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As climate change threatens snow sports, Seattle-based Evo branches out

By Renata Geraldo, The Seattle Times
Published: March 9, 2024, 6:00am

Bryce Phillips doesn’t remember a winter as warm as this one.

Phillips, who lives in Seattle’s Lakewood neighborhood, is something of a winter connoisseur.

Founder and CEO of fast-growing outdoor retailer Evo, Phillips was a professional skier whose sponsors included Patagonia and Seattle-headquartered K2. He began skiing in fourth grade when his uncle took him to Mount Ashland in Oregon. To this day Phillips skis about 50 times every winter.

This warm, low-snow season, which frustrated skiers and snowboarders and concerned water managers, is slowing demand for ski gear. And for Phillips, worrisome trends in the winter sports industry are causing Evo to think differently about its business.

“This is all of North America in a way we’ve never experienced,” Phillips, 46, said of the winter conditions.

In the Cascades, snowpack levels are below normal with this winter being on track to be the warmest on record globally. Washington’s winter has been affected by El Niño’s higher temperatures and drier air, with climate change adding to the trouble.

Besides climate change risks, the outdoor retail industry declined 3.2% as consumers, who stocked up on gear during the first years of the pandemic, felt the pinch of inflation.

In the face of macro adversity, Evo has strategies including international expansion, travel and lodging, and a long-term plan to scale up its mountain biking offerings. A privately held company, Evo hoped to fill a niche missed by large chains such as REI Co-op and smaller independent retailers.

Keeping it real

Evo was founded in 2001 out of Phillips’ garage near the flagship store, located since 2012 at 3500 Stone Way N. in Seattle’s Fremont neighborhood. For seven years, Evo was in a building now occupied by The Wonderland Gear Exchange, also in Fremont.

Evo has a team of 680 in North America and 450 in Japan. The company presents itself as “building a global community and company like no other” and having “a large vision.”

When he founded the company, Phillips was bouncing between Whistler, B.C., where he was scraping by as a professional skier, and Seattle. He would buy used gear in Whistler and sell it in the U.S., either on the side of the road or on eBay.

Two decades later, Phillips owns one of the shops he once bought used gear from, Whistler Village Sports, which Evo acquired in 2018, marking its first physical presence in Canada.

That acquisition was one of several as Phillips grew the Evo brand. Since then, Evo has bought hotels and snow-sports equipment stores in British Columbia and Japan.

Besides acquisitions, Evo has opened stores in mixed-use projects at Snoqualmie Pass — located across the road from The Summit at Snoqualmie — and Salt Lake City. Like the Seattle store, the Salt Lake City store has an All Together Skatepark; other Evo projects have similar recreation businesses. Evo owns the All Together Skateparks underneath its Seattle store and at its Salt Lake campus.

To Phillips, having Evo stores in tandem with other recreation or even retail businesses brings the Evo brand to life.

“Building a business in a different way has always just been central to who we are and how we want to come out to the world,” he said. “We’ve always been hyper-focused on differentiation.”

That differentiation goes beyond Evo stores. Phillips said he wants the Evo brand to be where people travel to, where they stay and where they rent gear.

Evo’s projects are self-funded and the company has not taken any debt for projects, Phillips said. It received some funding from angel investors, but its projects are paid for through its core business: retail. That’s where Evo has scale and where it has established itself, he said.

Mountains on the “front lines”

Outdoor retail in the U.S. is currently challenged because of inflation, said Kelly Davis, the research director at trade group Outdoor Industry Association. Rising prices reduce the spending power of consumers, especially for an industry where new gear can be expensive.

There is also a correction happening from a pandemic glut in the outdoor sports industry, said Jim Knutsen, Evo’s chief culture and strategy officer. Knutsen joined Evo full time in 2019 after serving as a consultant for the company.

According to Phillips, Evo grew 80% in sales revenue during the first two pandemic years, but sales have been down for the past two years.

“During the pandemic, everybody wanted to get outside and they had time. Many people had a check that allowed them to go out and buy an expensive piece of equipment,” Knutsen said. “We’re just sort of in a correction period after that. And I think it’s a steeper correction than most companies in the industry expected.”

The industry is now trying to figure out how to keep the people who first engaged in outdoor sports during the pandemic, he added.

Seattle-founded REI Co-op is also feeling that downturn. The company has had two rounds of layoffs in less than a year. In the latest round announced in January, REI laid off 357 employees, or 2.2% of its total workforce, as CEO Eric Artz said REI is bracing for a challenging year in specialized outdoor retail.

Phillips said he saw sales decline this winter because of the lack of snow, which experts attribute to a mix of climate change and El Niño, a natural phenomenon that refers to above-average sea surface temperatures in areas of the Pacific Ocean. Around this time last year, several locations in the state boasted above-normal snowpack.

Last year, the Cascades saw average or slightly below average snowpack, though a warm spring caused it to melt early. This year, snowpack in the Cascades is between 50% and 70% of normal, according to data from the National Water and Climate Center. The season isn’t over yet, though, as Washington’s snowpack tends to peak around April 1.

