Phil of the Future

The popular Southern-style, comfort-food restaurant chain collapsed in a swirl of controversy, financial negligence and legal battles after a business partnership went sour. It was Davis’ second failed Cleveland-based venture. He was broke and couldn’t afford health insurance for his only daughter. No one in the restaurant industry would touch him.

It would be enough to scare most people out of the high-stakes game of entrepreneurship forever, but Davis kept on cookin’.

“My thought was,This is the lowest day, so it can only go up from here,” he says.

In November 2004, two days after accepting a job as a box loader for UPS making $8.50 an hour, the Stanford-educated businessman with an MBA from University of Virginia came home humbled and restless. “I needed to reinvent myself,” he says.

Davis brainstormed ideas for another venture. After hours of scanning newspapers and the Internet, he found that men’s skincare products were gaining in popularity. He couldn’t compete with the Gillettes and Niveas of the world, but Davis saw space in the market for a mini-microwave small enough to fit on a bathroom counter to warm towels for shaving.

For that matter, a mini-microwave could also be used in assisted-living homes, dorms, commercial trucks, campers and boats.

At the end of 2004, after a quick promotion within UPS from loading dock to sales, Davis met the president of Cleveland-based consumer product design firm SmartShape on a sales call and pitched him his microwave idea. Mike Maczuzak, who speaks fluent Mandarin and works with manufacturers in China — where most microwaves are made — gave Davis a chance.

“Phil saw an opportunity that I had never previously thought of,” says Maczuzak, who has designed products for Kenmore, Whirlpool and KitchenAid. “He really believed in it, and we trusted that he knew what he was doing.”

Maczuzak agreed to develop the product and gave Davis longer-than-average payment terms.

By November 2006, Davis’ college friend made an initial investment in the microwave idea. He sent a check that helped cover travel to China to meet manufacturers, a prototype and Davis’ living expenses for six months. Davis used a UPS bonus check and his savings to cover the rest. Two weeks later, he left UPS.

“Whenever Phil is pushing one of his ideas, he seemingly has read every Web site, he knows every product trend, and he melds it into a pitch that is very presentable,” says Boake Sells, a former CEO of Revco drug stores and Davis’ friend. “He has been at it in this town for 20 years, and people are still giving him chances.”

Davis marketed the iWave Cube prototype at trade shows, and Sharper Image took an interest. The microwaves, at less than 12 cubic inches, hit shelves in early 2008.

But despite a promising start, Davis’ company — called iCubed International LLC — had a rocky first year. Sharper Image filed for bankruptcy, closing its stores in July.

“We almost didn’t get paid by Sharper Image,” Davis says. “That would have put us out of business before we really got started.”

Davis almost signed a purchase order with Linens & Things, too, but that died when the retailer also went out of business in 2008. iCubed transitioned entirely to an e-commerce model.

Then the stock market started crashing in 2008. The company brought in an estimated $100,000 in revenue from Sharper Image, but it was a “year of just surviving,” Davis says. “How do we get by day to day?”

He found a way. He paid back Maczuzak and got a fair amount of local and national publicity from programs such asThe View andToday as well as magazines such asWired andPeople.

As a teenager, Davis spent his free time fixing cars for a local auto body shop and mowing grass for a wealthy older woman every Saturday.

The entrepreneurial bug didn’t bite him until he was a student at Stanford University, where he took the reigns of a student yearbook project targeted at black students called Imani. As the editor-in-chief, he was responsible for raising money for operation, selling ads, hiring staff and organizing volunteers.

“I remember feeling that great sense of accomplishment when the final product was in my hands,” he said. The yearbook was debt-free at the end of the year. “So I thought,I’d like to do this again. It was always in the back of my mind to figure out how.”

The opportunity came along seven years later, in 1988. Davis was visiting family and observed that his 8-year-old niece was a little pungent after spending the day playing outside. The light bulb flickered on: a stick of deodorant for kids.

