no question. Everyone did, even with solutions in place. The solution that that you mentioned that Christopher Ward had, you know, we implemented the same. We were were fortunate that we kind of uh were slightly ahead of the curve in in the fact that we'd set up a US entity and then it was just a a bit of a learning as to how to get that functioning and operating and and that's something that we continue to do. It's still a a lot of uh a lot of sort of admin and and work on a day-to-day basis to to get those uh um break bulk shipments in and uh and covering all the the US costs and the tariffs and the duties, etc. But it's the right thing for the long term. It probably meant that 2024 was was maybe a little bit more profitable for us in the in the US side of the business. But of course the the growth that that we've seen over the last 12 months um means it's it's clearly been the right decision. So that answers your questions on tariffs. Where else are we going?
Host/Interviewer And and grow and growth. I mean, you know, um how are you looking to scale production and and and revenue growth? And and it's interesting, I mean, you know, you do mention I mean, the company and the brand is profitable.
Richard Bence The company and the brand is profitable, yeah. You know, we've uh we've not had any um investors on board, so we've been able to to grow the businesses as I mentioned. I'm risk averse. So I I don't like the idea, even though I know it's the sensible thing to do to invest huge sums of money in the short term and and go into debt for for long term reward. That sounds pretty scary to me. So I've uh I've avoided that for the most part, and and that seems to have worked for us. We've scaled the business as I mentioned first year 250 pieces, and and this year 14,600 or last year fourteen thousand six hundred. So the growth and the and the multiples of of the business year on year have um uh have have been quite impressive. This year we're we're focusing a little bit more on stability. You know, we I'd like to see kind of 10% incremental growth in terms of of the revenue, not as such kind of, you know, taking a step back or pausing. We're just focusing so much on the foundations of the business this year. That is the doghouse, that is supply chain, that is innovation. So I just want to to make sure that uh we don't have too many peaks and troughs as such and and that it's a it's a it's a confident continuation of of the business. So you know, with those 14,600 revenue was uh around the nine nine million pounds marked 12 million USD. So we'd like to see that uh you know slightly increase, but uh the target is to be uh there or thereabouts.
Host/Interviewer Excellent. And um remind us when the doghouse will be um open and and and ready for the public and where it is and and and what
Richard Bence So I decided to do this recording in my office in Brighton because the doghouse is currently a construction zone and there is all sorts of drilling and banging and uh you know pieces of wall. I believe it doesn't even have a door as we speak um that is uh that is being painted. So it is yeah it's it's it's a big project. Uh it's something that I'm really excited about. Um I believe we should be complete by um mid-June. We were targeting end of May, but mid-June is is is the new date and open to customers by the end of June. So I would very much like to extend an invite to you or or a member of the team if you'd like to uh to come and see what the the doghouse is all about. And then yep, the it will be open to the public. And one of the things, I guess the last little bit to touch on that the doghouse uh is able to offer us that's quite unique is is an assembly experience. So we'll be welcoming customers in in groups of likely three to four to do most of a day with us where they'll get to assemble their their very own studio underdog watch and hopefully we'll be able to showcase really just how talented and and skilled our team are because they make it look very easy and can assemble a lot of watches per day and uh I've given it a go. My watch wasn't held together by BlueTack, which is good. It worked surprisingly past QC, which I'm quite proud of. But my God, these guys make it look easy.
Host/Interviewer For sure. Richard Bence, the founder of Studio Underdog, congratulations on your success so far and wishing you the best of luck in the future. Thank you for joining us on the business of watches.
Richard Bence Absolutely. My pleasure. Thank you so much.
Host/Interviewer And that's the business of watches for this episode. We hope you enjoyed. Please head on over to hodinky.com where you can join the discussion and leave any comments or questions about this episode or the business of watches in general. Who knows, we might even answer your question on a future episode. Thanks for listening and see you next time.