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As the Cascades received significant snow in the final week of February, Evo’s boot fitters were busy on Tuesday evening. A couple looking to get adjustments for snowboard bindings had to be sent away — the snowboard service technician was booked up for the rest of the night, while boot fitters took on two or three customers at a time. Downstairs, the store was relatively empty.

The long-term future of the snow sports industry hinges on whether the world can curb greenhouse gas pollution as outlined in the Paris Agreement, said Daniel Scott, a University of Waterloo professor of geography and environmental management, based in Canada.

“That is the sort of billion-dollar question for you, well, which climate future you’re going to end up with,” Scott said. “And that’s really what’s going to define the future of the ski industry.”

The world is coming up short on emissions reduction even as temperature records fall with unprecedented regularity. According to Scott, February is on pace to be the warmest on record. This winter since December is also likely to be the warmest.

As the climate warms, Scott said, snow seasons will start tilting to more bad years than good.

“The mountains have always been the front lines of climate change,” said Erin Sprague, CEO of environmental advocacy group Protect Our Winters.

The warming threatens companies that specialize in winter sports, such as Evo, she said.

While Phillips said Evo is susceptible to climate change, he remains confident about its future.

Evo’s focus, according to Knutsen, is operating a green business, working with partners that also operate sustainably and getting people outdoors. Evo can foster future environmental advocates if the company takes more people outdoors, Knutsen said.

Growth, and growing pains

In a world where mountains look lightly dusted instead of imposingly white at the height of winter, Evo’s long-term strategy is diversification, both in its offerings and geography, Phillips said, in what he calls having “multiple legs of the stool.”

One of Evo’s bets is growing its mountain biking business as customers trade skis for wheels if the mountain ground is bare.

“Far more people will be able to mountain bike over the longer term than ski and snowboard, like, that’s just a fact,” Phillips said.

Evo is also looking to grow in travel and hospitality. More than a business advantage, he said, “we want to deliver a collection of experiences that is unlike any other.”

Through Evo, customers can pay as much as $7,250 for an eight-day heli-ski trip in the mountains of New Zealand’s south island or $2,500 for an eight-day mountain bike trip in Colombia. Some trips are sold out, including snow sports trips to Niseko, Japan, and to Chamonix, in the French Alps. Customers stay at the Evo hotel in Salt Lake City for as much as $235 a night, a rate that includes ski or snowboard rentals.

Japan “is on fire,” Phillips said. With arguably some of the best quality snow in the world, skiing in Japan is more affordable than at many North American resorts. A one-day lift ticket at Whistler Blackcomb, the Pacific Northwest’s crown jewel, runs $214, a hefty difference compared to a $56 one-day ticket in Japan’s Hakuba Valley.

Japan is also one of Phillips’ favorite places to ski, he said, as well as South America, Europe, the Pacific Northwest, including interior British Columbia, and Alaska.

Evo has driven its international expansion through acquisitions.

The company acquired seven stores in Japan through a 2022 purchase of Rhythm Japan, a gear rental and retail business. In November, it acquired the Bergland Hotel in Hakuba.

In British Columbia, Evo owns Whistler Village Sports and, in 2021, it acquired Whistler-based Callaghan Country Wilderness Adventures, owner of the Journeyman Lodge.

All that expansion comes with growing pains. On top of declining revenues in North America, acquisitions and a climate risk, Evo also has an image to uphold, communicating that the brand is “keeping it real,” as Phillips puts it, instead of looking too corporate for outdoor recreation enthusiasts.

For Phillips, that means being deliberate with Evo’s expansion, such as declining requests for acquisitions and partnerships — which he said he gets weekly requests for. Evo, he said, “isn’t a scalable prototype.” Phillips said he wants the focus to be on impact and relevance for the communities in which it operates.

“This has been a 23-year conversation,” he said. “The human level, that has to exist. It can’t be like a [pitch] deck that everybody, like, sends around.”

Phillips is a partner at real estate development firm Evolution Projects, a separate venture from Evo. The company has developed buildings occupied by Evo and other businesses as well as Evo’s office in Fremont, where K2 skis Phillips collected are displayed by the door of the stairwell.

Evolution Projects is developing the building next to the Fremont Evo store, which will include Brooks Running offices and other tenants, part of what it’s calling “Campus Seattle.” The full buildout will have more than 230,000 square feet of office, recreation and retail space.

Its portfolio includes residential properties at Snoqualmie Pass, the Seattle Bouldering Project facilities near Evo’s Fremont flagship store, and Greenwood Collective, an art collective and venue, in Seattle.

“What we look to do is create gathering places,” Phillips said of Evolution Projects.

He is bullish about the future of Evo, despite the tough retail landscape.

“I love the fact that we are diversifying what we do and where we do it,” Phillips said. “I’m just really excited to continue to deliver these customer experiences in places that are inspiring. …

“We’re just getting started when we think about the global opportunity.”