Davis left his job with Ocean Spray in Boston and moved home to Cleveland to live with his mother so that he could launch BertSherm, a company that made Fun ‘N Fresh deodorant for children between 7 and 12.

“The biggest decision was stepping away from a job that provided benefits and everything,” Davis says. “But I decided I was going to risk all of that and pursue the children’s deodorant.”

Fun N’ Fresh was picked up by Kmart, Wal-Mart, Target, Revco and other large retailers. But in 1994, BertSherm met a fatal blow when it lost space on Wal-Mart’s shelves. The store was reorganizing its toiletries section and was looking to make more profit per square foot than Fun ‘N Fresh could provide.

Wal-Mart was a third of BertSherm’s sales and half of the cash flow. “We had a good run, but after we lost Wal-Mart, we started to unwind,” Davis says.

His next entrepreneurial venture, the one for which he is perhaps best known, was his Phil the Fire chicken-and-waffles restaurants. He got the idea from a West Coast chain called Roscoe’s and thought the concept had staying power in Cleveland.

An avid cook and baker, Davis tweaked the recipes and opened a brunch spot with his own version of the meal once a week in the basement of the Civic in Cleveland Heights.

At first, customers were scarce. Then The Plain Dealer covered Phil the Fire on the front page of the July 4, 2001, issue.

Suddenly, Davis had more customers than he knew what to do with. Patrons would wait three hours to get a seat each week. He moved his operation to a new location in Shaker Square and started serving all week long.

Things seemed to be going great, Davis says, until Earl Patton Jr., the director of basketball administration for the Cavaliers and a regular patron of Phil the Fire, suggested that Davis get to know his friend Kirk Wright.

Wright was a hedge fund manager in Atlanta who wanted to invest in a chicken-and-waffles restaurant in Cleveland. Together, Wright and Davis expedited the opening of a second Phil the Fire downtown in time for the opening of the 2003 Cavs season — the first with LeBron James.

“Wright told the developer he was good for the money. He wasn’t,” Davis says. “He convinced me that we would work out a licensing deal and that I would get compensated for the use of my name, Phil the Fire. I wasn’t. Most importantly, when it came time to pay the bills, which was his responsibility, he didn’t do it.”

The Phil the Fire restaurants failed. Soon after, Wright was convicted of investment fraud. He killed himself while incarcerated.

Davis says he walked away with several lessons that he’s using this time around with iCubed International.

“You have to understand that a con man is only as good as you are greedy,” Davis says. “Everyone has a level of greed in them.”

In his case, Davis says, it wasn’t financial greed that drove him but a desire to rush the process. He prefers to move slowly now, growing iWave Cube over the next five years. After that, he’d like to rebuild Phil the Fire, he says.

Steve Simon, the president of Chicago-based public relations firm SS|PR, has worked to promote Davis’ deodorant as well as the iWave Cube.

“I represent 150 accounts, and I have never seen a guy like Phil,” he says. “I don’t think he sleeps. He is a great salesman; he has a way of finding funding. I think he might be on the money with this one.”

Catching the iWave
So far this year, Davis relaunched the Web site, and sales are slowly growing.

BJ’s picked up a test order of iWave Cubes in July. If they sell, the wholesale club has committed to order more for the holiday season. Davis expects iCube to be profitable by 2010 and to gain popularity globally as Europeans buy smaller, more efficient appliances for their homes, he says.

“While the sales have not been blockbuster, they’ve been steady,” Davis says. “And more importantly, people are starting to realize that if it makes sense to move from a McMansion to a much smaller home, you might not need the large appliances like you once had.”

Davis’ next order of business is the iFridgeCube and an iToastCube, both of which are in development with SmartShape. They could be out as early as this year, and he continues to raise capital.

Boake Sells is a believer in Davis. “The fact that he has taken the microwave this far is just like discovering electricity,” Sells says. “He was able to create it out of thin air. He had no support system; he had no money. He just had the entrepreneurial drive to get it done no matter what. He could take a shoestring and dirt and make it into something.”