Brothers Started a Business With $45M+ Revenue in 3 Years

How did brothers Christian and Justin Arquilla become “ex-finance guys” in the business of socks?

The co-founders of Pacas started their entrepreneurial journey back in 2013 — when faced with an all-too-common problem. “I had been walking around New York in loafers, like boat shoes or whatever, all day,” Justin recalls, “and [my wife is] like, ‘Your feet smell terrible, your shoes smell terrible, you have to start wearing those little no-show socks.'”

Justin set out to acquire those no-show socks, but he was less than impressed by the options, most of which either showed or slipped down. Why not create a better product to fill the gap? Justin called Christian to float the idea of starting their own business for no-show socks, and he was all in. The duo launched Gekks, a no-show sock knit with silver antimicrobial yarn that slides into the shoe (instead of onto the foot), in 2015.

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After a few years and increasing requests for women’s products, Gekks expanded its line, introducing a women’s no-show sock for ballet flats. The new design was a major hit, the Arquillas note: By 2019, 90% of Gekks’ revenue came from its women’s products — with 45% from the ballet flat product alone.

Then, March 2020 rolled around. With pandemic lockdowns in full force and fewer professionals going into the office, there was less incentive for people to try Gekks. The brothers had to find another way to generate revenue.

Fortunately, they’d already begun experimenting with another promising sock: one made with alpaca fiber.

Image credit: Courtesy of Pacas

‘”This is super soft, and I’ve never felt something like it before.'”

Several years before, Christian was visiting a North Carolina hosiery mill for Gekks when he encountered the fiber for the first time. “I went into the sales manager’s room,” Christian says, “and he had this cone of yarn on his desk that I felt, and I was like, ‘What is this? This is super soft, and I’ve never felt something like it before.’ And he was like, ‘Oh, well, that’s alpaca.'”

The soft, warm alpaca made Christian think back to when he’d visited his 9-year-old cousin in the pediatric intensive care unit (PICU) and heard him talk about how cold and uncomfortable the setting was. The “lightbulb went off,” Christian recalls. He set out to learn all about alpaca fiber in order to develop a superior everyday product that could also help make kids’ hospital stays a little more comfortable.

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So, in 2017, the Arquillas started the product development process. The brothers bought sample yarn — most of which they sourced from the highlands of Peru, where alpaca coats have adapted to extreme daily temperature fluctuations — and attempted a range of sock designs: everyday, hiking, low cut. The offerings were similar to those from many merino wool companies at the time, but with the benefits unique to alpaca, the brothers explain.

Image credit: Courtesy of Pacas

“It’s like the Ferrari of fibers — it’s the most incredible fiber ever.”

“Everyone’s talking about merino wool as this performance fiber, [and] it is,” Justin says. “Then on the other end, you have cashmere, which is known for its softness and has this luxury appeal. Alpaca is this fiber that literally has everything that merino wool and cashmere have, all in one. So it’s like the Ferrari of fibers — it’s the most incredible fiber ever.”

During the pandemic, the co-founders wanted to explore a baby alpaca offering (which refers to the length of the hair, not the age of the animal), and their investors were in favor of the pivot. There were already proven examples of direct-to-consumer brands selling high-quality socks with charitable initiatives — like Bombas, Shark Tank‘s most successful brand of all time. The brothers realized they could produce alpaca socks at a reasonable price and fill “a massive white space.” So they launched their Pacas brand under the umbrella of Gekks.

At $52 for a three-pack, Pacas are still a luxury sock, but they’re not as steeply priced as other products with that status, like cashmere socks, which can retail for $30 per pair, the Arquillas say.

Image credit: Courtesy of Pacas

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The brothers’ pivot paid off. Pacas officially launched in October 2020 and generated about $400,000 in revenue in its first month. Then, the five-star reviews flooded in, and many of those October buyers became repeat customers in November and December. The Arquillas and their investors knew it was time to separate Pacas from Gekks.

Pacas raised its own seed round and went on to see more than $45 million in revenue in just three years. The brand has sold 3.2 million pairs of socks and counts more than 360,000 customers across the U.S. Additionally, the brand remains committed to giving back: Pacas has partnerships with about 20 local children’s hospitals to provide kids with alpaca socks during their stays.

These days, Pacas is the Arquillas’ primary focus as they continue to scale the company, but Gekks continues to generate $500,000 to $600,000 annual revenue despite limited advertising efforts.

“As you scale, the problems just get bigger and more complex.”

The consumer space has changed dramatically over the past couple of decades, with success no longer determined by relationship-building with buyers at department stores but by the work put in on social media, direct-to-consumer channels and the like. Now, anyone willing to make the effort can be an entrepreneur — which makes the space more competitive, the co-founders say.

Image credit: Courtesy of Pacas

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The Arquilla brothers continue to set themselves and Pacas apart by embracing smart pivots and rising to meet tough challenges — again and again.

“There are no right answers,” Justin says, “and you really have to figure stuff out by yourself. And then it turns into just every day [full of] problem-solving. You think it’s going to get easier, but as you scale, the problems just get bigger and more complex. It never ends. You wake up, solve today’s problems, then go to bed and start it all over again.”