5 Things to Do Before Launching Your Company

[tweetmeme]So you’ve decided mompreneurship is for you. You’ve found an idea that solves a real problem and you’ve vetted it with more than just yourself. You’re ready to launch your company, right?

Not quite yet.

Having a winning idea is a great start but there are other things to consider. I’ve chosen five tips from my favorite mompreneurs on what to do before launching your company.

1. Set a time limit and then forget it.

Upfront, determine how much time you’re comfortable taking to see if you can make your idea work. This time might be a period away your career or changes in your schedule that impact your kids. Is it six months? A year? Once you have set a comfortable time limit, put that worry aside and get down to business.

2. Define a Go / No Go budget and stick to it.

Calculate how much of your own money you’re able to invest in giving your idea a go. Even if you get outside financing, investors or the bank will expect you to use a portion of your own money. When you’ve reached your budget limit, take a critical look at what you have learned. Make the hard decision about whether or not to continue. You may even decide you need to change course and push your idea in another direction.

3. Embrace the business plan.

No, you won’t be able to answer all of the questions in the business plan at the start and some of the sections will make you quake in fear. But do it–even if you’re not going to show it to any one or raise funding right away. The business plan will help you solidify your ideas and guide you in finding important answers. Remember that the business plan should be a living document. Continue to nurture it as your company grows and changes. It’ll keep you focused and you’ll be that much farther ahead if you do decide to go for funding.

4. Find a sounding board who is not your best friend or your mother.

Objective advice is critical when starting and building your own company. You don’t need yes people around you; you need people who will ask you the tough questions. My favorite small business organization, SCORE, has experienced mentors and valuable resources for startups and most of their services are free.

5. Hire an accountant.

Small business accountants are great resources. They will help you organize your finances and often have large networks of professionals who can help you launch and grow. If you’re not comfortable hiring an accountant just yet, at least get a good accounting software program. There are many costs associated with a startup and you’ll want a solid record of what you’ve spent (and earned!) right from the start.

In the next post, I’m sharing my real-time journey on launching a new product with, “Why Would Anyone in the World Want My New Product?”

Mompreneur Example: What I learned from “Negative” Market Research

[tweetmeme]Those of you who have followed my Stikitty journey know I didn’t listen to my head, just my heart when I first launched my entrance mat product in 2009. 

That’s why when it came to the Stikitty, I was adamant I wasn’t going to make the same mistake twice.

Instead of trying to convince myself and others that the Stikitty was a good idea, I started from the opposite perspective. I told myself that the world didn’t need another cat litter mat. I did full-time research for weeks and used inexpensive market research resources to see if I could prove my negative hypotheses. I knew if I could prove them, that my idea wouldn’t stand the test of time–or a limited budget!

Market research provided guidance for the Stikitty's retail packaging.

Below are examples of my hypotheses and what I found through research:

The Pet Industry is Saturated & There’s No Room for Growth

Through my alma mater I was able to gain online access to industry overviews, articles, and snapshots on the pet industry. I found the Datamonitor reports especially helpful. In addition to industry information, I looked at the strategic and financial performances of key companies.

I found that the $45 billion pet industry has grown for the last 7 years and it is projected to grow for the next 5, albeit at a slower pace. There are extremely large competitors but the industry is fairly fragmented with the top companies commanding only ~35% of the market. New companies are able to thrive with strong branding and good sales strategies.

People Only Spend Money on Dog Products

Through networking, I connected with a retired high-level executive from a leading international pet company. He told me it’s true that the biggest chunk of the ~$10 billion pet supplies sub-segment goes to the dogs; specifically to dog toys, collars, leashes, and more. However, when cat owners spend they spend big on litter and litter supplies–to the tune of nearly $1.9 billion annually.  

No One Wants a New, Different Kind of Cat Mat

This hypothesis was critical–if I could prove that no one needed or wanted a more advanced cat litter mat, I would have to stop right there. Because I knew direct customer insights were crucial and I couldn’t afford formal customer research, I used what resources I had available to “hear” from as many cat owners as possible. So, I:

  • Conducted dozens of in-person focus groups with family, friends, and neighbors with cats; I asked them about their current litter mats and what they’d like in a new solution
  • Visited large and small pet retailer Web sites to read online reviews of cat litter mats
  • Lurked on pet forums to learn of frustrations about cat litter tracking and possible solutions
  • Polled contacts in my LinkedIn pet groups
  • Asked friends on Facebook to ask their friends about cat litter mats and how they’d make them better

What I Learned from Being Negative

I learned that the pet industry is more recession proof than others and it is projecting growth; that cat litter products are a strong segment within this very large industry; and, that cat owners are eager for a lighter, easier to clean cat litter mat that is the right size for their specific needs. I found that cat owners were open to something different and if it solved their issues with traditional litter mats (e.g., too heavy, too hard to clean, not large enough), they would buy something innovative. Additionally, I found a lot of practical information such as how to price my product, which retailers carried competing products, and how to package and display the Stikitty.

