Too many companies starting out are comfortable losing money for too long, Under Armour CEO Kevin Plank said at South by Southwest Interactive on Monday.
Asked for advice for a startup in the wearable tech space, Mr. Plank called profitability one of the most undersold priorities.
At a recent conference, he said, panelists were making jokes about running in the red and the audience was chuckling along. "I'm like, what are you doing?" he said.
"Losing money is cultural," he added. "It's a habit. If you get used to losing money, it's really hard to stop. … If I have advice for an entrepreneur today, go out and find out if your product can sell."
During a wide-ranging interview with Fast Company Editor-in-Chief Robert Safian, Mr. Plank also discussed his own company's wearables strategy and the true meaning of innovation.
Holding up his smartphone, Mr. Plank said it took innovation to shrink the electronics its capabilities require to fit his pocket instead of filling a Greyhound bus. But in the athletic apparel business, marketers still make clothes and shoes roughly the same way they always have, so maybe the real innovation is finding a way to put more of the sector's manufacturing jobs in Baltimore or Philadelphia instead of overseas, he suggested.
"When my competition talks about innovation being a new knit upper in a shoe, I roll my eyes," Mr. Plank said.
That's not to say Under Armour has no tech play. Its HealthBox includes a wristband, a heart monitor and a WiFi-enabled scale to track things like motion, sleep, heartrate and body fat percentage. Combined with the UA Record app, users can keep track of their progress toward goals, nutrition and more.
In the last year alone, the company's consumers have logged 2 billion workouts into its database, and 8 billion foods, according to Mr. Plank.
That kind of data can not only help reveal how far people of a certain age and health might run on average, but over time reveal patterns about what works best and even how much exercise could be dangerous, Mr. Plank said.
"Our belief is that data is effectively the new oil," he added.