When Ty McLaren started a summer office job six years ago, he had no idea his future co-founder was just a cubicle away.
McLaren met Hiro Shinn in 2014, when the two both worked as summer analysts at investment bank Rothschild. The pair bonded over their shared connections to Hawaii and being "hapa," a Hawaiian word used to describe someone who is partially of Asian or Pacific Islander descent.
The friends were so simpatico, in fact, that they started a business honoring that heritage. In August 2019, McLaren and Shinn launched sustainable skin care brand Koa.
Today, Koa products are sold at Urban Outfitters and The RealReal in the U.S., and the company is aiming to expand retail to Canada and Japan.
But it all started with Hawaii.
"The soul of the company is in Hawaii," Shinn tells CNBC Make It.
The 'hapa' connection
On their first day working as summer analysts at Rothschild, Shinn overhead McLaren talking about being from Honolulu, where Shinn spent most of his summers growing up, traveling between New York and Japan.
McLaren, who is Japanese and Irish, recalls not having many Asian peers at the banking firm besides Shinn, who is also Japanese and Irish. They talked about their similar upbringings, ate lunch together and hung out every weekend.
"You can immediately catch a vibe from somebody that just kind of understands the same things that you understand," Shinn, 28, says. "It's kind of ineffable: There's some references you just get, and it's easier to get along."
Both men also wanted to start their own business.
Initially, it was appealing to "feel like we have more control over our work lives," McLaren, 29, says. And Shinn says that he felt "boxed in" working at a bank, and he and McLaren are "probably a bit more risk-seeking than the average person who stays with sort of the corporate track."
When they were tossing around the idea in 2015, it was also on the heels of the direct-to-consumer start-up boom, and they were inspired by brands like Warby Parker, Casper and Away.
"All of these now-blue chip, publicly traded companies were in their teenager years inspiring everybody to think: 'There's this whole ecosystem of products that we could just do better by serving them on the internet to an audience that cares and thinks like us,'" Shinn says.
So, the friends – who by that time worked at different jobs – met for regular brainstorming sessions at New York City bars, restaurants and coffee shops dreaming up brand ideas.
It was another shared experience – "horrible skin care experiences" growing up, says Shinn – that landed them on starting a skin care brand. (At 18, Shinn had a melanoma scare and McLaren took "pretty aggressive" prescription acne medication in high school that caused him to sunburn easily.)
Koa, a sustainable, gender-neutral and affordable line of skin care, was born.
Launching a brand with Hawaiian values
"Koa" means brave or bold warrior in Native Hawaiian language, McLaren says, and koa wood is very important in Native Hawaiian culture – it's used to make voyaging canoes, weapons and sacred daily use objects that are often passed down as heirlooms, he says.
"We like the name because it was simple and represented this cultural importance in Hawaii," says McLaren.
The co-founders also wanted to "reflect our own values in what we built," they told Forbes, "which is why Koa emphasizes sustainability and thoughtfulness in everything we do."
Growing up immersed in Hawaii's diverse ecosystem, they were always taught to be "good stewards of the earth," Shinn says.
"The world doesn't necessarily need more stuff, so we want to make our products in the least harmful way possible," McLaren says.
Indeed, they were intentional about finding manufacturers who shared their values around environmental protection to make sure their supply chain was as sustainable as possible. Koa's product packaging is all recyclable, and is shipped in 100% recycled paper boxes. The company also donates a portion of proceeds to organizations that focus on ocean preservation initiatives.
The line features four products: cleanser, moisturizer, toner and sunscreen ranging from $18 to $27. The best seller is the tinted sunscreen, which is also available in a clear formula, and is considered "reef safe," meaning it doesn't contain oxybenzone and octinoxate, ingredients that have been shown to be harmful to coral reefs and marine species. (In 2018, Hawaii became the first state to pass a law banning sunscreens using the ingredients.)
Making 'the plunge' and leaving corporate jobs
Even once they started developing the line, McLaren and Shinn kept working at their day jobs for a year so they could bootstrap the company, "doing product and brand development work on nights and weekends," McLaren says.
They spent a ton of time "reading hardcore white papers and peer-reviewed research" about ingredients found in popular skin care products and combing beauty blogs, McLaren says. Once they decided what the products would be, McLaren was introduced to a cosmetic chemist who had previously worked at the L'Oreal Group to consult on the initial formulations.
McLaren and Shinn also brought on another friend from Hawaii, Kapono Chung, as a co-founder and creative director to develop Koa's aesthetic and branding. Chung, who also heads up Chinatown-based design consultancy firm Combo (which has clients like Away, Target and Spotify), is of Korean, Native Hawaiian and Scottish descent.
By 2018, McLaren and Shinn realized Koa needed all their energy, "so, we decided to make the plunge and leave our jobs [to] go at this full time. That was a little bit scary," says McLaren. As young people without kids and families of their own, it felt like the right time to pursue something new, McLaren says.
When Koa launched, they kept it low-key. "We turned on the website and prayed people would come," Shinn says.
"There's this joke, when you launch your company the first day of sales is completely not indicative of your performance because all these people just buy your stuff," Shinn says. "But [customers] keep coming back, which is great."
Of course, McLaren and Shinn had no idea that a pandemic was just around the corner.
During Covid, their supply chain "got totally blown up" as manufacturers shifted to creating personal protective equipment. Lead times got longer and some of their partners closed their businesses, McLaren says. And, with more brands prioritizing online retail, digital advertising got more competitive and expensive.
Even now, over a year later, they're still dealing with some delayed response times for supplies that they need to create more product. "I'm frankly just really happy that we were able to get through it and be okay," McLaren says.
Koa declined to disclose the company's revenue or sales figures for specific products, but McLaren says Koa year-to-date sales have grown 100% from this time last year.
What it means to be an AAPI-run brand
With Hawaii and hapa heritage at the core of Koa and the identity of its founders, the recent rise in hate crimes targeting members of the Asian-American and Pacific Islander community has "put into perspective how people that look like me are viewed in America," Shinn says.
As a biracial person, Shinn says he has been "exposed to two sets of ideals" his whole life, which expanded the way he viewed the world. "Being mixed-race just automatically puts you into the space where you have to be kind of open-minded and not really subscribe to one dogma," Shinn says.
Growing up in Honolulu, McLaren says "the vast majority of my peers and people I interacted with were mixed or Asian." It wasn't until he moved to the continental U.S. for college that he experienced situations where people asked him what ethnicity he was or had situations being the only Asian person in a room.
(In 2019, 37.6% of the population of Hawaii was Asian, and 24.2% of the population was multiracial, according to the U.S. Census.)
McLaren says that being biracial has also afforded him privilege that many Asian-Americans do not have.
"In the landscape of being Asian in this country, I definitely benefit from being part-Caucasian, not having moved here as a first generation immigrant, being born into families that have resources and not having to participate in parts of the economy where you're prone to more of these racist incidents," he says.
As a result, Koa has diversified its give-back program for the month of May, so that customers can choose to donate up to 20% of the proceeds of their purchase to Stop AAPI Hate, which helps respond to and track hate crimes against AAPI communities.
"We do our best to take a stand and let people know we're a brand run by Asian people and we're proud to be doing it," McLaren says.