Though I wasn’t able to completely fool myself, looking at my product idea from a negative perspective allowed me to listen to my head. I was able to step aside and bring my future customers’ needs and desires to the forefront. I was able to look at things from a business perspective.

I wish you the very best of luck with your venture. If you’re ready to share, please let me know what you’re up to, too!

The next post will be about the 5 Things You Should Do Before Launching Your Company

7 Mompreneur Tips for Market Research on the Cheap

[tweetmeme]Especially if you’re boot-strapping your business, it’s easy to convince yourself that you can’t afford market research.

Don’t fall for it.

Before you go into production of your product you need to understand your market and how it will respond to your offering. Market research can help you answer many critical questions such as who your target audience is; what needs do they have; whether competing products are solving their problems; if not, how will your product do a better job;  how much will your audience pay for your product; etc.

If you can afford to hire an advertising or research agency to test your product or service idea, go for it. But if you can’t, try some of these inexpensive tips to get important insights before you spend your first dollar:

1. Get your hands on an industry report.  

Industry monitors provide critical information about whether your industry is growing, how big your segment is, the key players, and more. Some of these monitors can be quite expensive but you may be able to find full reports or snapshots of your industry online. Your local library or alma mater may provide free access to subscription services that carry these full reports too.

2. Read reviews of competing products online.

Online reviews are goldmines of information because they’ll tell you what real buyers like and find lacking in current offerings. Often, they’ll tell you customers’ perceptions of the product’s value for the money as well. And you’ll know which retailers carry products like yours.

3. Conduct your own focus group.

If you’re creating a product based on something you need and can’t find it’s a good bet that the people you associate with may be in the same boat. For example, if you’re a computer programmer who sees a need for an ergonomically correct armrest, your coworkers are probably computer programmers with arm strain too. Get a group of friends, family, and co-workers together in person to talk about your idea. Sure, in the beginning they’ll all say it’s a wonderful idea, but dig deeper and ask specific questions. Be sure to listen with a critical ear–you’ll be surprised by what you learn!

4. Facebook your friends.

With the new features of Facebook, you can easily limit the views of your posts. Share your product idea and ask for genuine insights from your friends.

5. Ask the social world for feedback.

Several sites like LinkedIn and WordPress let you create online polls. If you’re comfortable sharing your idea, ask your connections to give you specific feedback, including how much they’d pay for your product. You can also mask your idea by asking what your connections like or don’t like about what’s currently available.

6. Check out SCORE or other startup associations.

SCORE started out as the “Service Corps of Retired Executives.” The organization counsels small businesses and their mentors can help you put a magnifying glass on your idea and examine it from an experienced businessperson’s perspective.  And, if you make the decision to move forward, they’ll provide you with inexpensive training on starting and growing your company.

7. Visit an industry trade show.

While displaying in a trade show can be quite expensive, attending one is usually a lot cheaper. This is especially true if you don’t have to travel to the show and just have to pay the price of an entrance ticket. There are a few types of trade shows; some target end customers and others target retail buyers. By attending either of these, you can gain a lot of information about what types of products are hot and what consumers or buyers are looking for right now.

In the next post, we’ll talk about the dreaded B word — the business plan!

Excuse Me While I Digress: A Typical Day

A Typical Day

I’m taking a break from the Gazillion Steps to share something that made me smile today. A blogger asked me to describe a typical day in my life as a mompreneur.

Your schedule is probably a lot like mine so you can guess why I smiled. I was game to try, though, so I thought back over this week.

Each day of this week started with me racing around to get the kids off to school. Most ended with me falling asleep while reading my daughter her bedtime story. Everything in between was as random as can be.

One day earlier this week — was it Monday? Tuesday? I don’t know, but I remember negotiating ad space for an upcoming Stikitty campaign and having lunch with my daughter at school. Then I responded to some customer emails and fulfilled orders. I picked up the kids at school, dropped my son at tennis lessons, and went to soccer practice with my daughter. After dinner, we all sat down to do homework. Then I got back on the computer to answer emails and chat with an overseas partner.

