Five Things I Wish I'd Known When Starting My Small Business Five Things I Wish I'd Known When Starting My Small Business

Five Things I Wish I'd Known When Starting My Small Business

by Nathan Rothstein

March 3, 2014

Don’t worry about margins, worry about strategizing your business to stay around for as long as possible.

It’s not: “If you build it, they will come.” It’s more like, “If you build it, and tell everyone humanly possible, they will come.” It is easier than ever to get a website together, but tougher than ever before to distinguish yourself from the rest. Startups, especially someone making a consumer good or apparel product, fail because not enough people find out about them and it's not because their margins are too low. The longer you stay in business, the more opportunities come your way, and the only way to stay in business is finding ways to reach a wider audience before you run out of money. We used a series of e-commerce marketplaces and flash sales to reach a wider audience, without raising the capital to spend on marketing. For instance in February 2013, we ran a campaign on Groupon, and ended up selling 6,000 custom t-shirt quilts in two weeks.

Focus on value to customer over raising capitol.

Accelerators in “innovation capitols” like San Francisco, Boston, and New York City give advice based on a traditional tech startup: build a user base, show traction, worry about revenue later, then raise money to reach more customers. As you may notice, startups get more attention for the amount of money they have raised rather than their sales figures. When a business like What’s App gets acquired for $16 billion, but only employs 55 people, they have created an unsustainable model for entrepreneurship. We need more consumer goods ventures to stimulate the economy and generate jobs for thousands of people instead of a few dozen. It can be easy to get sidetracked trying to convince those with money that your idea is worthy of investment rather than acquiring customers and building a quality product.

Find businesses to work that are transparent with their process and costs.

Our priority in the first year of operation was to sell as many t-shirt quilts as possible. We had a good relationship with our production partners, but we didn’t spend as much time learning the intricacies of the production process. The technique was never our number one priority; we just wanted a quality product to ship out. That prevented us from seeing the bottlenecks in the process. When we took the time to learn every step for manufacturing one quilt, we could make more informed changes. By simplifying the process, we started to give the customer a better experience at a more competitive price.

As an entrepreneur, it takes a certain level of ignorance to believe that you can almost miraculously turn nothing into something. Since there is no wrong or right way to start a business, entrepreneurs are always looking for tips and anecdotes to help guide decision-making during the early stages of entrepreneurship. Hopefully, our mistakes and lessons learned at Project Repat can trigger a connection to your own idea, and allow you to make iterations to save money and time.
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Five Things I Wish I'd Known When Starting My Small Business