Yesterday I spent most of the day on the phone with my bank getting an international wire to the intended beneficiary.

Today, I’ve spoken to two new vendors, threw in a load of laundry, checked updates from Twitter, accepted a request from an old friend on Facebook, and made two new professional connections on LinkedIn. Then I talked with my husband about our crazy schedule for this weekend.

That’s the way it always is.

I guess it was that way when I worked in the corporate world, too. For me, the difference is that I could more easily separate work time from family time when I had a corporate job. Oh, and I had people to delegate to when things got too crazy.

I miss delegating.

Vetting the Big Idea

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The best mompreneur advice I’ve received so far came from a veteran entrepreneur. He told me not to fall in love with my idea.

I didn’t get it back then.

Vetting the Big Idea

Since “my big idea” was consuming all of my waking thoughts, how could I not be seriously attached to it? And why shouldn’t I be?

I get it now.

What happened to me is very common among entrepreneurs. I was so enamored with my idea that I put on blinders and intentionally disregarded nagging doubts. I pushed full force on an idea that I knew in my heart was going to succeed–despite what my head said.

When I finally let go of my original product concept (read more about it), I was able to see a much bigger, better idea.

Vetting your idea is a critical step in launching your product or service. You need to determine if there is a market for your idea, how much a customer or client will likely pay for it, and how it compares to competing products. 

So take your $100,000 and invest in the best market research firm you can find to put your idea in front of potential customers. Don’t have $100,000? Well $20,000 will get you a pretty good market research firm. Don’t have even that much?

No worries–you’re in great company! Most entrepreneurs boot-strap their fledgling companies and prioritize spending on product development and advertising.

There are creative ways to assess your product or service idea without spending a fortune and I’ll share some that worked have for me in the next post. 

Next post: Market Research on the Cheap

The Big Idea

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There are a ton of incredibly innovative, brilliant ideas out there that never become a reality.

There are a ton of not-so-extraordinary ideas that go on to make millions of dollars.

The Big Idea

What’s the difference? While there are many factors involved in the long-term success of a product or service idea (such as financing, the grit and determination of the mompreneur, etc.) let’s stay with the idea for now.

Ideas that solve real problems win.

It sounds simple enough but what does that really mean? The key word is “real.” And real is in the mind of the consumer, not the inventor. For example, imagine you’re a mompreneur who is an amateur tennis player. You’ve come up with this phenomenal idea for a new tennis racquet for beginning tennis players that replaces the nylon strings in most amateur racquets with a brand new material that improves performance, reduces injury, and increases durability.

These sound like great problems to solve, right?

The question is does the average new tennis player see these as problems? Amateur tennis players often buy their racquet based on which brand they know or on price. Even tennis experts recommend that amateurs focus on head size and length to maximize their early command of the ball.

To sell your new tennis racquets to beginning players, first you would have to convince them that they need to be worried about performance, injury, and durability. And then you’d need to compete with bigger brands on price.

It’s infinitely harder to create a market than to solve an existing problem.

A good place to start vetting your product idea is to ask yourself two questions:

Is there a better way?
Does anybody want and need a better way?

We’ll talk about creative (and inexpensive!) ways to determine the answer to the second question in the next post.

Next: Vetting the Big Idea

Pre-requisite #1 for Mompreneurship: Kids

[tweetmeme]So what’s the difference between a mompreneur and your everyday, garden-variety entrepreneur? 

If wanting the flexibility to spend more time with your kids is not high on your wish list or not there at all, it’s a pretty safe bet you’re not a mompreneur.

Pre-requisite #1 for Mompreneurship: Kids

If you’re ahead of me then you’re saying, that sounds a whole lot like a stay-at-home mom, especially one who leaves corporate life to spend MUCH more time with her kids.

The difference is a good idea. And the willingness to act on it.

Lots of mompreneurs start as stay-at-home moms. I’ve met many who happily left their jobs or put their careers on hold to have kids. They’re savvy, intelligent women who saw a need and created a solution. And there are others who started their companies after their kids got older. Regardless of the age of their children, being a Mom is just as important to them as being a business owner.

My story is that I had an idea float around my head for a number of years and was eager to execute on it. At the same time, I had a growing desire to spend more time with my two small children. When I was laid off from my corporate job in late 2009, I knew the time was right to do both.

Coming next: back to that good idea and how to take that first step.

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